WHEN Patrice Wynne shuttered her independent bookstore, Gaia, in Berkeley, Calif., and retired, she knew three things. She wanted to move to a place where she could slow down the tempo of her life, and it was cheaper to live, but where she could continue to work in some fashion.
“I promised myself — I’m not going to slip into going to cocktail parties and playing tennis,” Ms. Wynne, 61, said. “I wanted engagement.”
And that’s what she got. Three years ago, along a cobblestone street in the center of San Miguel de Allende in Mexico, she opened Abrazos, a 650-square-foot retail shop selling colorful Mexican-themed fabric aprons, kitchen and cooking accessories, handbags and clothing, all sewn by a dozen local seamstresses.
Simply retiring abroad has become old news, as people seek cheaper places to live and to slash health care costs while enjoying more temperate climes. But now enjoying a “working retirement,” like Ms. Wynne’s, appears to be gaining traction with expats, as it has in the United States.
According to the Bureau of Labor Statistics, an increasing number of retirees, who can expect to live longer, healthier lives, are choosing to work in retirement, at least part-time, typically for fear of outliving their money or to keep active and engaged.
Despite a dearth of hard numbers on American retirees abroad, the same seems to be true for them, to judge from the rising number of Social Security checks sent to Americans living in inexpensive retirement havens in Latin America and the Caribbean, and from much anecdotal evidence from expatriate retiree-entrepreneurs like Ms. Wynne and others.
“It seems that the factors that are driving continued work later in life, including part-time work, would be the same for Americans at home and abroad,” said Kevin Cahill, an economist with the Sloan Center on Aging and Work at Boston College. “So I think it’s fair to say that, if the employment opportunities exist, we shouldn’t be surprised to see similar trends with respect to part-time employment for U.S. retirees living abroad.”
There’s a wide range of jobs that globe trotters may consider. Of course, there’s the possibility of accepting contract assignments from former employers. And there are often positions available to teach English, work as a translator, lead English-speaking tours, or work at hotels that cater to English-speaking travelers, according to Betsy Burlingame, founder ofExpatExchange.com, a leading Web site on international living.
In many countries, though, you are required to have a work permit for certain jobs and prove there are not citizens there who could fill the position, she added. In Panama, for example, you can’t work as a doctor or nurse unless you are a Panamanian citizen.
Many expats, like Ms. Wynne, start their own businesses like restaurants, shops, real estate agencies, art galleries, bed-and-breakfasts and small hotels.
For those with an entrepreneurial bent, International Living, a magazine and Web site specializing in retirement abroad, has published an index of the countries with the best conditions for starting a business. The index factors in things like visa requirements, the ease of setting up a bank account, expenses, local taxes and language barriers. In the most recent survey, Panama was the winner, followed by Belize, Ecuador, Colombia, Costa Rica, Nicaragua and the Dominican Republic.
For Ms. Wynne, Mexico appealed for several reasons. It was a country she had visited frequently over the years and where she spoke the language. There were also plenty of expats, the weather was appealing, and it was affordable.
For $105,000, Ms. Wynne bought a single-family home with vistas of the entire city of San Miguel de Allende, a cultural hub in central Mexico, and the surrounding countryside. She spent about $35,000 to modernize it and found happy surprises along the way. “Everything from food to flowers to medical care were considerably less than anything I had known for the last 25 years in California,” she said.
But her ability to inexpensively start a small business, initially in her home, was critical.
Ms. Wynne’s start-up costs for Abrazos totaled about $12,400 for the basics, including inventory, lighting, advertising and computers. And since opening the shop in January 2010, her monthly rent of $600 is a fraction of the $8,000 she was paying for her bookshop space in Berkeley.
Over all, rents in San Miguel de Allende are 72.6 percent lower than in San Francisco, according to Numbeo, an online database of user-contributed information about the cost of living in cities around the world. Restaurant prices there are 54.4 percent lower than the Bay Area.
Steady retail sales, which have increased 25 percent since the year the shop opened, provide enough income to allow Ms. Wynne to live a comfortable lifestyle with plenty of time to travel and even visit her parents in Pennsylvania, without having to tap into her retirement accounts. And she has no plans to start the clock on her Social Security payments when she becomes eligible next year.
But her decision to open a business and keep working goes deeper than the monetary reward.
“When you make a decision to live abroad, there’s never a singular reason,” Ms. Wynne said. “There’s always a complexity of reasons. Yes, it has to do with affordability and having your retirement income be expanded. But like other expats working here, I wanted to be adventurous and have new learning opportunities.”
Moreover, she feels “jazzed on life,” she said. “By opening my store, I place myself in the pulse of the community. We’re on a main thoroughfare so people drop in and talk to me. My life is a touchstone into other lives in the community. I feel healthier and more alive because I am embedded in these social networks.”
Still, for many who work in the Internet age, it does not matter much where you live these days, and this can be especially true for retirees abroad.
Dan Prescher, International Living’s special projects editor, and his wife, Suzan Haskins, are both writers living in Cotacachi, a tiny town in Ecuador, since closing their marketing and public relations firm in Omaha.
If you have a job that you can do online, “you can do it from anywhere on the planet,” Mr. Prescher said. “You don’t have to pick a place depending on whether there’s a job opportunity there.”
His advice: Take your profession and turn it into a business you can do online. For example, if you have been a dietitian, you can be a consulting dietitian online. You can be a proofreader online, an editor online.
“All my wife and I need is a laptop and an Internet connection,” he said. “We can send in our stories and our photographs to editors anywhere in the world. Instead of retiring, we retried our lives.”
Turalu Brady Murdock, a lawyer who specializes in title insurance, has also discovered the allure of virtual work in retirement.
Ms. Murdock, 68, and her husband live in El Tránsito, a small fishing town just off the Pacific coast of Central Nicaragua, in a 10,000-square-foot house (interior patios included) perched on a hillside 200 feet above the rolling ocean waves.
In 2010, she retired as vice president in charge of Latin America and the Caribbean for First American Title Insurance Company, based in Washington, where she had worked for more than three decades. Her primary duties had been to help individuals and companies obtain title insurance for properties they were buying in those regions.
While she lived in many places during her First American career, including New Orleans, St. Thomas, Puerto Rico and Miami, her final posting was in Nicaragua.
When her employer closed the office, she chose to stay in Nicaragua. “I didn’t think I was going to actually work.” Ms. Murdock said. “But people kept asking me the same questions they had for years when I worked at First American. So with a former employee, I started a consulting business.”
Her firm, Title Coordination Services, is based in Managua, the Nicaraguan capital, but Ms. Murdock does not have an office, and the two women do everything by e-mail and phone, so there is no overhead cost.
There are a few downsides. For instance, the Internet connection goes in and out at times, and the electricity has been known to fail for six hours at a time.
Ms. Murdock charges an hourly fee of $150 for advice, as well as a flat fee of $250 for specific searches, like setting someone up with a local lawyer or surveyor. The online consulting business brings in roughly $30,000 a year, which the women split.
“What’s nice about it is that I can put in as few or as many hours as I want,” she said. “A typical week might mean seven or eight hours of work.”
As with Ms. Wynne, there’s more to the work than the financial appeal. “I really like being connected with people,” Ms. Murdock said. “I love learning about the new laws and the intellectual fun of it, trying to figure out how to get something done, how to work with a particular attorney in a particular country.”
Working abroad may sound swell, especially if you can be gazing off at the sand and surf and padding around in your flip-flops while you do it. But it can be complicated.
For example, making mistakes on taxes is common.
“If you’re going to work overseas and earn even a modest salary, you must find a tax adviser expert in international tax issues,” said Olivia S. Mitchell, a risk management professor who focuses on retirement policy and serves as the executive director of the Pension Research Council at the Wharton School of the University of Pennsylvania.
“You should make sure you’re doing everything right because there are some tricky tax laws for Americans living overseas,” Professor Mitchell said. “Both the United States and an expat’s country of residence could try to tax your earned income while living overseas.”
The United States government requires American citizens living and working abroad to file an American tax return annually. Americans working abroad, however, are eligible for the foreign earned income exclusion, which in 2013 exempts the first $97,600 from tax. If you earn much more than this threshold and you pay income taxes to a foreign government, you may be able to take a foreign tax credit. In any event, this can require working with a tax adviser aware of the ins and outs of these policies.
“People who are moving abroad and plan to work need to go in with their eyes wide open,” Professor Mitchell said.
“Before I would decide to settle anywhere, I would certainly want to go visit for six months or a year, not take a lot of money and not try to buy property right away,” she added. “You want make sure it’s the kind of environment that is conducive to letting you do what you want to do.”
Hiring a bilingual person who can help you navigate the operational challenges you’re likely to face is crucial for many expat small-business operators. “Independence is hubris in a foreign country,” Ms. Wynne said.
Learning proper etiquette for a business relationship is also important. In Mexico, for example, even a simple business call takes extra time. You need to ask about the other person’s family, their day.
And even if you are fluent in the language, to understand even the first paragraph of a business contract, it’s essential to have a legal adviser or skilled translator. And, of course, there’s the challenge of operating in two currencies.
“If you’re going to work abroad, the challenges are going to be exasperating, so don’t just do it because you like it or you’re good at it; do it because you really, really love it and enjoy every minute of doing it,” Ms. Wynne counseled.