Panama is paradise for retirees

By International Living

Panama is one of the best places in the world for retirees today, combining a low cost of living, near-perfect weather and one of the world's best discount programs for retirees, with up to 50% off everything from public transport to movies, mortgage rates, doctor's visits, electricity, restaurants and airfares.

When you compare Panama with its neighbors, you'll see that it has more amenities than traditional retirement spots such as Mexico and Costa Rica, with lower costs and crime rates. In Panama, you'll encounter less red tape and less interference from local authorities.

To encourage long-term foreign investment, Panama requires no special authorizations, permits or prior registration for foreign investors. The Investment Stability Law, passed in 1998, protects foreign investors from any change in tax, customs, municipal and labor rules for a period of 10 years after an investment is registered. Major companies doing business in Panama include Federal Express, DHL, Sears, Price Costco, BellSouth, Kansas City Southern Railways, Continental and American Airlines, Warranty Company of the Americas and Hutchison Whampoa. Plus, you'll find just about every American franchise you can imagine on the streets of Panama City.

And there are other incentives for foreigners to spend time here, invest here … or retire here. For example:

Newcomers who buy or build a new house won't owe any property taxes for 20 years.

Residents pay no taxes on foreign-earned income.

Tourism investments have 20-year exemptions from import duties, fees for construction materials and equipment, and income, real estate and other taxes.

The U.S. dollar is legal tender in Panama, which insulates its economy from global shocks. During the Asian monetary crisis of 1998, Panama became one of the healthiest economies in Latin America.

Panama's pensionado program

Once you become a resident "pensioner" of Panama under the Tourist Pensionado Visa, you are eligible for the most appealing program of benefits for retirees available anywhere in the world right now.

Now, you may be thinking: "Pensioner? Retiree? That leaves me out."

Not necessarily. The rules for becoming a "pensioner" and qualifying for this visa program in Panama are probably not what you'd expect.

In fact, anyone over the age of 18 may apply and can qualify as a pensionado in Panama. All you need is a guaranteed pension income of $500 per month ($600 for a couple). It must be a pension from a government agency (e.g. Social Security, disability, armed forces, etc.) or a defined-benefit pension from a private company. Sorry, but an immediate, fixed annuity doesn't qualify.

As a qualified pensioner in Panama, you would be entitled to:

• 50% off entertainment anywhere in the country (movies, theaters, concerts, sporting events, etc.)

• 30% off bus, boat, and train fares

• 25% off airline tickets

• 50% off hotel stays Monday through Thursday, 30% off Friday through Sunday

• 25% off restaurant meals

• 15% off at fast-food restaurants

• 15% off hospital bills (if no insurance applies)

• 10% off prescription medicines

• 20% off doctors' consultations

• 15% off dental and eye exams

• 20% off professional and technical services

• 50% off closing costs for home loans and more

Crossroads of the Americas

Panama is also perhaps the most accessible retirement haven for Americans.

There is a frequent nonstop service to Panama City's Tocumen International Airport. It's a 2½-hour flight from Miami on American Airlines and COPA, Panama's national airline, which also flies from Los Angeles and Orlando, Fla. Continental flies from Houston, and Delta flies from Atlanta. Aeroperlas and Mapiex Aero are two domestic carriers that offer daily flights throughout Panama.

Beware, however, that as accessible as Panama is to the U.S., it's still a foreign country. There are certain cultural differences that you can either accept and embrace . . . or try to ignore and become miserable and frustrated.

Time moves at a more leisurely pace in Panama. A one-hour wait might mean two, and a simple meal out with friends can turn into dancing "tipico" at a local disco until five in the morning. It takes a certain disposition not to lose your cool when, for example -- and this happened to a friend living in Panama City -- the computer repair man phones to say he is estoy llegando (on his way over to your house), only to arrive two days later without explanation . . . but ready to work.

Cost of living

Panama has one of the lowest costs of living in all Central and South America: A U.S.-style home can be built for about $40 per square foot; unskilled labor costs $6.40 per day; a full-time live-in maid costs $120 to $160 a month; a beer at a bar costs 35 cents; a cup of coffee, 30 cents; a haircut and shave can cost as little as $2; an afternoon at a beauty salon is $8; electricity is about 10 cents per kilowatt-hour; water bills are $18 per year; telephone service costs roughly $30 a month; Internet access is $14 a month; wireless is available for a bit more; cellular-telephone service costs about $30 a month plus a per-minute charge of around 22 cents; and cable TV will cost you about $30 a month.

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