Unlocking paradise: The top tax-friendly havens for Americans retiring abroad

Retirement offers a golden opportunity to embrace new adventures, explore different cultures, and even optimize your tax obligations.

Many Americans are choosing to settle abroad, driven by affordable living, welcoming communities, and the potential for lower taxes.

This guide breaks down top destinations across continents, highlighting the best retirement countries in Africa, Asia, Australia, Europe, and South America.

Each country profile includes an overview of lifestyle appeal, main cities, cost of living, and retirement visa options, along with essential sections on: safety, healthcare, tax friendliness.

Africa

1. South Africa

Top Cities: Cape Town, Johannesburg, Durban
Visa Options: Retired Person’s Visa
Living Costs: From $1,500 per month
Number of US Expats: 20,000

South Africa is a dynamic country where stunning coastlines meet vibrant cities and an affordable lifestyle.

American retirees are drawn to its well-developed infrastructure, diverse natural beauty, and thriving expat communities.

Cape Town, with its iconic Table Mountain and scenic beaches, remains a favorite destination, while Johannesburg offers a vibrant urban experience with a rich cultural scene.

For a more relaxed pace, Durban presents a coastal lifestyle with a subtropical climate perfect for year-round beach lovers.

Safety and financial security

South Africa offers a generally safe environment, though certain urban areas have higher crime rates, making it essential to choose neighborhoods wisely.

Financial security benefits include a lower cost of living and access to affordable housing.

Healthcare

South Africa’s private healthcare system is modern and efficient, often ranking well compared to other African nations.

Expats typically opt for private health insurance, ensuring access to quality facilities.

Tax friendliness

The country only taxes local income, making it an attractive option for retirees with foreign-sourced income.

Additionally, there’s no inheritance tax, which can be advantageous for estate planning.

2. Morocco

Top Cities: Marrakesh, Casablanca, Rabat
Visa Options: Residency Permit (renewable)
Living Costs: Around $1,200 per month
Number of US Expats: 5,000

Morocco combines ancient culture with modern comforts, offering a unique blend of historical charm and vibrant living for retirees.

Cities like Marrakech and Fez provide a colorful tapestry of souks, architecture, and culture, while Casablanca offers a cosmopolitan lifestyle by the Atlantic coast.

The low cost of living makes Morocco appealing to retirees on a budget, and the warm climate adds to the country’s appeal, especially for those looking to avoid cold winters.

Safety and financial security

Morocco is generally safe, with a welcoming atmosphere in major cities. Petty crime exists but is manageable with standard precautions.

Financially, Morocco’s affordable housing and low living costs make it a desirable option for retirees on a fixed income.

Healthcare

Morocco’s healthcare system is accessible and reliable, particularly in urban areas. While private healthcare is affordable, retirees often choose additional insurance for comprehensive coverage.

Tax friendliness

Morocco provides favorable tax conditions, including an exemption on pension income for foreign retirees under specific conditions, adding to its appeal as a retirement destination.

3. Tunisia

Top Cities: Tunis, Sousse, Hammamet
Visa Options: Renewable Long-Stay Visa
Living Costs: Around $1,000 per month
Number of U.S. Expats: 1,500

Tunisia, with its Mediterranean beaches, rich history, and relaxed lifestyle, offers an attractive blend of affordability and cultural appeal.

Tunis, the capital, is a lively city with modern amenities, while Sousse and Hammamet offer more relaxed, coastal lifestyles with a mix of expats and locals.

Tunisia’s unique combination of French and Arabic influences provides a culturally enriching experience for American retirees.

Safety and financial security

Tunisia is generally safe, with most crime limited to petty theft in crowded areas.

Retirees can find affordable housing and enjoy a low cost of living, especially outside the larger cities, providing financial comfort on a fixed income.

Healthcare

Tunisia’s healthcare system is well-developed, especially in urban areas like Tunis.

The country offers a mix of public and private healthcare options, and private health insurance is affordable, giving retirees access to quality medical facilities at a reasonable cost.

Tax friendliness

Tunisia offers tax incentives to attract foreign retirees, including favorable tax rates on foreign income under specific residency conditions.

With no tax on pensions remitted from abroad, Tunisia stands out as a tax-efficient choice for American retirees looking to maximize their retirement income.

Asia

1. Malaysia

Top Cities: Kuala Lumpur, Penang, Johor Bahru
Visa Options: Malaysia My Second Home (MM2H) program
Living Costs: From $1,500 per month
Number of US Expats: 30,000

Malaysia offers retirees a balance of urban living and natural beauty, with Kuala Lumpur providing a cosmopolitan lifestyle and Penang known for its laid-back island charm.

The country is affordable and English is widely spoken, making it easier for expats to adjust.

Malaysia also boasts excellent healthcare facilities, and its rich blend of Malay, Chinese, and Indian cultures creates a vibrant and diverse atmosphere.

Safety and financial security

Malaysia is generally a safe country, particularly in expat-friendly areas. While crime does exist in some regions, expats find security in gated communities and popular areas like Kuala Lumpur and Penang.

The moderate cost of living ensures financial security for retirees.

Healthcare

Malaysia is known for high-quality healthcare at affordable prices. Many healthcare professionals are trained abroad, and the country is a medical tourism hub.

Expats benefit from affordable private health insurance, making healthcare costs manageable and accessible.

Tax friendliness

Malaysia does not tax foreign-sourced income, making it favorable for retirees who draw income from abroad.

The tax structure is straightforward, and the MM2H visa program provides additional tax benefits.

2. Thailand

Top Cities: Chiang Mai, Bangkok, Phuket
Visa Options: Retirement Visa (O-A or O-X)
Living Costs: From $1,200 per month
Number of US Expats: 40,000

Thailand is known for its tropical climate, friendly locals, and affordable lifestyle, making it a top choice for retirees from the US.

Bangkok offers a mix of modern conveniences and cultural richness, while Chiang Mai is a peaceful city in the mountains with a large expat community.

The islands, like Phuket and Koh Samui, attract beach lovers looking to enjoy a relaxed lifestyle with scenic ocean views and year-round sunshine.

Safety and financial security

Thailand is a relatively safe country, with low violent crime rates. Popular expat locations are particularly secure, although petty theft can occur in tourist areas.

Retirees can enjoy a high quality of life without straining their budget.

Healthcare

Thailand offers excellent healthcare facilities, with Bangkok and Chiang Mai hosting internationally accredited hospitals.

Affordable private insurance provides retirees with accessible medical care, attracting many to Thailand for health and wellness.

Tax friendliness

Thailand does not tax foreign-sourced income, which is advantageous for retirees with pensions or other income from abroad.

The straightforward tax system and affordable lifestyle create an appealing financial environment.

3. Philippines

Top Cities: Manila, Cebu, Tagaytay
Visa Options: Special Resident Retiree's Visa (SRRV)
Living Costs: From $1,000 per month
Number of US Expats: 200,000

The Philippines offers retirees an idyllic mix of island living, friendly locals, and affordable living costs.

With English widely spoken and a vibrant cultural scene, adapting to life here is easy for American retirees.

Manila and Cebu cater to those seeking urban amenities, healthcare options, and bustling communities, while Tagaytay provides a cooler climate with breathtaking views of Taal Volcano.

Whether you prefer the excitement of city life or a serene coastal lifestyle, the Philippines delivers an appealing balance of adventure and relaxation.

Safety and financial security

While certain areas of the Philippines require caution, popular expat spots remain generally safe.

Retirees often find comfort in gated communities and secure residences.

The low cost of living allows retirees to maintain financial security on a modest budget.

Healthcare

The Philippines has many private hospitals and clinics, especially in major cities like Manila and Cebu.

Expats often opt for private insurance to access quality healthcare, which is more affordable than in Western countries.

Tax friendliness

Foreign retirees enjoy a favorable tax environment as only Philippine-sourced income is taxed.

The SRRV provides additional tax benefits and makes the Philippines a retirement-friendly destination.

Australia & the Pacific

1. Australia

Top Cities: Sydney, Melbourne, Brisbane
Visa Options: Standard Retirement Visa, Investor Retirement Visa
Living Costs: From $2,500 per month
Number of US Expats: 115,000

Australia is renowned for its stunning landscapes, high quality of life, and friendly communities, drawing American retirees to its sunny shores.

Sydney offers a dynamic, multicultural urban lifestyle, while the Sunshine Coast and Gold Coast attract retirees with their beachside beauty and mild climate.

Known for its excellent healthcare system and safety, Australia provides a well-rounded and welcoming environment.

Safety and financial security

Australia ranks as one of the safest countries for retirees, with low crime rates and stable political conditions.

The cost of living is higher than in some countries, but the quality of life, healthcare, and infrastructure justify the expense for many.

Healthcare

Australia’s healthcare system is one of the best globally, providing accessible medical services through Medicare for citizens and permanent residents.

While private insurance is advisable for retirees on temporary visas, it ensures access to top-notch healthcare.

Tax friendliness

Australia has a straightforward tax system, and foreign income is not taxed for non-residents.

Retirees on certain visas can manage their tax obligations effectively, though higher-income earners may need careful tax planning.

2. New Zealand

Top Cities: Auckland, Wellington, Christchurch
Visa Options: Temporary Retirement Category, Parent Category
Living Costs: From $2,200 per month
Number of US Expats: 30,000

New Zealand captivates with its breathtaking landscapes, from mountain ranges to serene coastlines, making it a haven for nature-loving retirees.

Auckland and Wellington offer urban amenities with easy access to outdoor adventures, while smaller towns like Nelson provide a slower-paced lifestyle with a strong sense of community.

The temperate climate and high quality of life make New Zealand a compelling choice for retirees seeking tranquility and outdoor activities.

Safety and financial security

New Zealand is consistently ranked as one of the safest countries, with low crime rates and a stable political environment.

The cost of living is moderate, but the exceptional quality of life offsets expenses.

Healthcare

New Zealand’s healthcare system provides public healthcare options for residents, though private insurance is advisable for retirees without permanent residency.

Public health services are of high quality and generally affordable.

Tax friendliness

New Zealand offers a four-year transitional tax exemption for new residents, during which overseas income is tax-free.

This arrangement is beneficial for retirees with foreign pensions or other income sources.

3. Fiji

Top Cities: Suva, Nadi, Lautoka
Visa Options: Permanent Residency by Investment, Visitor’s Visa for Long Stays
Living Costs: From $1,500 per month
Number of US Expats: 1,000

Fiji is a tropical paradise with a relaxed island lifestyle and affordable living costs.

Suva, the capital, offers a laid-back city experience, while Nadi provides easy access to beautiful beaches and vibrant local culture.

Lautoka, known as the “Sugar City,” is popular among retirees for its affordability and scenic surroundings.

Safety and financial security

Fiji is relatively safe, though standard precautions are recommended. The cost of living is low, allowing retirees to stretch their income further in this island paradise.

Healthcare

Healthcare in Fiji is affordable, with private clinics available in larger cities.

While the local healthcare system may not match Western standards, private insurance and the option of travel to nearby countries for advanced treatment help manage healthcare needs.

Tax friendliness

Fiji has a favorable tax regime for retirees, with no capital gains or inheritance taxes.

Foreign income is also tax-exempt, making it financially attractive for retirees relying on overseas income sources.

Europe

1. Portugal

Top Cities: Lisbon, Porto, Algarve
Visa Options: D7 Residence Visa, Golden Visa
Living Costs: From $2,000 per month
Number of US Expats: 15,000

Portugal is a European gem with sunny weather, picturesque coastlines, and a rich cultural heritage, making it ideal for American retirees.

Lisbon provides a vibrant city lifestyle, Porto is famed for its charm and wine culture, and the Algarve is a coastal paradise for beach lovers.

With its affordable cost of living, excellent healthcare, and expat-friendly communities, Portugal continues to be a top choice for retirees.

Safety and financial security

Portugal is considered one of the safest countries in Europe, with a low crime rate and a strong sense of community.

The relatively low cost of living and affordable real estate make it a financially viable choice for retirees.

Healthcare

Portugal has a well-regarded healthcare system, with public hospitals accessible to residents and high-quality private clinics available in major cities. Private insurance is advisable for comprehensive coverage but remains affordable.

Tax friendliness

The Non-Habitual Resident (NHR) tax program offers foreign retirees significant tax benefits, including a flat tax rate on local income and exemptions on many foreign income sources, making Portugal a highly tax-friendly choice.

2. Spain

Top Cities: Madrid, Barcelona, Costa del Sol
Visa Options: Non-Lucrative Visa, Golden Visa
Living Costs: From $2,200 per month
Number of US Expats: 57,000

Spain’s warm climate, rich culture, and affordable lifestyle make it a retirement hotspot.

Madrid offers a vibrant, bustling lifestyle, while Barcelona combines historical beauty with modern attractions. The Costa del Sol region provides sun-soaked beaches and a relaxed pace, appealing to retirees looking for a beachside retreat.

Spain’s high quality of life, affordable healthcare, and active expat communities create a relaxed, enjoyable environment for retirees.

Safety and financial security

Spain is a safe and politically stable country. Popular expat areas have secure, welcoming communities, and the cost of living is manageable, especially in smaller cities and towns outside major hubs.

Healthcare

Spain’s healthcare system is ranked among the best globally, with both public and private options available.

Private health insurance offers enhanced access and shorter wait times, while public services are high quality and affordable for residents.

Tax friendliness

Spain has tax treaties with the US to prevent double taxation, and the non-lucrative visa allows retirees to avoid high local taxes on foreign income.

However, careful planning is advised for high-income retirees.

3. Italy

Top Cities: Rome, Florence, Sicily
Visa Options: Elective Residence Visa
Living Costs: From $2,500 per month
Number of US Expats: 30,000

Italy’s historic charm, Mediterranean climate, and renowned cuisine draw retirees looking for a culturally enriching experience.

Rome offers a mix of history and modern city life, Florence is an art lover’s paradise, and Sicily provides a peaceful, scenic lifestyle surrounded by natural beauty.

Safety and financial security

Italy is generally safe, with low crime rates in popular expat areas.

The cost of living is moderate, and affordable real estate options are available, especially outside major cities.

Healthcare

Italy’s public healthcare system is accessible to residents and of high quality. Private insurance is affordable, providing expats with comprehensive coverage and access to private hospitals for shorter wait times.

Tax friendliness

Italy’s tax treaties with the US help prevent double taxation, and retirees on the elective residence visa may benefit from certain exemptions on foreign income, depending on their specific circumstances.

South America

1. Ecuador

Top Cities: Quito, Cuenca, Guayaquil
Visa Options: Retirement Visa (Pensioner Visa)
Living Costs: From $1,200 per month
Number of US Expats: 10,000

Ecuador attracts retirees with its low cost of living, scenic landscapes, and warm, welcoming culture.

Quito offers a mix of historical charm and urban amenities, while Cuenca is popular among retirees for its expat-friendly atmosphere and pleasant weather.

Guayaquil is a bustling port city with easy access to coastal beaches.

Safety and financial security

Ecuador is relatively safe in expat-friendly areas, though general precautions are recommended.

Its affordable living costs and low real estate prices make it attractive for those seeking financial security on a retirement budget.

Healthcare

Ecuador offers good quality healthcare in major cities, with private insurance available for comprehensive coverage.

Expats often find healthcare here to be affordable, with well-trained medical professionals.

Tax friendliness

Ecuador does not tax foreign-sourced income, and its straightforward tax system benefits retirees who draw pensions or income from abroad.

2. Colombia

Top Cities: Medellín, Bogotá, Cartagena
Visa Options: Retirement Visa (Pensionado Visa)
Living Costs: From $1,200 per month
Number of US Expats: 60,000

Colombia’s vibrant culture, warm climate, and low cost of living attract many retirees.

Medellín’s “eternal spring” weather is particularly appealing, while Bogotá offers a lively city atmosphere. Cartagena, with its Caribbean charm, is perfect for beach lovers.

The country’s friendly communities and high-quality healthcare add to Colombia’s appeal for expats seeking an affordable yet vibrant retirement.

Safety and financial security

Colombia has made significant progress in terms of safety, particularly in expat-favored areas like Medellín.

The affordable cost of living and lower property prices make it a financially viable option for retirees.

Healthcare

Colombia’s healthcare system is considered one of the best in Latin America. Private insurance is affordable, and expats can access high-quality medical care in larger cities.

Tax friendliness

Colombia does tax foreign income, but certain exclusions may apply for retirees who meet specific criteria.

Expats can use US foreign tax credits to mitigate tax obligations.

3. Costa Rica

Top Cities: San José, Atenas, Tamarindo
Visa Options: Pensionado Program (Retirement Visa)
Living Costs: From $1,500 per month
Number of US Expats: 70,000

Costa Rica is known for its “Pura Vida” lifestyle, a focus on living well and embracing nature.

San José has a growing expat community, while the beach towns of Tamarindo and Atenas offer scenic views and a relaxed pace.

Costa Rica’s high quality of healthcare, stable government, and natural beauty make it a desirable choice for retirees looking for a balanced, nature-focused life.

Safety and financial security

Costa Rica is known for its political stability and is one of the safest countries in Central America.

The cost of living is moderate, and expat communities provide a sense of security and community support.

Healthcare

Costa Rica has excellent healthcare, with both public and private options available. Expats can join the public system, Caja, or opt for private insurance, which is affordable and provides access to quality care.

Tax friendliness

Costa Rica does not tax foreign income, making it financially appealing for retirees who draw from overseas pensions.

The Pensionado program provides further tax advantages, contributing to Costa Rica’s popularity among American retirees.

Bottom Line

With a myriad of options, selecting the best country to retire requires careful consideration of various factors, including tax implications.

Navigating the complex terrain of international taxes can be daunting, but tax experts can guide you through this process.