This page answers some of the questions we’ve received about:
1) Why we completely changed our lifestyles
2) Life as nomadic travelers
3) Life as expatriates living in Portugal.
THE BIG WHY
Why quit your jobs, leave a home you love along with friends and family and start all over in a completely new direction?
Clichés become clichés for a reason and the phrase “Life is short” seemed to be beating a drum in the year 2011. We’d reached the age where gradually, a few of our friends and close family were battling chronic illnesses and life-threatening diseases. Living the “American Dream” had increasingly lost its allure as the things we owned gave us less pleasure and we started thinking about how to restructure our priorities. In short, although our lives were okay, we were mired in routines that no longer mattered and we missed the anticipation of the ‘What’s next?’ part of living. Having more time to do the things we’d put off for ‘someday’ assumed a greater importance. Instead of waiting for a someday (which might never come) we decided we were ready for a lifestyle reset now.
LIFE AS FULL-TIME TRAVELERS
But what did you do with all your stuff?
Imagine the unthinkable – getting rid of everything you own. Selling it, donating it, or gifting it to friends, family and charities. It took us a year to do it but that’s exactly what we did. We passed on family heirlooms to other family members, digitized treasured photos onto DVD’s and uploaded them to our computers and the cloud, figured out what to do with our art collection, became Craig’s List experts and held two garage sales. We leased our house and eventually sold it the third year of our travels.
Tip – Read a book or two on minimizing/simplifying and start slow. It takes time and a major mind reset to let go of your stuff. Two books that we read and recommend are Simplify by Joshua Becker and The Joy of Less by Francine Joy.
What other preparations did you make?
It’s hard to believe now, but in 2011 there weren’t that many blogs online that were written by retirees deciding to sell everything and travel full-time. We read everything available that we could find as well as blogs written by younger, full-time travelers and expats. We made list after list of things to think about, questions that we needed to find answers to and possible problems that might come up. Between the year that we made the decision to change our lives from traditional homeowners and employees with paychecks to nomadic retirees we:
* Assessed our bank accounts, savings and investments
* Assembled the documents we might need and checked the expiration dates including passports, driver’s licenses, credit cards and travel insurance
* Talked to our accountant about how to file income taxes online
* Updated our wills and discussed our wishes with our son and family members
* Requested our medical records from our doctor and dentist. We scanned these and stored them in Dropbox in the event that we would need to refer to them. We also updated our vaccines (tetanus and flu shots) and arranged to have a series of vaccines administered for our upcoming travels including Yellow Fever, Typhoid Fever and Hepatitis A and B.
How do you support your travels?
The question everyone is thinking and no one wants to be rude enough to ask, right? Richard receives a social security check each month (Anita is not too far away from the time she can double that income) and we withdraw savings as needed to allow for a comfortable lifestyle. We’re not about to go bare-bones but we don’t live extravagantly either.
Tip – Either set up a budget or track your daily expenses to be more mindful of where your money goes. It helps us to keep in mind the ‘want versus need’ conundrum.
How do you access/transfer your money?
After some research on how to avoid the high foreign transaction fee costs, we decided that the Capital One credit card and Charles Schwab debit cards would work best for us. Capital One has no foreign transaction fees and Charles Schwab reimburses all transaction fees, both foreign and domestic, at the end of each month. Bank of America has a traveler’s plan with no foreign transaction charges also and we use their credit and debit cards as our backup plan in the event of a damaged, lost or stolen card. Richard’s social security is directly deposited into the Charles Schwab account and ready to access by ATM. Also, it’s easy to transfer funds online between Bank of America and Charles Schwab as needed.
Tip – We use our credit card sparingly and for large purchases only to avoid possible credit card fraud. (This might be an example of being too cautious since that leads to the loss of credit card points we could use for future travels.) We withdraw the local currency from the ATM and use that for day-to-day expenses.
But how do you get your mail and make/receive calls?
We use a family member’s address (a big shout-out to my sister, Kari, who acts as our fairy godmother) as our official address which allows us to keep a near normal presence in the US. Whenever possible, we opt for the ‘paperless’ route and pay our bills online. Since we’ve been gone for 5 years, the mail is dwindling although apparently, junk mail never dies. We can review our bank transactions, pay credit card bills online, file our taxes and conduct other business as needed. We have a US Skype number that allows us to receive and place phone calls. In short, unless we tell them, no one really needs to know we’re out of the country.
How did you deal with your medical needs and emergencies while traveling full-time?
For years we recommended buying an annual policy from Global Medical Insurance (IMG) with a very high deductible to cover us in case of a catastrophic accident or illness. We both had to submit medical records and ended up with different plans with one of us receiving coverage worldwide including the US (as long as we spent at least 6 months outside the US per year) and the other obtaining coverage for any country with the exclusion of the US. We never filed a claim and the costs increased each year at exorbitant rates until we finally dropped the plan. BUPA and CIGNA are also in the same cost bracket. We found that going naked (or without insurance) might be an option to consider as we paid out-of-pocket throughout our travels for all our medical, dental and prescription needs. Healthcare (doctors, dentists, labs) is very reasonable once you leave the US and we’ve been pleased with the professional and knowledgeable people we’ve encountered so far. Of note, our costs for doctor’s visits and prescriptions were ridiculously (but not in a funny way) less than what we were paying in the US for insurance premiums and copays.
Tip – We’ve had several friends recommend World Nomads which is much more affordable.
What do you do about your prescription medications?
We each have a list we update regularly of our medications with both the brand and generic names, strength and the condition the medication is treating. This includes vitamins, over-the-counter meds for nausea, cold symptoms, pain and fever, etc. In Mexico, Central and South America as well as many of the Caribbean islands, we didn’t need a written prescription to refill our meds. European countries, too, will allow you to buy a variety of medications without a prescription. Our advice is to stock up on those prescriptions that you can and check at a pharmacy when you arrive to see how to refill what you need. If you need a written prescription, you can get recommendations for a doctor from expat groups, hotels and the local pharmacy. (It helped tremendously that I was a pharmacist in my former life.)
Tip – Brand and generic names may vary from country to country. Some of the names may be similar to their US counterpart or you may find that a medication you take is not available in another country. Almost all of the pharmacies that we’ve been to have internet access and will look up the medication name and availability if you ask. Sometimes they can order a medication for you, obtain it from another pharmacy or substitute it with a similar medication.
What are some of the upsides and the downsides of full-time travel?
The Ups. For most of the three-plus years we were nomadic, we were slow travelers and spent an average of one to three months in each country. This allowed us to immerse ourselves into a destination, get familiar with how to navigate our way around a village or city and find out where the ATMs, markets and restaurants were located. Traveling slow also allowed us to settle into the not-so-exciting business of living our lives with the familiar routines of cooking, cleaning, laundry, paying bills, correspondence and researching future places to visit. Actually living in a place, however short the time, also gave us a chance to explore and discover the landmarks and landscape at our leisure: sightseeing at its best. We chatted up the locals as best we could in our fractured Spanglish and exchanged a lot of smiles, nods and the occasional shrug. Whenever possible, we tapped into the local expat community to ask questions and meet people, many of whom we keep in touch with still. Our favorite thing about traveling full-time was the feeling of being more in the here and now, and slowing down to appreciate the unique quality of each countries’ similarities and differences. And always, there was the anticipation of our next destination.
Tip – We traveled like the locals too, using the low-cost and well-developed bus systems of Mexico and Central America to slow travel from destination to destination. In countries where we were more concerned about possible violence or danger like El Salvador and Honduras, we checked with local travel agencies about shuttles and would hire recommended taxi drivers to act as our personal guides. Many times we used public boats and ferries to take us to more remote places like Placencia in Belize, Utila, one of the Bay Islands of Honduras, and Bocas del Toro in Panama. Once we reached South America where the distances are much greater, we used local airlines which are less expensive than their international counterparts.
The Downs. To be truthful, there were very few things that got us down for the first two-plus years. Maybe we were in the ‘honeymoon phase’ but the sheer freedom of structuring our days (or not) as we wanted to, was exhilarating. We loved unfolding our big wall maps of Mexico, Central and South America (something we were always glad to make room for in our limited suitcase space) and figuring out how to zig or zag our way to our next destination. Gradually though, the idea of packing and repacking, living out of a suitcase, schlepping it from bus to taxi and back, just got plain old. Deciding what clothing to pack was easy in the one-season tropical climates of Mexico, Central and South America and some of the island countries. However, once we decided to shift our travels to Europe, the clothing needs doubled for a two-season climate and our suitcases got a lot heavier. Visa restrictions, especially the Schengen Visa (click HERE for more info) made traveling more complicated. Living in too-small rooms and making-do with just the basics in an AirBnB apartment (every traveler has experienced a dull knife or two) gradually became less enchanting. We felt a growing isolation in places where we met few people and patching together our health care needs also seemed to get incrementally harder. The glow of nomadic life gradually dimmed in year three and we knew it was time to set up a base and use it as a place to launch future travels.
LIFE AS EXPATRIATES AND LIVING IN PORTUGAL
Honestly, we’d always pictured ourselves living somewhere in a beach community in Mexico or somewhere in Central America. As we traveled, we’d say, “Sure this is a nice place to visit but … could we picture ourselves living here? ” We kept a list of places that might work (interestingly, none of these were on a beach) but gradually we realized that the draw of many of the towns and cities we’d visited was more about the people we’d met than the actual places. And, the more we traveled, the more we recognized our preference for places with historical landmarks and histories that went back centuries. We wanted to be close to old world culture and museums as well as country landscapes including beaches and seas that we could look at for hours. We wanted to be close also, to markets and grocery stores carrying a selection of good foods and inexpensive restaurants that offered a variety of choices. In a nutshell, we wanted our version of paradise: a place where the cost of living was affordable, a mild climate and close proximity to many destinations for future travels. We knew within a week of our first visit to Portugal that it had everything we were looking for – plus that indefinable feeling of coming ‘home’. In fact, Portugal is rated Number 1 on Forbes’s 2017 Best Places To Retire Abroad and Number 3 on the 2017 Global Peace Index (right behind Iceland and New Zealand), ahead of Canada at Number 8 and a light year away from the US standing at a dismal Number 114.
How do you get a Resident Visa in Portugal?
We wrote about how to get a 4-month resident visa HERE for US citizens with some explanations and links. To give you a recap: you need to apply in person or by mail to a Portuguese Consulate (information can be found HERE) or the Embassy in Washington, D.C. Information listing the various types of visas and how to apply, including a list of supporting documents needed is available HERE. Once your initial 4-month visa is approved and you arrive in Portugal, you’ll have time to settle in before you’ll need to renew it at the SEF (Service de Estrangeiros e Frontiers or, in plain English, the Immigration Office) and submit a few more documents. Our post detailing our first experience at the SEF can be found HERE. This visa renewal is good for one year. The next renewal will result in a two-year resident visa which is what we have now.
Tip 1– If it sounds complicated, we’re not going to argue. However, think about the bureaucracy in the US for a moment (or any ‘First’ world country for that matter) and you’ll realize how many years it took to assemble your paper life. The ‘Great Document Roundup’ as we called it may seem daunting but only because you’re amassing all the required documents at once. Just take a deep breath, muster your patience and break things down into steps.
Tip 2 – In our various posts, we talk about hiring a lawyer to help us through the visa process. In hindsight, this expensive assistance really isn’t necessary although a little handholding is always nice. (However, we’d rather hold our own hands at this point and save some money.) You can do everything yourself for the first step of the visa process when you’re gathering your documents to submit to the Portuguese consulate. Once in Portugal, there are a few times when you might need a lawyer but this is a pricey way to go. A much less costly alternative can be found in the form of a Portuguese resident who can act as your fiscal representative in obtaining a couple of documents. Check with a local expat group when you arrive for recommendations.
What is your Cost of Living?
This is the question that always interested us when we’d read about the lifestyle of other expats in various countries because, while it wasn’t our main reason for expatriating, it still played a major part in why Portugal appealed to us. We’ve kept track of our monthly expenses since September 2012, at first because we were curious as to how the countries we were traveling in would compare in terms of expenses, and as a way to monitor our own spending. We have an up-and-coming post where we’ll itemize our expenses but we have a quick and dirty estimate of our monthly costs for the last three months which includes rent, utilities, food, car maintenance and gas, health insurance, household goods and miscellaneous costs. Excluded are travel and medical expenses. Our monthly average is about USD $2500 – $2800 per month. We probably eat out two to four times a month and our rent is about $900. We’re mindful about how we spend our money but we like our comforts and splurge occasionally too.
Tip – Keep in mind that we live in the Algarve Region of Portugal which, along with the city of Lisbon, is the most expensive area of Portugal. Your money will go farther if you opt to live in other areas.
How do you find a rental apartment in Portugal?
There’s no such thing as multiple listing here in Portugal and finding a rental can be a slog, especially in the popular Algarve where you’ll find yourself working with multiple property managers. Rents are all over the board with the area around Lagos one of the spendiest for a long-term rental. Anywhere between €600 – €1200 is reasonable for a 1-2 bedroom/1-2 bath apartment. To start your own research, check out the Facebook page called Long Term Rentals Algarve for listings or type Rentals in the Algarve region of Portugal into your browser for listings and property managers.
Tip – We tell people who are thinking about visiting the Algarve area and Lagos in particular to avoid the high season months June through August and maybe even the shoulder season months, May and September, when rents are at their highest and tourists crowd the streets. AirBnB has listings for short-term rentals anywhere you want to visit and nothing beats the boots-on-the ground approach to finding a year-round rental you like.
What about buying a house or condo?
We don’t know about the rest of the Algarve, but a common sight in Lagos are the cranes silhouetted against the sky and apartments and condos in various stages of building. Signs saying ‘For Sale’ or ‘A venda’ can be seen wherever you look. It’s a hot market and the asking prices are still climbing way past anything we’d want to spend. Having divested ourselves of our property back in the US, we much prefer the freedom of renting versus tying ourselves down anywhere. At this point, there doesn’t seem to be upside. At the very least, wait until you’ve been here awhile and have had a chance to explore the variety of regions and the country to find what suits you best. We happen to like the more rural, laid-back feel and climate of the Algarve but friends of ours prefer the central and northern coasts around Lisbon and Porto where there’s more of a cosmopolitan vibe.
But what if I die?
We can give the flippant answer of We’re all going to die, which is far from helpful or give you our Hereafter philosophy. (Trust us, you don’t want to hear it, you probably won’t agree with it, and it’s way more shallow than deep.) That said, we drafted our first US will in the eighties, after our one-and-only was born, and we’ve updated it periodically since then. Copies of our newest will are kept at my sister’s home along with our dwindling stack of important papers which include our Durable Power-of-Attorney and Advance Healthcare Directive. A few months ago, we met with our Portuguese attorney and had him write a will for what few assets (car, bank account) we own here in Portugal. This will is written in Portuguese with an English translation. It’s pretty basic but among other things, our Portuguese will mentions that we also have a will back in the US. It specifically states that we do not want our remains to be repatriated to the US which is a huge expense and a why bother? (No one in either of our families seems to care that much about our decision to remain wherever we drop either.) And, continuing with the mortal remains theme, last week we pre-paid for our imminent demise with a bare-bones (no pun intended) international funeral plan that includes everything we can anticipate. We’re also in the process of letting trusted friends here in Portugal know where our papers can be found. And, in keeping with Benjamin Franklin’s famous saying, “ … the only things in life that are certain are death and taxes,” our next question tackles the second part.
How do you deal with your taxes?
Google the question, “Do I have to pay US taxes if I live overseas?” and the answer is a resounding “Yes.” The sad reality is that leaving the country does not mean you can leave this obligation behind, no matter how much you’d like to. If you are a US citizen, you are required to pay income taxes no matter where you reside. (For our readers who aren’t from the US, it’s worth checking out what your tax laws are if you’re considering long-term travel or expating.) Since we’re somewhat lazy and generally hazy on anything tax related, we have a Texas accountant who keeps current with the laws and has helped us file our taxes for several years. Because we’ve done our damnedest to simplify our lives (no paycheck, no property, few deductions) our taxes are simpler to file too.
TIP – Paper tends to add weight when you’re traveling full-time and clutter when you’re not, so we scan copies of all our medical expenses and receipts to our computer and upload them to Dropbox in case we’re ever audited.
TIP – For those of you considering an expat life living and working in another country as a U.S. citizen (instead of a totally idyllic retirement like us) you are also required to file. And yes, the IRS wants to know all about any money you make overseas.
If I get a resident visa to live in Portugal, do I have to pay taxes in Portugal?
This question gets you the wishy-washy answer of Yes and No and, since we’re not lawyers, accountants, nor remotely interested in trying to grasp any legal intricacies, we’ll try to skim-answer this question as best we understand it. (In other words, if you want a better answer, ask someone else.) Foreign residents who live in Portugal are called (probably one of the nicer names anyway) Non-Habitual Residents (NHR) and Portugal has a tax treaty in place with the US and several other countries that exempts these residents from double taxation on their foreign income. Since we’re retirees, this exemption means that we don’t have to pay taxes in Portugal on our US social security and money from our retirement plans. Of course, nothing is that easy and you have to:
1) register as a non-resident taxpayer
2) obtain your residency visa
3) register as a tax resident in Portugal and
4) then apply for the NHR exemption which is applicable for ten years.
A link that explains this requirement better can be found Here and there are more answers online. To be compliant, you need to file annual tax returns in Portugal, stating your worldwide income and provide adequate documentation as well as proof that you’ve paid your income tax back in the US. We copied and submitted our income tax returns which worked just fine.
How difficult is it to set up a bank account?
In recent years, many foreign banks are refusing to work with American citizens because the US imposes burdensome filing requirements upon them but we found it remarkably easy to set up a bank account in Portugal and we made a good friend, Teresa, in the bargain. (We refer all our friends to her.) We picked Millennium BCP bank because it seems to be located in almost every city and village in Portugal, and our new BFF, Teresa, patiently walked us through all the forms. The bank account required passports, our rental lease, our fiscal numbers (trust us, this essential number, also known as an NIF, will be the most important part of your official new identity as a resident of Portugal) and a copy of our US social security cards. We left with a stack of papers that included online instructions and passwords welcoming us and our money to the new Millennium family and received debit cards in the mail a couple of weeks later.
Note – We set up our account in November of 2015. We’ve talked to friends who have set up accounts recently and our info still appears to be current.
TIP – If you plan to set up a bank account in Portugal (or any foreign country for that matter) this link is a terrific quick and dirty into to what you need to know about foreign bank account reporting as a US expat. And you can sound like an expat pro to your friends and family when you casually drop the acronyms FATCA and FBAR into your conversations.
Can you give me the lowdown on all things medical in Portugal?
This won’t be a surprise to anyone from the US, but we receive a lot of questions related to Portugal’s healthcare system from US citizens and retirees. As residents of Portugal, we are entitled to access the National Health Service (the Portuguese Serviço Nacional de Saúde or SNS) for almost free public healthcare. Almost immediately after we received our residency cards, we signed up at our local health service center in Lagos bringing our passports along with us as required. We were each issued a paper with our individual numbers to use in the event that we find it necessary to use the public healthcare system. That said, we understand that, although the care is good at the public hospitals, the waiting lists for routine visits can be longer than what we’d like and that many of Portugal’s public hospital and clinics may be crowded and understaffed. Instead, we’ve elected to access the private hospitals using our private health insurance company Medis, which was offered through our bank for a cost of €46 per person each month. With private insurance, we have no problems getting in to see English-speaking doctors at the private hospitals in a timely manner and the care we’ve received has exceeded our expectations. After coming from the US where many of the doctors are stressed out, overworked and all-too-often forget the human side of health care, it’s been awesome to find doctors who are warm and caring and our visits to them unhurried. The copays vary from €15 -25 and, if a prescription is necessary, we can get a discount at the pharmacy when the doctor writes down our national health service number.
The pharmacies are also quite different in Portugal compared to the US. Some medications like inhalers are available without a prescription and when your prescription is presented, the medication is located, a notation is written on your prescription indicating that the medication has been dispensed and the prescription is handed back to you. Quick, efficient and quite a bit simpler than filling a prescription in the US but, my critique as a former pharmacist would be that there seems to be little advice given nor screening for drug interactions. There are upsides however, and almost all of the drug prices are much lower than in the US.
TIP – Make sure to ask for the generic as it won’t automatically be offered.
TIP – A good reference that will help answer your questions regarding Healthcare in Portugal can be found Here.
How’s that learning Portuguese going?
In the Algarve area of Portugal, as well as the larger cities of Lisbon and Porto, it’s not hard to get by with English as your primary language. And, because laziness is always our convenient fallback, the fact that English is spoken widely has proven to be our greatest stumbling block. We really have to put forth an effort to find locals to practice our Portuguese with as they, in turn, like practicing their English on us expats. That said, Richard (as always more diligent when it comes to language learning) has been attending classes twice a week for several months and is actually making some progress. I, on the other hand, have found all sorts of excuses to avoid this exercise and fervently believe that (some) spouses should never attend the same classes if they want to remain happily married. Eventually though, I realize that I need to ‘get with the program’ so to speak, and make a real effort to learn some Portuguese since this is our adopted country. We love exploring other parts of the country where finding English speakers is more difficult and having some familiarity with the language really enhances our experience.
TIP – Here’s a great online resource for learning European Portuguese (which differs from Brazilian Portuguese) that we’ve found useful.
And, our final question (for those of you still with us) is:
This lifestyle reset to become a fulltime traveler and/or expat sounds like a lot of work. Is it worth it?
Yes and Yes! We’ve heard variations of this question several times and rather than painting a rosy picture and telling a happily-ever after fairytale, we have to admit that shaking up our lives has been, in some respects, the hardest we’ve ever worked. The flip side to that is, it’s also been the hardest we’ve ever played and the past years have been some of the best in our lives. Trading the routine and the known is a great and trusting leap into the unknown cosmos of foreign plane, train and bus terminals, unique and exotic cultures and different languages, customs and rules. And sure, there have been downsides: bureaucratic tape and finding work-arounds to get things done, patience-testing situations (that we generally fail first time around) and things that make us exercise our ‘colorful’ vocabularies. But, we can truthfully say that we have nevercontemplated going back to our old lives. For us, going forward is infinitely more rewarding and making the decision to shake up our lives six years ago has wildly exceeded our expectations.
Last updated November 13, 2017