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As they age, people eventually decide to retire or may even be required by the businesses they work for.

For retirees in the United States, retirement is expensive. More Americans are considering retirement abroad as a good and tempting option to maximize their savings and preserve or improve their quality of life.

A 2023 Social Security report said that the number of American retirees living outside the US increased from 307,000 in 2008 to over 450,000 in 2022.

CNN reported that some countries have even eased their visa requirements to entice older US expatriates. For example, Belize's consulate in Florida stated on its website that the country is open to Americans who would like to live and retire without struggling with the language barrier as it is an Anglophone nation.

And with companies like BlackRock aiming to help Americans have the dignified retirement they deserve, the conversation has been very much centered on having multiple options, including retiring abroad without breaking a sweat.

With a growing number of people in the US choosing to retire elsewhere, those doing so are advised to thoroughly research where to retire and enjoy their Social Security payments as much as possible.

Dealing with Social Security While Retiring Abroad

One of the options retirees want to take is to be able to retire abroad to enjoy the rest of their lives after decades of work.

According to Investopedia, most American retirees deal with four major factors in searching for their final home overseas: housing prices, health care costs, personal income tax, and property tax.

In the 2020 United Nations International Migrant Stock, the top two countries US expats and retirees in extension travel to to resettle are Mexico and Canada, respectively, for obvious reasons. In descending order, the other countries rounding up the top 10 list are the United Kingdom, Germany, Australia, Israel, South Korea, France, Japan, and Spain.

Social Security said that payments would continue for US residents and citizens choosing to live in any of the top 10 countries mentioned.

For retirees and other expats with substantial outside income, Social Security benefits are taxed as income, and this regulation would continue regardless of whether the beneficiary resides inside or outside the country. In some circumstances, Social Security benefits may be subject to taxation by the host nation, just like foreign social security is in the US.

Another factor to consider is the host country's totalization agreements with the US, which allow workers to pay Social Security taxes once instead of twice. Of the top 10 countries above, only Mexico and Israel do not have totalization agreements with Washington.

With all of these in mind, Americans choosing to retire in another country should make sure to check the Social Security Administration (SSA) website to know if they are eligible to receive Social Security payments in their target country, as well as learn if they would have to undergo dual taxation on their Social Security benefits if they chose to work on the country they would like to retire to.

Retiring US residents also have additional steps to take depending on the person's status, and they should consult with the SSA's guidelines and specifications.

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US, Social Security, Tax