Exit Plan - How to Retire Abroad: Costa Rica

When the time comes to retire, not everyone wants a condo in Boca Raton. Many people want to spend their later years in another culture, one that makes them feel like they’ve stumbled upon a secret paradise.

One such place is Costa Rica. Its name means “rich coast,” which is appropriate considering its location on the Central American isthmus. Its equatorial setting keeps the climate tropical year-round, and the Pacific Ocean on its west coast and the Caribbean Sea to the east make it everything the retired beachcomber could possibly hope for.

Just one look at some photos makes the tiny nation look incredibly enticing, but just as there’s more to retirement than simply quitting one’s job and not getting a new one, there’s more to Costa Rica than its beaches. Therefore, those seriously considering picking up stakes to live there should look a little closer.

CNBC.com used data from the State Department, the Costa Rica tourism board and experiences of some Americans who have lived there to gain insight into the nation’s economy, real estate market, healthcare resources and other issues that retirees should weigh when relocating. Read ahead to find out more about making Costa Rica your own retirement haven.

By Daniel Bukszpan
Posted 20 July 2012

The logical first step in finding out if Costa Rica is the right place for you is to see it for yourself. According to the official website of Costa Rica, visitors from the U.S. are not required to carry a visa to enter the country.

“U.S. dollars and major credit cards are widely accepted,” the website says. “You will find ATM machines distributed throughout the country.” Those wishing to get a more authentic experience can exchange their U.S. dollars for the national currency, known as the colón.

An ideal way to see the lay of the land is by taking the train tour that goes from the nation’s capital of San Jose to Caldera, a port city in the province of Puntarenas. Those preferring to drive can use their U.S. driver’s licenses there for up to three months.

Once you’re out and about, you’ll start to meet the people who live there. According to Brian Benson, general manager of the Chill Expeditions Costa Rican tourism company, the people were the clinching factor in his decision to take up permanent residence there.

“I have never met a more kind and welcoming people,” he said in an e-mail. “I actually met my wife – a native Costa Rican – here, so when I say I fell in love with the local population, I really mean it.”

Costa Rica has a tropical climate. The temperature varies depending on elevation, so the coastal lowlands have average temperatures between 71 degrees and 81 degrees, while it’s 20 degrees lower in the high mountains.

The seasons are divided into two periods, summer and winter, but these are different from their U.S. counterparts. In Costa Rica, “summer” is the name for the dry season, and “winter” is the name for the rainy season. Summer takes place between December and April, and winter occurs from May to November.

Laura Berger moved with her husband Glen to Costa Rica in 2006 for a one-year sabbatical from their corporate jobs in the U.S. She said in an e-mail that real estate prices can vary considerably.

“In a development in the North Pacific (Guanacaste) funded by a consortium including Bill Gates, small beachfront lots were selling for $6 million,” she said. “On the other hand, in Zancudo—meaning ‘mosquito’—south almost all the way to Panama, beach lots three times the size go for low six figures.”

Berger advises caution when looking for real estate through a third party. “Costa Rica is an unregulated market where anybody can claim to be a 'Realtor,” she said. “The main problem is a developer preying on your better sensibilities in a moment when you are mesmerized with paradise. … It is very important to ask around for a good, solid lawyer.”

The primary language is the Costa Rican version of Spanish. However, Berger said that many of the locals speak English, and that enclaves of American expatriates abound. ”The expats tend to live wherever there’s a killer view—hillsides and oceanfronts—so the expats tend to live in communities,” she said.

Those communities offer some creature comforts to Americans who aren’t ready to get away from it all just yet. According to Berger, in Escazú, a suburb of San José, homesick expatriates can get all their favorite comfort foods at Tony Roma’s, TGI Friday’s “and almost every North American fast food chain.”

“Overall, the dollar tends to go farther in Costa Rica, which can be attractive to tourists and retirees,” Benson said. Indeed, as of July 19, the exchange rate was 499.6 colónes to one U.S. dollar, and the sales tax was 13 percent.

According to the State Department, the per capita income in 2011 was about $11,562, the inflation rate was 5.3 percent and the unemployment rate was 6.5 percent.

Agriculture accounts for about 6.9 percent of the gross domestic product. Industries such as medical equipment, textiles and apparel comprise 26.1 percent of GDP; commerce, tourism, and services make up 67 percent.

Not all retirees are created equal when it comes to getting around. While some have few issues with their own mobility, others face more of a challenge. Benson urged caution for those who are considering a move to Costa Rica and have physical limitations.

“I would recommend it for retirees who are still active,” he said. “Accessibility things like wheelchair ramps are not everywhere, so I would be hesitant if someone had a handicap or other physical limitations. The more rural areas will have dirt and gravel roads, which could potentially be an issue for the elderly.”

Retirees considering a potential move to Costa Rica will no doubt be interested in an age-old question— how’s the food?

Luckily, the answer seems to be a resounding “delicious.” Typical Costa Rican cuisine is a mixture of indigenous, Spanish and African flavors that go heavy on the tamales, chicken and fish.

“The Ballena Coast, where we lived, boasts some of the finest cuisine in Costa Rica since its first expat infusion was from France and French Canada,” said Laura Berger.

Benson pointed out that while the traditional food is outstanding, almost any kind of food is available if you know where to look.

“I have found great Italian and fusion restaurants in San Jose,” he said. “A personal favorite restaurant of mine is Kalu. … It’s an art gallery and restaurant all in one, so it is visually pleasing with fantastic locally prepared cuisine. … Another great spot is Stashus Con Fusion in Puerto Viejo on the Caribbean Coast. The Caribbean chef specializes in curry dishes, and his fish tacos have won many awards.”

Like it or not, retirees must be more aware of the health care situation in their communities than their younger counterparts.

According to Laura Berger, “you could live in Escazú near the capital and enjoy health care that is on par with that in the U.S. and much cheaper.” However, living in a rural area presents a different picture. ”Living outside the capital would involve airlift to the capital for anything truly serious.”

According to the United Nations Development Program, life expectancy at birth for native Costa Ricans is 79.3 years, while those living in the Nicoya Peninsula live in one of the world’s “Blue Zones,” where healthy, active people have been known to live past age 100.

Costa Rica certainly sounds like a retirement paradise, or at least a good place to stay for a very long time. However, Laura Berger emphasizes that the decision to pick up and move to another country is a big one that shouldn’t be taken lightly, despite how strong U.S. currency is there.

“It’s important to get past the dollar signs and think about the implications of adjusting to a community of new methods and cultural norms,” she said.

Her warning notwithstanding, Berger still recommends the country to intrepid retirees. “If you want to retire with Carmel-style views at 10 percent the price, Costa Rica can still be the place.”