Boomers are leaving America to retire abroad in droves because the U.S. is just too expensive

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Boomers are leaving America to retire abroad in droves because the U.S. is just too expensive

By Alicia Adamczyk | Fortune Magazine | July 7, 2024

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When Allan Fawcett decided to retire from his career in computer science in 2011, he knew he wanted to spend at least a few years traveling, particularly around Europe. After decades working in tech, he was ready, as he says, to give his mind a rest. “Computer programming destroyed my brain,” he tells Fortune. “I needed an escape.”

What he didn’t know is that that escape would become permanent. He met his now-wife, Elisabeth, shortly after he retired, and eventually took the leap to move permanently to Spain with her.

Fawcett, now 67 and a Spanish resident through marriage, couldn’t be happier about his decision. Though his wife still works, he spends his days playing tennis, reading, and going to the beach or cafés with expat friends in Barcelona. He and his wife are able to travel around the continent, even planning a trip to Paris for the Olympics this year.

The same lifestyle wouldn’t be possible in the U.S., Fawcett says. Housing is much more affordable, food is inexpensive, and the wine is even less so. The mass transit system is a godsend; Fawcett doesn’t have a car and doesn’t need one to get around. Walkability is also a major benefit.

“It’s a good life here,” says Fawcett, who became a resident in 2019. “Outdoor dining is everywhere, the weather is amazing. Everything is very cheap.”

Fawcett is part of a growing trend of retirees, spurred by America’s retirement crisis, who are moving abroad instead of spending their golden years in the U.S. In December 2022, there were over 700,800 people receiving Social Security payments abroad, according to the most recently available data from the Social Security Administration. In 2000, that figure was less than 400,000.

Some move abroad because they simply cannot comfortably live on a fixed retirement income in the U.S., where the costs of housing and healthcare, especially, are becoming increasingly unaffordable. A substantial number of retirees rely almost completely on Social Security payments to make ends meet in the U.S., which average around $1,900 per month. A growing portion of elderly Americans live in poverty, with social services few and far between, if they are accessible at all.

Others always dreamed of travel and immersing themselves in other cultures. And still others could afford to stay in the U.S. but realized how much more they could get for their money abroad. 

There are drawbacks, of course. The retirees, in most of the cases, families are in the states, so they need to plan trips to see each other. The cultural differences can be difficult to manage, at least at first. There’s not the same level of individual wealth in Europe as in the U.S.  The typical salary is far lower than the six-figure jobs you can find in the states. And of course, the income tax burden is much higher. 

But the standard of living is much better for a wider swath of the population than it is in the U.S. There are the small things, like fresher, less expensive groceries and concert tickets being much more affordable and accessible. And then there are the larger benefits, like months of paid maternity leave, inexpensive secondary education, and affordable health care.

3 key takeaways from the article

1. In December 2022, there were over 700,800 people receiving Social Security payments abroad, according to the most recently available data from the Social Security Administration. In 2000, that figure was less than 400,000.  Figures explain a growing trend of retirees, spurred by America’s retirement crisis, who are moving abroad instead of spending their golden years in the U.S.
2. Some move abroad because they simply cannot comfortably live on a fixed retirement income in the U.S., where the costs of housing and healthcare, especially, are becoming increasingly unaffordable.  Others always dreamed of travel and immersing themselves in other cultures. And still others could afford to stay in the U.S. but realized how much more they could get for their money abroad. 
3. There are drawbacks, of course.  But the standard of living is much better for a wider swath of the population than it is in the U.S.

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Topics: Retirees, Retirement Plan, USA, Europe, Spain