How We Did It: Retiring to a Central American Mountain Paradise

Lake Forest, Calif., resident Robyn Cole, 56, had always wanted to enjoy retirement with her husband, John, but the differential in their ages created a dilemma.

"If I had waited until I was 65, he would have been 77," says Cole, a former golf course marketing director. "I told him, 'I want to be playing with you, not going to work while you go golfing or to the beach. And I want us to have more years to do things together.'"

Being able to afford early retirement, though, was an even more daunting problem because it meant that Cole would have to pay her own health-care insurance premiums, which she calculated would cost a hefty $24,000 a year. As much as she wanted to stop working and get on with her second act, she figured the move would take too big a bite out of the couple's savings.

Then, the Coles came up with what turned out to be an ideal solution. Earlier this year they relocated to Boquete, a town of 19,000 nestled in the mountains of Panama. Robyn Cole says it turned out to be the best move they could have made, and not just because Panama is more affordable than retirement communities in the U.S. and the climate is an idyllic 70 degrees, give or take a few, year-round.

"It's just a wonderful place to live," she says, gushing.

The Coles' retirement home is a a two-bedroom, two-bath furnished condo on a hillside with a spectacular view of town. The rent: $750 a month. They have all the amenities of home -- cable TV, high-speed internet, a nearby golf course -- and in case the couple gets tired of speaking Spanish, there are plenty of fellow expatriates in town from the U.S. and England. And Boquete has things that they couldn't find at home. The couple dines on just-harvested food purchased at the local market for astonishingly low prices -- "three shopping bags full of fruit and vegetables for $5," Robyn Cole says. Instead of going to Starbucks, they enjoy cappuccinos at Cafe Ruiz, which serves different varieties of coffee grown at local plantations.

For $55 a month, Cole says she rents a second apartment to use as an art studio, enabling her to finally engage in her life-long dream of becoming an artist. "I create sculptures from recycled, castoff jewelry, and I'm getting into painting with hot wax," she says. With the help of the internet, she is able to market her wares on Etsy, the crafts website. She blogs about the couple's life and is building an online gallery and e-commerce site.

Boquete's Panamanian residents have turned out to be remarkably welcoming and friendly, too, Cole says. "Panamanians are wonderful people -- very sweet," she says. "They love jokes. And they're very patient with foreigners. The second they realize that you're trying to speak Spanish, they go out of their way to help you." Many of her neighbors are members of an indigenous tribe who wear traditional colorful Indian dress, but have one foot in the modern technological world as well. "I'll see Indian moms on their cellphones, texting to their kids," she says. And the town is comfortably safe, with crime mostly confined to the occasional theft of a TV set or computer from a home where someone forgot to close the windows and lock the door before going out.

"When Americans think of Panama, they still think of Noriega," Cole says, referencing the corrupt, brutal Panamanian dictator who was deposed by the U.S. back in 1989 and later convicted of drug trafficking charges. "It's a democratic country now, and they've really cleaned up the government. They've modernized Panama City so that it looks like Miami."

And as for health care, the Coles found that it's as good a bargain in Panama as the fresh fruit. Good-quality routine health care is available at a local clinic where prices are so low that Cole says she can afford to pay out of pocket. "A friend went there and needed some blood work done," she says. "The tests cost $20 apiece, and they had the results in an hour." To protect her in the event of a serious illness or medical emergency, she bought a catastrophic care policy from a company that specializes in covering travelers and expats, and the policy is affordable because of the $5,000 deductible.

Perhaps the major downside of moving to Panama is that furniture, appliances and other manufactured goods, which have to be imported from the U.S., tend to be more expensive than they are back home. "They have a store, Conway's, that's like Target on steroids," Cole says. "They've got three floors of stuff, and it's pretty much the same things that you could buy at Target -- sometimes, it's even in a Target box. But it costs a bit more than Target." Those higher costs probably are evened out, though, by the discounts the Coles get on everything from prescriptions to restaurant meals, due to a national program for which all Panamanian seniors, including expatriates, are eligible.

Finding Boquete took a little work. After deciding to join the ranks of the estimated 1 million U.S. retirees who live overseas, Robyn and John Cole investigated a variety of countries, including Mexico, Guatemala and Costa Rica, before Robyn saw a TV program about Panama and was intrigued. "Thanks to the internet, it's easy to do a lot of research about a place, and even see pictures of it," she says. She talked her husband into going to Boquete for a visit -- not the usual sightseeing tour, but a fact-finding visit in which they methodically investigated the available amenities, from the price of real estate to the availability of reliable electrical power. (Boquete, Cole reports, has the same 110-volt outlets as the U.S.) And to ensure that they had an out in case they tired of the expat lifestyle, the Coles chose to rent rather than buy.

So far, they don't seem at all interested in pulling up stakes. "This is about as soft a landing as we could find," Cole says. "I'm still amazed every day, and I feel so fortunate and blessed that we made the right decision."

If you're considering becoming an expat retiree, here are a few resources:

• Kathleen Peddicord, author of How to Retire Overseas: Everything You Need to Know to Live Well (for Less) Abroad, says there are at least a dozen places to retire in comfort on Social Security alone. She suggests Panama City as a choice retirement destination overseas.
• MSN Money compiles a useful guide, tantalizingly entitled "Retire Like Royalty in a Low-Cost Paradise."
• Smart Money explains how to resettle overseas without getting ripped off, and this recent article also features the Coles.