# Planning ahead...just a little!



## BabyJane (Apr 17, 2011)

Hi, all:

This is my first post, so a little about me because I can't fill out a profile yet.

I am 39, my husband is 43 and we have no children. We're American and currently live in America.

What I want to ask is this. My husband and I are becoming increasingly irritated with US politics and feel strongly about the role of the state in providing at least some semblance of a safety net/social contract. Our current spate of leaders seem keen to undo all the progressiveness that has been done from the 1940s until now. We treat our elderly people very poorly here (in my opinion) and it doesn't seem like it's going anywhere but down. Again, this is just my opinion so I don't mean to start an argument in that regard.

So not to get too political, but now we are wondering, what is going to become of us when we are ready to retire?

One of the places we were looking at for retiring was Italy - preferably around Rome or Tuscany. We have visited and I have learned some Italian. I know that it's not as easy as all of that -- I'm not expecting to show up at 65 and tell Italy to "take care of us"...so, my question is, 1) is this at all feasible, and 2) if so, what do I need to do in the meantime?

As an aside, I do know that things can change in 20 years, but it's easier to plan to stay than to leave. Any help anyone can provide would be great.


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## Joppa (Sep 7, 2009)

BabyJane said:


> Hi, all:
> 
> This is my first post, so a little about me because I can't fill out a profile yet.
> 
> ...


The steps you have to take to 'retire' in Italy as non-EU citizens are unlikely to change in any major way, so here they go:

1. You have to apply for long-term, non-work visa for Italy. If you go to the relevant Italian consulate site, you may get a basic breakdown of requirements, but remember, such visas are issued at its discretion, with applications often referred to Rome for a decision, so there is no guarantee that you will get your visa even if you apparently meet all the stated requirements.
2. Basically you have to convince the authorities you have enough guaranteed non-earned income, such as pensions, investment and savings to pay for all your travel, living, accommodation and medical costs in Italy for the foreseeable future, though visa is likely to be only for a year, and has to be renewed. There is no set minimum amount laid down. Each case is judged on its merit. The idea is that you have a secure financial base not to be tempted or foced to work, engage in self-employment or run a business (even online work), which isn't allowed by your visa.
3. You have to provide proofs of suitable housing in Italy, either owned or rented, comprehensive private medical insurance valid there, and often police clearance (such as FBI rap sheet) and medical certificate stating you are free from mental illness or certain infectious diseases.
4. As you haven't contributed anything to Italian social security system during your working life, you are on your own financially, and are expected to meet all your costs in old age, such as personal, residential or nursing care. So make sure you'll have substantial investment or savings to meet likely expenditure and/or take out a suitable care insurance that will pay out in Italy.

While Italy and all other developed European countries try to take good care of their elderly, disabled or frail population, most benefits depend on contribution record to their social security or insurance schemes. It will be a condition of your visa that you don't try to claim assistance from the Italian public purse.

While I don't know how my final paragraph ties in with your stated reason for wanting to retire in Italy, I'm sure you can understand that a welfare state can only be responsible for its citizens and others who have contributed to their social welfare scheme through their working life as a kind of social contract.


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## BabyJane (Apr 17, 2011)

Joppa said:


> While Italy and all other developed European countries try to take good care of their elderly, disabled or frail population, most benefits depend on contribution record to their social security or insurance schemes. It will be a condition of your visa that you don't try to claim assistance from the Italian public purse.
> 
> While I don't know how my final paragraph ties in with your stated reason for wanting to retire in Italy, I'm sure you can understand that a welfare state can only be responsible for its citizens and others who have contributed to their social welfare scheme through their working life as a kind of social contract.


Well, I guess my question really is how can I contribute now so I'm not just a freeloader? Is there a way like living there half the year or something like that?

I am paying into the system here, obviously, but it is looking more like I will have exactly the same issue in the US. I will be on my own in spite of having paid into the system. So if that's the case, I would rather see if I can find someplace that values me at least somewhat...


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## Joppa (Sep 7, 2009)

BabyJane said:


> Well, I guess my question really is how can I contribute now so I'm not just a freeloader? Is there a way like living there half the year or something like that?
> 
> I am paying into the system here, obviously, but it is looking more like I will have exactly the same issue in the US. I will be on my own in spite of having paid into the system. So if that's the case, I would rather see if I can find someplace that values me at least somewhat...


The only way you can be treated as a contributor to social insurance is to spend part of your working life in Italy. It means getting a work visa for Italy, which for US citizens is fraught with difficulty, as your potential employer needs to prove they cannot get EU workers to do your job. One way is to get an internal transfer to a branch or subsidiary in Italy, if your employer offers it. Diplomatic or military posting doesn't work, as you continue to pay tax and contributions in US, not Italy.

Some countries have mutual recognition of social security contributions, but US isn't part of any such agreement.

You can stay for 90-in-180 days in Italy (and the rest of Schengen area) visa-free, but only as a tourist/visitor and not to work, so you can't contribute to the system. If you can get an EU passport, perhaps from Irish ancestry, that will make your plans somewhat easier, though you still have to find a job in Italy which is far from easy because of high unemployment.


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## Bevdeforges (Nov 16, 2007)

As a US citizen and resident, the best you can do in planning for a retirement in Italy is to plan for your retirement however you can. First of all, your contributions to the US social security will count. It only takes 40 quarters (or 10 years) of contributions to be qualified for a pension through US social security. There are a few issues (like the WEP - Windfall Elimination Provision) but for the time being, just make sure you're getting an annual statement of your US social security estimated benefits.

If you have a pension program through your current employers, keep current on that. If it's a 401K or other sort of "self paid" retirement savings program, make sure you're kicking into that at the max for any employer matching benefits. When you hit the magic age of 59 1/2, where you can start withdrawals, you can start to transfer your balances into an Italian or European "life insurance" once you're resident in Italy - which will at least transfer your savings into the local currency and (hopefully - I'm not sure how Italian savings plans work) give you some security regarding the capital amounts you are investing. Short of working in Italy and contributing to whatever retirement scheme they have, this is probably your best opportunity. But most European retirement programs require 40 or more years of contributions, which means you wouldn't be getting much through those schemes even if you moved to Italy and started working right away.
Cheers,
Bev


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## BabyJane (Apr 17, 2011)

Thank you, this was really helpful.


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## whitebird (Dec 12, 2010)

Joppa, you mention getting comprehensive health insurance. Do you know of any good insurance plans? Do they accept anyone or have those nauseating clauses like the US companies have? Thank you for any suggestions.


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## Ed in Italy (Feb 24, 2009)

Bev, I worked for 15 year in the US. Then 20.5 years here in Italy. The last 2.5 years I've been on unemployment. You write that "....contributions to the US social security will count...", but Joppa says "Some countries have mutual recognition of social security contributions, but US isn't part of any such agreement." So now I'm totally confused. I believe I'll be eligible for an Italian pension in a few years IF my US contributions can be joined to the Italian ones. Is this joining possible, and if so, is it a long process? How far in advance should I start this process assuming I could retire in, say, 2013-2014?


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