# Newbie Questions



## AlanR (Aug 17, 2010)

Hi everyone. This is my first post to this forum and after spending some time reading and reviewing some of the posts and responses on this site, I am excited about finding the information necessary to make an informed decision about this next journey in my life. 

Some background. I am a 56 year old divorced male, who took an early retirement several years ago, following 25 years as an IT professional. I have been fortunate enough to build up a fairly healthy nest egg, that I would like to use to provide me a lifestyle better than I could sustain in the US.

Over the past several years, I have done a bit of research into other destinations, outside the US, that might enhance this lifestyle, financially, culturally and personally. Among the countries that have appealed to me, based on this research; are Mexico, Panama, Nicaragua and Thailand. It is my intent, after further research, to begin visiting these countries, perhaps on 3-6 month stays, to confirm my research findings.

Because of its proximity to ‘home’, I have chosen Mexico as my first foray in this journey. It is my hope that this forum may provide some answers to the many questions I have. Of course, I won’t ask them ALL in this particular thread, but would like to start with the basics.

Where to visit first:

I am somewhat torn between the draw of the ocean and the peace and beauty of the mountains, and probably would like to experience both before making a final decision. My preference is to live among other English speaking expats, at least initially, as I do not currently speak Spanish (although I intend to learn). With an expected ‘income’ of about $3,000-3,500 per month, I would like to live in a community that can comfortably support that spending level. 

Other factors important to me, as I am sure they are to most, are safety, a relatively mild and comfortable climate for much of the year, access to good health care, proximity to good restaurants and clubs, entertainment venues, water (beach, lake), and a good ‘bang for the buck’ regarding cost of living essentials. Other ‘important to haves’ would be high speed internet access and access to American movies and TV shows (whether via Cable/Satellite or DVD, etc.). Additionally, since I don’t cook and value good nutrition, reasonably priced eating establishments offering healthy dishes, or a cook, that doesn’t bust the budget, is very desirable. Lastly, with family and friends in the Boston, MA. area, ‘reasonable’ transportation cost and travel length would be factors as well.

Some of the expat communities I have read about that appeal to me, on paper anyway, are Puerto Vallarta, Lake Chapala, Puerto Escondido and Oaxaca. Are there good ones I am missing? What are the major lifestyle differences between them? What important questions am I NOT asking?

Meeting FM3 requirement.

Because I am 6 years away from Social Security and about 4 years away from tapping my IRA and pension (which I chose as a lump sum, converted to an IRA, instead of a monthly annuity), I have no official ‘income’. However, I do have about $200,000 from the sale of my house as spendable assets, until I am eligible to draw from my IRA funds. 

Is there a way for me to structure these assets to meet the Mexican monthly minimum income requirements? That is, could I deposit some of these funds in a Mexican bank, or do a monthly automatic transfer from my US bank to a Mexican bank account (or to another US bank account)?

I think I’m getting a little long here, so I’ll stop at this point. I would like to thank you all in advance for any assistance you can provide.

AlanR


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## sparks (Jun 17, 2007)

You don't need a Mexican bank account and I wouldn't even think of it for a few years. Probably the lump sum is enough to qualify for FM3 but monthly deposits to another bank would also work. They don't look at the source of deposits

Check the coast in the summer time ... the humidity may not agree with you


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## RVGRINGO (May 16, 2007)

Your parameters have indicated that you should definitely visit, and spend some time at Lake Chapala (Chapala, Ajijic, Jocotopec area). It has everything you wish and is half a day to the Pacific beaches for a visit whenever you wish, but allows you to live in a truly wonderful climate all year; avoiding the hot & humid coastal climate, which can be unbearable in summer.
Your resources are more than adequate and you might simply consider arranging monthly deposits of about $1200 into a separate account (for some few months before moving to Mexico), which you can use as the account to show proof of your 'income'. Once that is done, you wouldn't need to do it again for five years.
By the way, the term 'FM3' is obsolete. It is now a 'no inmigrante' visa with several classifications. Yours will be 'rentista'.
We've lived here a decade and have never found a need, or desire, for a Mexican bank account. Everything is done online and cash comes from ATM machines.
Welcome to the forum and may you enjoy your first trip to Mexico. Frankly, having traveled to all the other places you have mentioned, I doubt you'll even want to go any further.


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## conklinwh (Dec 19, 2009)

Alan, I went through a similar decision about 10 years ago. I had been living in Asia for 6 years and was pretty convinced that I was going to retire there. As much as I love Bali, my 1st choice was Phuket for basically all the reasons that you list.
Ultimately, I decided that was just too far away from family as at the time I had aging but active parents and two kids in the US so I came back and started looking at other options.
We had visited a number of places when AARP Magazine had an article on "the new retirement zone" which included Puerto Vallarta, Sayulito, the Lake Chapala area and San Miguel. My wife is a painter and I'm a history buff so San Miguel really appealed to us as 1st choice and we really never looked back. Now that we are here, we have spent time in Puerto Vallarta, Guadalajara, Morelia, Guanajuato, Queretaro, Patzcuaro. Oaxaca and are off to San Cristobal in two weeks. I really think you need to answer two questions and then spend time to verify. 1st, do I want all the winter advantages of the beach area and accept the summers or do I want a more moderate year round temperature. 2nd is how far do you want to be from the border. For a lot of reasons, we want a 1 day drive to Texas but others very comfortable with multi-day drives of airline for quick exit.
If answer is beach and I don't care about distance to the border there are lots of options. More limited if one day and will depend on east coast or west coast. If more moderate year round temperature and 1 day drive. You really have two options for what you listed-San Miguel or the Lake Chapala area. I think Oaxaca is wonderful but multi-day and I understand San Cristobal is very european. Patzcuaro may also be a choice.
Sorry for the long note but a lot of options that you need think through. The 180 day tourist visas will let you test a few in multiple seasons.


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## AlanR (Aug 17, 2010)

Thank you all for your quick and informative responses. You have a great site here, evidenced not only by your answers to my questions but from your responses to the many threads I have so far reviewed on this site. Hope someday I can pay it forward to other newbies, as you all have. 

I have a ton more questions, but will submit them as separate threads, to address one topic at a time. And I thank you in advance for all the additional information I am sure you all will provide.

AlanR


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## Tucson (Oct 30, 2010)

If you are willing to expand your search parameters in Mexico, my husband and I would suggest you add South Eastern Mexico to your list. Merida (in the state of Yucatan) and the state of Quintana Roo (home to Cancun and other cities south) are beautiful communities filled with large ex pat populations. Mayan culture, colonial architecture, Caribbean Sea, and good access from major airports are very strong draws. We've owned our condo between Playa del Carmen and Tulum for some time now and love it. Keep your options open! And good luck on the search. 

Mary & Bernie


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## Don P (Jul 27, 2010)

Alan R, I am a little bit younger than you (53), also have retired early and am going to be making an extended trip to Mexico soon to see how I like it. I am not much of a beach person, prefer a moderate year round climate and don't yet speak Spanish so I'm going to focus on San Miguel and the Lake Chapala area on my first trip.

One thing you might consider with regard to your IRA if you aren't aware of it. You can start drawing from it prior to age 59 1/2 without penalty if you make "substantially equal withdrawals" each year for a minimum of 5 years once you start making withdrawals. If you are planning to basically live on principal, i.e. savings, for the next 3-4 years, I presume you will have minimal taxable income and no income tax liability. If you start taking IRA distributions annually based on your remaining life expectancy, you would be taking roughly 3.5% of the prior year end IRA balance; depending on the size of the IRA you might not have much tax liability from that either. If you use a mix of IRA distribution and savings to live on in the next few years it could allow you to take smaller IRA distributions than you would otherwise 4-5 years from now (as you'd have more of the savings outside the IRA left) and save on taxes down the line. Just something to consider and maybe discuss with a tax advisor if you have one.


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