Are retirees really the "wealthy elite" they're often portrayed as? In reality, retirement incomes vary widely, and so do living standards. For expat retirees, the picture is even more complex. Beyond everyday expenses, they must also navigate inflation, hidden costs, rising healthcare bills, and policy changes that can all have a significant impact on their budget.
How much money do you need to be a wealthy retired expat?
Last May, Donald Trump signed an executive order expanding access to retirement accounts and encouraging younger workers to save money, arguing that a golden retirement is within reach for anyone who manages to keep聽USD 465,000 in their bank account聽before turning 65. Economists have been more skeptical, pointing out that the president's projections ignore inflation entirely. According to financial experts, today's USD 465,000 will be worth less than USD 200,000 in 30 years once inflation is factored in.
A month earlier, Trump's former senior adviser Elon Musk floated the idea of a comfortable retirement becoming universally accessible within "10 or 20 years," thanks to artificial intelligence. The tech billionaire outlined his vision of an "economy of abundance" in which saving for retirement would become irrelevant, as AI-powered humanoid robots would take over as the primary workforce and keep the economy running. Once again, however, the dream collides with reality and the steady drumbeat of crises (some see in this yet another revolution, one that could prove devastating for human workers: the rise of the machines).
How much do you need to "earn" to be a wealthy retired expat?
The answer is more complicated than it sounds, as it depends on several factors. Everything hinges on your lifestyle and the country you choose to retire in. In France, you're generally considered wealthy once you earn around 鈧�4,000 per month. The average retiree, by comparison, brings in about 鈧�1,540 a month. That's already too much for those who argue pensions should be cut, on the grounds that retirees are too well-off since they receive the equivalent of a salary, sometimes even more. This argument extends well beyond France's borders. It often comes up in discussions about retirees who move abroad specifically to take advantage of a lower cost of living, even when their income would comfortably allow them to stay home.
Join the community
Get regular tips and advice to make the most of your expat life
The case of Luxembourg
In Luxembourg, the wealthiest country in Europe, the numbers are in a league of their own. You'd need around 鈧�20,000 a month to be considered rich. The minimum state pension sits just above 鈧�2,400, which may sound decent, but needs to be weighed against Luxembourg's notoriously high cost of living. According to the Luxembourg Chamber of Employees, even the minimum pension is no guarantee against financial hardship. Women are disproportionately affected, due to interrupted careers and lower-paid jobs.
In China, the lifestyles of the newly minted billionaires are the stuff of dreams, and not just for the younger generation. There are significant regional disparities: in Beijing and Shanghai, monthly earnings of 15,000 yuan (around 鈧�1,915) are relatively common, while in the remote western provinces, many people struggle to earn 5,000 yuan (around 鈧�638) a month. These wide income gaps translate directly into unequal pension levels, making a comfortable retirement, whether at home or abroad, a distant prospect for those at the lower end of the scale. Because retiring abroad also means accounting for inflation and hidden costs, starting with healthcare expenses, which naturally tend to rise as you get older.
The gap between rich and poor retirees聽is widening
The divide between wealthy and lower-income retirees is growing. According to Northwestern Mutual, the average American would need around USD 1.46 million to retire comfortably. The problem is that most Americans leave the workforce with closer to USD 200,000 saved. In France, a retirement abroad in Greece, Portugal, or Spain is generally considered viable from around 鈧�1,800 per month. In Morocco, that budget drops to roughly USD 916 a month, while in Thailand it sits somewhere between USD 1,300 and USD 1,700.
According to the European Central Bank, the median net wealth of retirees in the eurozone stands at 鈧�185,300, with major differences between countries. In Latvia, the median retirement income is 鈧�36,300. In Luxembourg, it soars to 鈧�1,219,500, hence talk of the "Luxembourg exception." Belgian and Irish retirees, though considered well-off by European standards, have a median net wealth of around 鈧�300,000, which is still higher than in Spain, France, and Germany (ranging between 鈧�200,000 and 鈧�232,000). Italy lags further behind at 鈧�168,000.
Wealthier retirees benefit in particular from growing asset income. They can move abroad with relative ease because they have the security of ongoing revenue streams (rental income, savings returns, and so on), which also makes them less vulnerable to inflation and rising healthcare costs.
Those who rely solely on their pension, on the other hand, are at greater risk of falling below the poverty line. That said, a modest pension doesn't necessarily rule out an expat retirement: a growing number of people are choosing to relocate to countries with a lower cost of living than their home country precisely to stretch their purchasing power. It can be a smart move, provided you can plan ahead for potential changes in circumstances, such as rising inflation.
How to build your retirement budget abroad
Could the answer simply be to save money throughout your working life? Not exactly a groundbreaking idea. In Japan, successive governments have long urged workers to set aside money for retirement. Here too, the advice runs up against the realities of inflation and increasingly precarious employment. Some also see it as a tacit admission that the state is failing its citizens.
As with any move abroad, the first step is to map out your current and projected income and expenses. The key difference for retirees is the potential drop in income: a retired expat will need to make do with less, unless they still have additional income streams (rental properties, permitted work activities abroad, and so on).
You can also improve your financial situation by choosing a country with a lower cost of living than your home country. That said, caution is essential in the current climate, as inflation can quickly erode an expat's budget.
Watch out for hidden costs, especially those related to healthcare. Again, those with lower incomes are most exposed. Retired expats should also keep a close eye on any potential policy changes in their host country, as seen with Thailand's tax reform in 2024.
Freelance web writer specializing in political and socioeconomic news, Asa毛l H盲zaq analyses about international economic trends. Thanks to her experience as an expat in Japan, she offers advices about living abroad : visa, studies, job search, working life, language, country. Holding a Master's degree in Law and Political Science, she has also experienced life as a digital nomad.
