Methodology

The Global Citizen Solutions retirement index for US retirees is composed of 8 target-oriented indicators grouped in 3 thematic sub-indices.

Data was gathered from reliable secondary sources, such as Numbeo for cost of living, rent prices, climate, and healthcare system ratings, and from other relevant databases for indicators like the Global Peace Index, Migrants Acceptance Index and English Proficiency Index. For the tax optimization indicator, we established a scale beginning at 0.5, which represents countries with US bilateral agreements to avoid double taxation. A score of 0.8 is assigned to countries that offer special tax regimes for expatriates, and a score of 1 is given to countries that do not tax foreign-earned income. This methodological approach helps to quantitatively assess each country’s attractiveness from a fiscal perspective for expatriates. For the flight availability and distance indicator, we normalized the data by considering factors such as flight duration and the availability of direct flights. This approach allows for a standardized assessment of how accessible each country is for US expatriates, which is crucial for those considering proximity to the United States for travel convenience or emergency return trips.

Establishing normalized indices necessitates the identification of minimum and maximum values. The maxima, serving as benchmarks for ideal outcomes, are pivotal in constructing a target-oriented performance index. The determination of these maxima varies across different variables. Conversely, the minima represent lower performance thresholds, symbolizing the least desirable outcomes.

Each data point was normalized to ensure comparability using Min-Max Normalization formula and rescaling the range of features to scale the range in [0, 1].

Weights were assigned to each indicator based on the relevance and impact of that factor on the decision-making process of US retirees. These weights were derived from publicly available data, research on retirees’ preferences gathered from academic papers and industry experts.

The percentages represent the importance of each indicator in the overall decision-making process.

Missing data was addressed using an imputation method that combines regional averages with proximity-based weighting. Data was first segmented by regions to calculate regional means, ensuring alignment with local trends. Then, for missing values, a weighted average was computed using values from nearby data points and regional means, providing a contextually enriched imputation that maintains both regional and local accuracies, thereby improving the dataset’s reliability for further analysis.

The final index for each country was calculated by multiplying the normalized value of each indicator by its assigned weight and summing these products.

The composite scores represent the overall suitability of each country for US retirees, with a higher score indicating a better match to retirees’ goals. The final scores matches these scores to a percentage representing the extent to which each country meets the ideal conditions for US retirees.

Cost of Living and Rent Prices

Cost of living indices are essential tools for expats considering relocation because they offer a standardized way of comparing the living expenses between their current location and potential destinations. For US expats, these numbers are particularly relevant because they are benchmarked against New York City, which many consider a reference point due to its global significance and the high cost of living.

Numbeo Cost of Living Index Plus Rent Index is valuable for understanding the day-to-day expenses one will face in a new country. It covers the cost of groceries, restaurants, transportation, and utilities, which are regular and necessary expenditures. For a US expat retiree, particularly those from New York City, understanding how living costs in a new country stack up against NYC is vital for financial planning. This comparison is crucial to determine if their income or savings will support a similar lifestyle abroad. This knowledge is especially important for decision-making purposes, particularly for retirees who often rely on a fixed pension from the US. Such an assessment helps them gauge whether their fixed income will suffice to maintain their desired standard of living in a different country. Including rent in the cost of living provides a more comprehensive view of the financial implications of moving to a new country. Since housing is typically one of the largest monthly expenses for expats, understanding how this combined cost stacks up against NYC prices is crucial. This index helps expats estimate total living costs, which is fundamental for financial planning. It also influences the choice of location since areas with a high Cost of Living Plus Rent Index may require higher pensions, salaries or adjustments in lifestyle.

Global Peace Index

Retirees often seek a stable and secure environment to enjoy their retirement years. The Global Peace Index (GPI) focus on societal safety and security, offers insight into the everyday safety of living in a particular country, encompassing crime rates, police reliability, and the likelihood of violent demonstrations or terrorist acts. This information is vital for retirees who wish to live in a place where they can feel safe in their daily activities and within their communities.

The extent of domestic and international conflict in a country can significantly affect the quality of life for residents. Retirees looking to relocate should aim for countries in peaceful geographical regions with lower levels of conflict to avoid the risks and uncertainties associated with such environments. In addition, a country’s level of militarization can influence its overall peace and stability. High militarization may suggest potential conflict or a tense geopolitical situation, which could be unsettling for retirees.

The GPI also sheds light on the economic value of peace, highlighting how peacefulness correlates with economic stability and prosperity. Retirees often rely on fixed incomes or savings, so choosing a country with a stable economy, influenced by its level of peace, is crucial for financial security. A peaceful country is more likely to offer economic stability, which is essential for managing living costs, healthcare, and other critical aspects of retirement.

Migrant Acceptance

A welcoming attitude towards migrants is essential for social integration. The Gallup Migrant Acceptance Index provides information into global attitudes toward migrants, highlighting a stark contrast between different regions and countries. For instance, Eastern European nations, particularly those from the former Soviet bloc, show a lower acceptance of migrants. This contrasts sharply with some Western Europe countries such as Spain and Portugal, which top the list as the most accepting of migrants.

Educational attainment and demographics significantly influence attitudes toward migrants. The data suggests a direct correlation between higher levels of education and greater acceptance, with younger generations and urban residents generally more welcoming. This trend underscores the impact of socio-economic factors on perceptions of migrants, where knowledge and exposure play pivotal roles in shaping attitudes.

It’s important to note the distinction in acceptance levels based on the migrants’ origin and status. Economic migrants and forcibly displaced individuals from less developed countries often face greater challenges in being accepted compared to expatriates or retirees from more developed nations like the US. This disparity highlights a nuanced global perspective on migration, where the background and circumstances of migrants significantly influence their acceptance in host countries, reflecting broader themes of economic disparity and international relations in the global discourse on migration.

Climate Index

A moderate climate is often preferred by retirees as human beings feel more comfortable in temperatures ranging from 18C and 24C ¹The World Health Organization says the optimum air temperature for the body is between 18C and 24C. Mild temperatures are even more important when the considered population are children and people over 60.. The climate can affect the types of activities available to retirees. Those who enjoy outdoor pursuits like hiking, gardening, or golf may prefer a climate that supports these activities year-round. The Climate Index can help identify locations where the weather aligns with retirees’ lifestyle preferences.

Climate conditions can also influence living costs. For example, extreme temperatures can lead to higher expenses related to heating, cooling, and clothing. By choosing a location with a moderate climate, retirees can potentially reduce these costs, contributing to a more affordable retirement.

While the Numbeo Climate Index provide a general overview of a location’s climate likability, retirees will consider their personal preferences and health needs.

Healthcare

Elderly individuals often factor in their future health when considering their living arrangements, with some viewing relocation as a strategic investment in their health and well-being.  Healthcare costs in the United States are among the highest in the world. Many US retirees face the challenge of managing their healthcare expenses within a fixed income. By relocating to countries with more affordable healthcare, retirees can significantly reduce their medical expenses while still accessing quality services. As retirees age, the likelihood of requiring medical care increases. Choosing a destination with an efficient and affordable healthcare system ensures that they have the necessary support and resources available as their healthcare needs evolve over time.

Considerations relating to mental health and positive environment for retirement are also factored in when deciding a place to relocate. The healthy aging perspective posits that individuals are proactive in maintaining their physical and mental health, seeking ways to enhance their life quality despite health challenges. Engaging in leisure activities is noted as a method for promoting healthy aging, and retirement migration offers opportunities to access better healthcare or favorable climates, which can positively impact one’s perception of health and reduce certain chronic conditions.  In this context, warmer and more stable weather conditions are often associated with improved mental and physical health. Consistent sunshine, for example, increases Vitamin D levels, which is crucial for bone health and has been linked to a lower incidence of depressive symptoms. Mild temperatures can also encourage outdoor activities, which promote physical fitness and reduce the risk of obesity, heart disease, and diabetes. Additionally, a favorable climate can alleviate symptoms of chronic conditions such as arthritis, as warmer temperatures can help reduce joint pain and stiffness.

The concept of healthy aging includes the proactive search for environments that improve mental health, suggesting that retirement migration can be a transformative phase for individuals seeking a new start, especially after significant life events or when societal expectations around retirement prompt a desire for change.

Seeking to help expatriates to compare healthcare delivery in different countries,  Numbeo Health Care Index  provides a comprehensive evaluation of the quality of healthcare systems, considering the expertise of healthcare professionals, the availability and modernity of medical equipment, and the efficiency and competency of medical staff. For retirees, who typically require more medical attention as they age, ensuring access to high-quality healthcare services is a top priority.

The Index offers insights into the accessibility of healthcare services in different countries, including the availability of doctors and the ease of obtaining medical care. This is particularly important for retirees who need to ensure that they will have timely access to medical services whenever needed. It also provides information on healthcare costs in various locations, helping retirees to choose a retirement destination where they can afford the healthcare services, they need without compromising their financial security.

By assessing the healthcare infrastructure and resources, the Index helps retirees understand what to expect in terms of hospital facilities, medical equipment, and the availability of medications and treatments. This is crucial for making informed decisions about where to live, especially for those with chronic conditions or specific medical needs.

English Proficiency Index

Understanding the level of English proficiency in potential host countries is a crucial consideration for US expat retirees. This knowledge can significantly impact their cultural integration and social interactions in the new environment. Learning a language extends beyond mere translation; it involves immersing oneself in the local culture, understanding nuanced social cues, and engaging with the community on a deeper level. The 2023 EF English Proficiency Index is derived from over 2.2 million EF SET test results worldwide. This test assesses English reading and listening skills, correlating well with other major English assessments.

For retirees, this means being able to form meaningful connections, participate in local events, and navigate the subtleties of daily life in a foreign country, which are all essential for a fulfilling expatriate experience.

Moreover, the English proficiency of a host country can greatly affect retirees’ access to essential services, including healthcare, legal assistance, and customer support. In countries where English is widely spoken, expats are likely to encounter fewer obstacles when seeking information, resolving issues, or accessing services crucial for their well-being. This ease of communication is especially important for retirees, who may have more frequent interactions with healthcare providers and require clear communication to manage their health and legal affairs effectively. In sum, countries that are more English-friendly tend to have thriving expat and migrant communities, increasing the likelihood of forming connections and building supportive networks.

In emergency situations, the ability to communicate effectively can be lifesaving. For retirees living abroad, navigating emergencies in a non-native language can be daunting. A country with a higher level of English proficiency can offer a sense of security, ensuring that expats can communicate their needs, understand instructions, and access emergency services without the added barrier of a language gap. This peace of mind is invaluable for retirees seeking a safe and secure environment in their chosen host country.

Tax Considerations

Tax optimization is an essential factor for American expats, particularly retirees seeking to maximize their pensions and savings in their golden years. Countries around the globe offer varying tax benefits, which can significantly influence the decision on where to settle post-retirement. For American retirees, understanding the tax implications of residing in a foreign country is as crucial as evaluating the local lifestyle and healthcare services.

For the tax optimization indicator, we established a scale beginning at 0.5, which represents countries with US bilateral agreements to avoid double taxation (Double Taxation Agreements – DTAs). A score of 0.8 is assigned to countries that offer special tax regimes for expatriates, and a score of 1 is given to countries that do not tax foreign-earned income. This methodological approach helps to quantitatively assess each country’s attractiveness from a fiscal perspective for expatriates.

Flight Duration

For the flight availability and distance indicator, we normalized the data by considering factors such as flight duration and the availability of direct flights. This approach allows for a standardized assessment of how accessible each country is for US expatriates, which is crucial for those considering proximity to the United States for travel convenience or emergency return trips. Even though the world is increasingly interconnected and flights are more widely available today, expatriates still prioritize locations that allow them quick and easy visits back to their home countries. Particularly after the pandemic, which led to a sharp increase in airfare and heightened awareness of travel restrictions for health and safety reasons, the convenience and affordability of travel have become key considerations in choosing a relocation destination.