First of all, let me explain a couple of acronyms:

DIF:
The State System for the Full Development of the Family
(Desarollo Integral de la Familia)

INAPAM:
National Institute for the Greater Adult People
(Instituto Nacional de las Personas Adultas Mayores)

INAPAM, the Senior Discount Card I’ve already written about, is for both natural residents of Mexico and for foreigners (legal residents) holding an FM-3 or an FM2 visa, over 60 years of age. (This is about the same as the older INSEN card – so, update to a new INAPAM card for maximum discounts.)

To apply at your local DIF office, found in the state of your residence, you will need:

1. Passport,
2. Photo ID (passport or driver’s license),
3. Valid FM2 of MF3,
4. Proof of current residence in Mexico (utility bill in your name, deed to your residence, rental lease,
5. Three photos (similar to your passport and usually there is a person within the area to take those photos, so they fit the requirements),
6. Emergency contact information,
7. Birth Certificate.
Make at least two copies of everything to take in to the office.

I do list the Mexican Embassies, located in the United States, in my book, Retire In Luxury. The list is found on pages 67,68 & 69.

There are a few handicap parking places in Mexico

The DIF office in Mexico City: 
Sistema Nacional para el Desarrollo Integral de la Familia
Zapata 340 P.B.
Sta. Cruz Atoyac, 03310
México D.F. (Districto Federal)
Tel. (55) 30032200

The Mexican Embassy in D.C. is:
Embassy of Mexico
Consular Section
2827 16th Street, NW
Washington, D.C. 20009-4260
202-736-1000

Well, Christmas is almost here. Only a few more days to go. All of the family will be getting together for Christmas dinner… and of course to open presents!

I just received this email and it prompted me to write today’s blog post. It’s from Barbara B. in Yucatan. She writes:

HI, Barbie. Well here we are in the Yucatan.  Can you tell me, can we buy a pickup here and put the title in both our names?  

In one of your letters you said something about people over 50 could get a card for discount on busses and tours etc. Can you tell me where I can get a card?  I am 81 and my husband is 86 years young. Thank God there are people like you who can help us old folks! Thank you so much. Barbara B.

First of all, Yes, Barbara!  You can buy a pickup and put the title to it in both names.

Now, let’s delve into one of my favorite things – saving money!  Yes, even in Mexico, residents and retirees can say “Senior discount, please” and be rewarded.

The National Institute of Older Persons, a Federal program administered by DIF (Desarrollo Integrál de la Familia) was designed to enhance the quality of life for all legal residents, Mexican and foreign, who are over the age of 60.  This “Senior Discount Card” was originally issued only to Mexican citizens and foreigners holding an FM-2 immigrant visa, but now it is now available for anyone holding FM-3’s also.

You’ll receive various discounts… on your pharmacy purchases…. discounts on your water bill, discounts to concerts, transportation, clinics, bus fare, festivals, movies, restaurants and lots more. You can read more about the whole program here.

Here’s how you get your discount card:

First find the DIF office in your part of Mexico. If there isn’t one, ask at the local government office where you should go to apply.  As with any office in Mexico, hours may be limited –and even their supplies. Try to go early and take a book or something to fill your time in case you have to wait. Be sure to bring with you:

• passport
• birth certificate
• valid FM-2 or FM-3 residence visa
• photo ID such as your passport or driver’s license
• proof of residence (a utility bill in your name, deed to your home, or rental lease, etc.)
• 3 photos in “infantile” size (smaller than passport size. Any passport photographer will know the correct dimensions)
• contact information for someone to be contacted in case of emergency;

Make sure you bring least two photocopies of everything on this list.

With all this in hand, you should be able to obtain and physically walk out of the office with the discount card in your hand.  You’ll find the constant use may wear them out, so laminate your cards.  You’ll probably want to make a couple of copies of them for future use too.

And that’s how you can get your senior discount!

So what do you think, folks? Do you have a question about life in Mexico? Are you ready to retire? Would you like to make a comment or a suggestion? If you don’t see the “COMMENT” field below, simply follow this link to the complete article and tell me what you think!

Rest assured thousands of people have already done it. Mexico is where they live, work, and play. People from all walks of life are living the good life for a lot cheaper than they could do it anywhere else.

Indeed, Mexico has it all: Lower healthcare costs, pleasant weather, idyllic lifestyle, and so much more. Mexico will help you save money on practically everything you need right now. Imagine slashing your living costs by a third… or even a half. That’s a lot of money in your pocket!

So what will your life be like in Mexico?

How much does it really cost?

Most importantly, how do you get started?

This article answers all of these questions for you. My newsletter, my free reports and my books provide you all the information you need.

If you’re looking for the perfect place to retire… a place to vacation to… a place to escape the winter months, you’ll discover why more and more people are choosing Mexico to make ends meet — and getting more bang for their bucks.

So read all about it! I’ve got lots and lots of information waiting for you right here, so dig in and enjoy.

Oh yes… and I almost forgot! If you feel like commenting on any article, please by my guest.  At the end of each article, there’s a little “add comment” feature — so feel free to make use of it. I *do* get a lot of email and keep pretty busy, but I guarantee you will always get a reply from me!

Verl writes: “Thanks for your correspondance. We are planning a trip in July to possibly purchase in the Lake Chapala area. It is difficult from here to get the real scoop on the most desirable retirement spots and then the best neighbourhoods, we’re shooting in the dark.  And we think we should purchase now before prices go through the roof.”

And so, I introduced him to Charlie after assuring him that to hurry the process is not wise – prices have leveled off just as they have in the States – relax – shop around.

Charlie has  rented a three bedroom, two bath home, with a maid’s casita and bath, garage, patio and nice yard about 30 miles south of Ajijic on the other side of the lake for $200 a month.

He lives in Ajijic while looking for a permanent place and paid the Ajijic prices for everything and out here it is about half.  Even the food, and pharmacies are cheaper because it seems that here everything is priced for the economy of the town.

A few months with the Gringos in Ajijic and it was an easy decision, Charlie said. It wasn’t an economic move but being away from the Gringos who do drive the prices up where ever they go it certainly turned out that way.

You may remember the article in AARP magazine that offered Lake Chapala at $800 a month. Well the Gringos drove it up to an easy $1200 to $1400 a month.

Well, Charlie is here to tell you that if you don’t desire the hubbub of the crowd and you don’t mind a 25 or 30 minute drive to the larger towns tell your folks that $800 a month is a breeze.

He writes, “You know the climate & beauty here, the people in the country, like in the U.S., are more friendly and helpful than city folks and the only thing we don’t have out here is the noise of the city.

 ”My advice to a prospective person coming to Mexico is to rent for a few months and look around for what fits their economic and social desires. There is something here for every one. In my community I don’t spend or act like a Gringo and I am accepted as a member of the community.”

For some the answer is “beauty”, but for the vast majority of American’s and Canadians, the number-one reason is “affordability”.  Meaning: “Cheap retirement”.

You see, the wage scale and cost of living in Mexico is why people want to live there.

While American dollars can be a tremendous boon to the local economies of many retirement havens and enclaves, our dollars can also backfire on us if we are not careful.

Many retirees and tourists make the mistake of showing off their dollars. They want to feel “rich and powerful” or they feel guilty because they aren’t paying enough. How do they do this? By leaving huge tips. By over-paying. By flaunting their money or giving it away in exchange for common courtesy — something which has always been free in any culture.

And when prices increase, retirees aren’t the only ones who suffer. What about the natives who are “priced-out” of the basic neccessities of life?  Expats aren’t the only ones who need to live cheaply!

Let me tell you a story:

The first year Jim went to Mexico, he felt embarrassed by the extremely affordable meals, goods, and rentals available  — so he covered his discomfort by leaving large tips everywhere. 

The next year he went back, and found the prices had risen,  but still affordable.  He continued leaving large tips that year, still assuaging his guilt over the still very inexpensive prices.

The next year he went to Mexico again, and found he could barely afford the higher prices that were becoming an everyday event. 

Jim struck up a friendship with a restaurant owner and eventually broached the subject regarding the seemingly never-ending increase in the cost of groceries, the cost of renting, the price of meals and prices in general. The restaurant owner frankly replied, “As long as you Americans want to pay a lot, we can accommodate that. We will find out just how much you are willing to pay for your apparent embarrassment for being rich!”

As far as Social Security, the nay-sayers and dooms-dayers say it won’t be there – but, even if is, (and I can’t imagine any politician who values their political life not working to keep it functioning) then it will be an added bonus!

Ways to do it:

If your employer offers retirement savings plans – take full advantage of them. Contributions are taken out of your pay before taxes – and the savings will earn interest, and you won’t be taxed until you – usually in retirement – take the distributions. And, believe me, in retirement, most of us have a lower income – ergo – lower tax ratio. Win-win – you saved, let it gain interest, and the taxes will be less when you receive the money. If your employer offers a matching plan – take full advantage of it! Contribute as much as is allowed. Same scenario as above paragraph, plus you double your savings!

Once you have a plan established, don’t borrow on it! You’ll find it’s almost impossible to replace the money you already saved – and you’ll be paying back interest too boot!  Keep your eyes open for penalties! If you take distributions before 59 ½, those withdrawals may have penalties!

So, try to wait until at least age 62 to retire – you’ll find health insurance can be a huge expense on your own – try to hang in there until 65. Medicare is wonderful! 

 Now, assuming you’re a bit nearer that golden year of retirement, and have already put the above plans into action, here are a few thoughts to ruminate:  Your retirement does not involve only yourself. Your spouse or partner is going to take that ride with you.

Sit downand have many discussions about your hopes, your expectations, your desires you have for the future years. Dick and I have always found a lot of easy conversation while driving and relaxing – find a comfortable setting and share.

Figure out just where your income is going to come from and how much you can plan on receiving – here, a financial advisor may come in handy. Most banks have that service offered for free, but we’ve found you can get a lot of information by just getting out pencil and paper and doing some figuring!

By now you should have a budget figured out – see where you can cut down, where you will be able to save. Use coupons and take full advantage of sales. You’ll probably find that during retirement, you’ll have more time than money, so make a game of coupons… and don’t forget to always ask for the good old “senior discount”! Dick and I would feel really bad if we were to pay full price for almost anything anymore! 

Just for the fun of it – go though last year’s financial records. Find out just what you actually spent for the year, and see where you can cut down. Even if you have unlimited funds, you should feel very proud not to just waste money.

And what a wonderful lesson to pass on to your children!

Now, you should be in full retirement mode – but – woops – what happens a little later…when the car needs a major repair, the roof starts to leak or the plumbing gives up the ghost and needs a major rework – or maybe your washer just stops in the middle of the spin cycle, never to spin again? All those savings you’ve been able to put away will be a life saver.

Expenses don’t stop just because you retire!

Think you can’t buy real estate in Mexico? Think again!

In places formerly off-limits, foreigners can now acquire irrevocable and absolute ownership rights to property through a 50-year, perpetually renewable, and transferable, real estate bank trust called a “fideicomiso”.

With a Fideicomiso, you have the same property rights in Mexico as we do here in The States with deed.

What is a fideicomiso? It’s a bank trust secured by the Central Bank of Mexico. It is a 100% legally-binding instrument which entitles you to deeded ownership of real property in Mexico. The fideicomiso was created specifically for non-Mexico citizens to enable them to own property in the formerly restricted zones.

You see many years ago, to protect Mexico from having the wealthy countries buy all the desirable land (near the border and coastal areas) the government of Mexico created the Fideicomiso.

In 1997, Mexico joined the International Banking Standards community — and thus a fideicomiso permits non-Mexican residents to own property in Mexico. (You might be interested to know that  Most banks in Mexico are now owned by various international banks, such as Citi Bank and Chase Manhattan — so that’s one of the reasons why Mexico had to adopt the International Banking Standards.)

A “trust” is a “trust” just about every where you go and it works the same way here. For citizens of other countries, title will transfer to a Mexican bank, which acts as trustee of YOUR interests (making you the beneficiary.) There are specific banks that have been authorized by the Mexican government and are allowed to hold a Fideicomiso.

In a nutshell, here’s how a Fideicomiso works:

• The land is put in a trust issued by the federal Mexican government.
• The trust owns the land.
• You own the trust.
• The bank administers the trust. The bank has no ownership rights to the trust.  They cannot “take it back”.
• Trusts are now for the duration of 50 years, with the right to renew for 50 more years at the expiration date.

What are the basic requirements of a Fideicomiso? It’s simple.

1) You must have a valid passport.

2) You must have a valid credit card (the bank trust charges are charged to this credit card).

3) And if you are in Mexico, you must have the tourist visa issued by the Mexican government when you entered the country. You have to possess an FM-3 Resident Immigrant Visa. An FM-3 costs approximately $98.00 US per year, per person, and is renewed annually. It allows you to keep a US plated vehicle in Mexico, to leave and return at will, open and maintain a Mexican bank account, and can exempt you from capital gains tax when selling and allows you to purchase property in Mexico.

When you purchase a home in Mexico, you will pay:

1) The Negotiated Price of the Property — This amount we know, as it is fixed at your agreed on purchase price.

2) The Bank Trust (Fideocomiso) — This charge can vary depending on the bank you choose, but be prepared for approximately $2,250 US. A portion of that fee is for the bank, but the bulk is paid by the bank to the federal Mexican government. This fee covers all the trust documents, permits and the first year’s administration fee.  And don’t forget closing costs which include:

• Title search to ensure the person selling the property is actually the owner or has the legal power to sell the property.
• Lien search to make sure there is not a hidden claim on the property.
• Appraisal to set the tax value.
• A new plot plan showing the lot dimensions.
• A new deed, verifying all taxes, phone bills, water bills, and electric bills, etc.
• Registration of the new deed once everything is complete and all fees have been paid.
• The acquisition tax, paid by the buyer in Mexico. This is fixed at 2.2% of the purchase price.

So, what are the actual costs?  This again is a variable. An approximation is: for a $150K to $200K property, about 4 to 5%, and it drops correspondingly for higher values.But…about all the charges you’ve heard rumored you’re going to be hit with… don’t get scared…they aren’t nearly as bad as you thought they would be.

A sale becomes registered (final) when it is witnessed and recorded by a Notary Public (Notorio Publico in Mexico).

At that point, title passes to the designated Bank to be held in Fideicomiso (Trust). The specific Banks authorized by the Mexican government designated to hold the Fideicomiso must pass diligent Mexican government inspection. The chosen Bank reviews all paperwork of the current owner/developer to ensure the documents are complete and legal. There are a number of Banks in Mexico who have been authorized by the Mexican government to hold the Real Estate Fideicomiso.

Title is delivered to the Bank who has been authorized to act as the Trustee.  The Bank reviews all paperwork of the owner/developer to ensure the documents are complete and legal.  The buyer is designated the Beneficiary of the Trust. The Beneficiary retains the use and control of the property and makes all the investment decisions.

It’s really a pretty simple process as long as you have someone you can rely on, like my friends in Mazatlan, who know how the process works.  I can put you in touch with them easily, they are contractor/realtors and have a very capable staff.

Just Some Good Old Common Sense Hints:

When looking at used homes, bring a small appliance with you – a hairdryer would work. Use it to check the electrical outlets – just to make sure the plugs work and that there’s actually an electric wire attached to the plug. Ask to look at the owner’s most recent water bills.  This is the easiest way to detect leaks in the plumbing.

Okay, having your dream home in  Mexico is totally possible now, legally. Please, please, don’t try getting around the legalities in Mexico. Quite differently from the
United States, they don’t put up with that! And…good for them!

The Fideicomiso also protects your beneficial rights under guidelines provided by the Mexican government and their constitution, basically gives the owner of a property full control of that property. The sole concern of the bank is to manage the property for the benefit of the owner of the trust. Trusts are established for initial 50-year periods and are in perpetuity renewable. You, the beneficiary, may build upon, tear down, add to, improve, mortgage, sell & will, etc. You can transfer or assign you interests to any person and keep the profits from sale of the property, subject to applicable tax laws and expenses.

Property held under a trust may be passed on to future generations, and the person to whom the bequest is made is not burdened with inheritance tax.Investors should contact a contractor/realtor who has a qualified attorney who can walk you through each step. 

The Bank will not issue a developer the right to apply for and form a Fideicomiso on their lots until they are satisfied with all documents and satisfied that the subdivision process has been completed. When title to your property is in a bank trust, there will be annual administrative fees set by that bank.

From the first, when I started researching the possibility of retiring to Mexico as a U.S. citizen, I heard that foreigners can not own property in Mexico. Then after learning that was a misconception, I still heard…Yes, but you can’t own near the coast… Wrong again!

Mexican law now allows foreigners to own real estate where once it was forbidden. Ownership of land within 50 kilometers (approx. 30 miles) of the coast is made possible by setting up a Bank Trust.

There are laws governing foreign ownership of land within 50 kilometers of the coast or 100 kilometers (62 miles) of the border. To ‘buy’ property in these areas, it’s very simple – you need to use a “Bank Trust” a Fideicomiso — that legal, government-sanctioned System. 

Just remember: Buying real estate in Mexico is easy. All you need is a fideicomiso — and you can feel safe and secure because  you have the same rights in Mexico with a Fideicomiso as we do here in the States through a deed. Yes, it’s that simple!

The Mexican Tourist permit, FMT, allows you to remain in Mexico up to 180 days, and is available from airlines and ports of entry – that’s what you fill out when you’re on the plane – or ship. 

You can use an FMT permit to enter Mexico for leisure or when you think you are ready to look for property you may want to invest in – either for retirement or perhaps recreation while you are still working. 

You will need the FMT if and when you purchase a property, and usually your realtor or developer in Mexico will be able to help you with any questions you may have about your visa. Check with the nearest Mexican Consul (not tourist office) for current requirements, as they do change from time to time, but not a lot.

Requirements for remunerative (you are planning on making money) visits or longer stays (over 180 days) require special permits from the Mexican Consulate. 

It is not necessary to have an attorney for this process. For extended stays in Mexico, you must apply for a Visitor permit (usually an FM3) and state what the purpose of the visit is.  The latest fee information is available at your local Mexican Consulate.

An FM3 entitles you to bring household items with you, if you decide to move to Mexico.

With an FM3, you no longer need to renew your car permit every 6 months.  An FM3 gives you one year permission to be in Mexico, with four extensions of one year, for a total of five years.

Full resident status entitles you to all rights and benefits of a Mexican National (live, work, claim state benefits and to pay taxes) but you cannot vote in Mexican elections. These permits may also prohibit work in specific industries.  You do not have to surrender your natural Citizenship to be granted full resident status in Mexico.

Because of that, I feel I can offer you truly objective information about building or buying a home in Mexico. If you need to buy or rent in Mexico, just let me know. I keep a constantantly- updated list of friendly, knowledgable, trustworthy builders and realtors who may be able to help you out.

My husband, Dick, and I know a few things about building and remodeling. We always have a project going on… like our guest bathroom currently in progress!! We basically put our boys through their schooling financially (a 4-year program??? – what a great concept!  ) by “redoing” homes. We were “flipping” homes before we knew what that meant!

Dick and I both know which end of the hammer to use and how to do plumbing and even electrical. I plastered many walls and ceilings back in the days.

Yes, I still have my own tool box. From the first, all the handles of my tools have been painted pink :) Two reasons for that – I like them pink, and our boys absolutely refused to use “Mom’s pink tools”! So I always knew where they were!

Here’s a video of home-building and new homes in different areas of Mazatlan. But remember, not only are new homes available in Mexico, there are Mexican areas where you can purchase a home and you will most likely, be welcomed into the neighborhood.

And, if you do need to contact a reliable builder/contractor/realtor in Mazatlan – just let me know…I’ll put you in contact.

Homes and Condos in Mexico:

That’s right, don’t wait until you cross the border to exchange your money.

First, you don’t know if you’ll be able to find an exchange service.

Secondly,  exchange “centers” are generally more expensive than banks because they will charge you a service fee.

Oh… and beware any guy on the corner offering exchange services. He may offer you a whole stack of paper money that can look appealing, but may be worth 50 cents.

Yes things like that do happen.

Thus, you probably should always try to exchange your U.S. dollars for Pesos at a bank. Especially when you’re not that familiar with the going exchange rate. The banks will almost always give you the correct and best exchange rate.

U.S. You can also safely go to a casa de cambio, where you may or may not get a bit lower exchange rate than the bank is offering, but you may not have to stand in line so long.

Just check the rates posted – there are many of these cambios and the rates vary day to day!

A few people who are just beginning to consider moving to Mexico for their retirement years and some who are now ready to decide just what area will fulfill their dreams of retirement have emailed me asking just how, in my opinion, they should best experience Mexico so they can be sure they are choosing the right area for them to live.

Please, don’t just pack up and head down on a tour bus or an “all-in-one” planned tour… not for this important venture. Not for your retirement.

Take charge of your trip – do your research first, have a list of places and things you need to check out. A tour is great, but it’s not going to show you what the real Mexico is. In other words, don’t go with the idea that you’re just going on an elaborate vacation. Go realizing you are looking at a potential place to live.

Go shopping for groceries where the natives go. Wal Mart is great, but go to the market place, too. You’ll be amazed at the quality and variety of foods offered, fresh, and very reasonable! You’re sure to see lots of things you’re not at all familiar with. That’s all part of the charm and fun of a new location. Remember, this is your retirement adventure.

Some of the best information that I didn’t even think of obtaining came from a lady I stopped in a grocery store. We talked for 20 minutes and Dick and I received a wealth of information from her and her husband, who finally came walking down the isle, wondering just where she had gone :)

You really want to spend your time talking with people who live there. Start up conversations with people at little restaurants where the natives go. Start conversations up with people in the shops. You just may even end up with a new good friend!

Do find the American organizations in the area. I list some that are in I list some that are in Mazatlan in my book, Retire In Luxury Talk with the people there …you will be so welcomed!

See what day-to-day life will be. You don’t want a sanitized version of life in Mexico. Not everyone who lives in Mexico goes to a fiesta every night.

Learn what the real Mexico is like. You’ll probably truly fall in love with it. You’ll still have plenty of time to enjoy the beautiful days and your evenings relaxing and having fun! Sure, you want to do the sightseeing stuff …just make sure you do your investigating first!

Logically, and sensibly, your choices should be based primarily on your finances. Do you want to do a lot of traveling? If you choose that lifestyle, then why would you start looking for a large home, with a lot of upkeep demanded?

You may decide to just stay put – perhaps near family – in the home you’ve been in for years.   Or, have they already scattered so you are free to move where you can really make the most of your retirement years, and just enjoy their visits ?

Some of our friends, retirees also, have felt they must have extra bedrooms and baths for the relatives who come to visit (usually once a year). Just contemplate… how much would it cost you to simply rent a motel room for them, compared to the upkeep and expense of having that extra space you’re going to pay for??

Think of the original cost of the extra room, the extra taxes, the heating and cooling, and just the upkeep!

You can pay for a lot of overnighters in a motel for what you will pay for that extra room that isn’t even used 95% of the time. And it’s usually a wonderful break – for everyone – to part at the end of the day for some private time and recuperation time!

Do you plan to do a lot of entertaining – either family or friends? Again – why get a humongous home you’ll be constantly cleaning and keeping up, when friends are just as comfortable in a more intimate setting.

Remember, you and your friends are getting older each year, and the wild parties of your 30’s and 40’s possibly are not the evenings you will be experiencing in retirement.

Keep your taxes low, keep your utility costs low, and enjoy a higher, more leisurely lifestyle like you can do if you move to Mexico.  We’ve fallen into the nicest concept…It’s called “pupu parties” … I guess it’s Hawaiian for hors d’oeuvres party. You just call a bunch of friends – they each bring a nice snack, your supply the drinks, and it’s a wonderful, easy, inexpensive and casual get together. Not too much work for anyone, and a great reason to get together with friends!

If you have a lot of equity in your home, (I always stress that hopefully by the time you are contemplating retirement, it is paid for) and you should decide to sell it, buy smaller, have less expenses, put the profit into an investment portfolio and enjoy the interest.

Then, you may decide to just stay put – in the home you’ve been in for years.  Just realize that air conditioners eventually will need replaced and the plumbing – possibly, etc.  And if you have a lot of equity in your home, if you sell it, buy smaller, and put the profit in the bank – voila!  Interest to help with expenses, or to grow for a long desired item!

Don’t overlook renting – an apartment or a condo – everything is secure when you take those trips, and you won’t have to own a lawnmower or snowblower anymore!

Your retirement maybe be just around the corner, or it may be along way off, but from this day forward it’s up to you – and no one else – to save enough money to live on happily after retirement.

As far as Social Security benefits, the nay-sayers and dooms-dayers say it won’t be there – but, if is, then it will be an added bonus!  But, long before your retirement date, you should contact your Social Security office, and get all the information you can – they can tell you when you can start drawing on Social Security, and how much you can expect to receive – invaluable information for planning your life!

Suggestions: If your employer offers retirement savings plans – take advantage of them – they are taken out of your pay before taxes – and the savings will earn interest, and you won’t be taxed until you – usually in retirement – take the distributions.  And, believe me, in retirement, most of us have a lower income – ergo – lower tax ratio.  Win-win – you saved, let it gain interest, and the taxes will be less.

If your employer offers a matching play – take full advantage of it!  Contribute as much as is allowed.  Same scenario as above paragraph, plus you double your savings!

Once you have a plan established, don’t borrow on it!  You’ll find it’s almost impossible to replace the money you already saved – and you’ll be paying back interest too boot!And you may be taxed twice – when it was earned and again when you withdraw it at retirement.  Keep your eyes open for Penalties!  If you take distributions before 59 ½, those withdrawals may have penalties!  So, try to wait until at least you qualify for Social Security and their insurance to retire – you’ll find health insurance can be a huge expense on your own.

Then get your finances in order.

Of course, if  you’re soon going to hit that magic age, it may seem a bit late to worry about.  But, hopefully, you’ve learned to be a bit frugal along the way – put a little bit away – learned not even to try to keep up with the Joneses ( Like the pitiful guy on the television commercial who shows off his beautiful house, his big new car, the golf club membership and then admits “I’m up to my eyeballs in debt!” – poor guy – no – poor stupid guy.)

My husband, Dick, and I learned years ago it’s not how much money you bring in, it’s how wise you are using whatever that amount is. So, clear up those credit card balances before you are ready to retire and then make it a practice to alwayspay your credit card off each month.  We also feel you should try your very best to have your home paid off – no mortgage in otherwords.

Remember, you’ll most likely want to downsize – why worry about having to clean and care for a 4-bedroom home when you really just want to go get another round of golf in?  Hopefully you can sell that big money-drainer and get something easy to take care of and put a good chunk of cash in your pocket.

I have a chart in my book that actually has the figures and compares living expenses where welived with those expenses we would probably experience in Mexico. Actually, during the time Dick and I were exploring in order to decide where we would spend these precious years, we had charts for everything – and we even had a chart about what we wanted in a house what would be really important to us – what was necessary and what we’d like but could do without– we really are detail folks, I guess!

The only things we can absolutely count on is death and taxes.

Now, why in the world do we find it easy to talk taxes all day long, but just can’t voice the word death?

Live your life to the fullest, prepare, then, face the fact – we’re all going to pass away – nope – folks we’re gonna die…eventually…so, prepare for it.

Make that time is as easy on your loved ones as possible. You made sure the car had gas before letting your teenager drive it, didn’t you? Well, make sure you at least do that much preparation and thought to those who survive, when you die.

Health-Care Proxy gives the designated person who you specify, the authorization to communicate your wishes regarding end-of-life medical treatments. Medical Power of Attorney gives an individual you specify the authorization to make medical decisions for you in the event you are unable to make decisions for yourself.  Usually “Trusts” contain these documents – just make sure you have them, and distribute them to the proper individuals. 

Important – no – VERY important things to do:

Make a list for your executor – whomever you name to handle things after you die. You don’t have to hand all this information to your executor, but make sure they know exactly where you have placed the envelope that contains all this info. (And, no, don’t put it in a safe deposit box at your bank – whoever you designate to handle your affairs may not be allowed access to your box!)  I’ve got the password to my computer on the inside of Dick’s underwear drawer!

Things to put on an information list for your executor:

• The location of your will or Trust documents (which should have most of this info already listed within it).
• Where the deed to your home is. Or, if it’s mortgaged, who holds the deed and how much the payments are and when they should be paid.
• Names and contact information of family and friends (Another reason Dick will need to access to my computer – my address book.)
• Where you have filed all personal information, such as birth certificates, Social Security numbers, marriage licenses, etc.
• Name of the institution where you bank and where they can find the list of all of your account numbers.
• Location of all insurance papers and account numbers – Life, Home, Car and any others.
• Location where they will find a complete list of your assets along with the account numbers – such as house, cars, vacation home, savings account, checking accounts, IRA’s, investments, etc.
• How to turn your computer on and where you have placed the password! And the passwords to any programs they may need access to such as Quicken.

Okay – so I’ve given you some homework to do. Oh – one more thing – make sure that all members of your immediate family know how to pay the everyday bills – the TV, the phone, etc.

Make sure your partner actually knows how to write a check. Show them to write the dollaramount beginning clear to the left, leaving no space to the left, and to draw a line from thatamount to the end, so that numbers can’t be added onto at the beginning or the end. Nevermake out a check to “cash” – if you loose it and someone finds it, they can cash it.

I think it’s just downright unforgivable to never include your partner in the important job of keeping track of the finances. Sharing the chore will make them feel capable and secure.

Yes I’m a Senior Citizen!  I’m the life of the party …even if it lasts until 8 p.m.  I’m very good at opening childproof caps…with a hammer and I’m very good at telling stories…over and over and over.

The same as a lot of us, he is older by a few years, than she.  So once he retires, they both face the possibility of losing the medical insurance he is carrying now.  If he is 65 when he retires, then he’s covered… Medicare.  But, she may still be faced with paying what I consider exorbitant insurance rates.  Same problem as Dick and I ran into.  And believe me, that can eat into your savings.

My husband, Dick, retired at 62 so we had approximately 3 years of paying right around $800 a month for our medical coverage.  We were absolutely thrilled when Dick finally reached the golden age of 65 and… Medicare!  And of course my insurance costs still stayed skyhigh until I also turned 65, 4 years later.

How do you get around paying those exorbitant insurance rates before Medicare takes over,  I don’t know… we never found a way around it.  Of course, if neither of you are working and don’t have a job to be responsible for, you can move to Mexico.  The only hitch here being, pre-existing conditions may cause you to be turned down for private insurance in Mexico.  Even the national insurance requires certain conditions be met.  So we scrimped and saved and made it through a stressful time.

Now, since Dick and I were faced with these costs, Dick retiring from his stressful job because of his health problem and me not working because I’ve always been a stay-at-home Mom, we had pretty good impetus when Dick finally turned 65 to search diligently for the very best Medicare supplemental we could find.  As we were in the states, due to Dick’s pre-existing condition, which limits our time in Mexico, many, many hours were spent searching on the Internet and attending informational seminars put on by the regional insurance companies.

We got such an education.It seems every company promised they were the best… sort of reminded us of timeshare presentations… but this time we needed to buy their product.   After making charts and graphs and trying to think of every question that was pertinent and getting answers on the phone, at the seminars, from friends, we finally decided upon what sounded the best.  Our plan has a zero, monthly payment for our supplemental insurance.  I guess we’re very fortunate in this area to have supplemental insurance such as this offered to us.

I know my sister in Ohio is paying what I consider a large amount for her supplemental insurance… she’s four years older than I… but I guess there’s no other plan offered in her area that is as good as ours.  She and her husband have excellent coverage, but they have to travel miles to mediocre facilities for treatment. 

As you can see we have different opinions on many things.  When we had kids in school and we were in the process of moving, the first thing we checked out were schools.  Now that we are retired, medical costs and coverage and facilities are a prime concern. I remember when we were originally searching for a place that we would love to retire to, thinking Belize would be a little Paradise. 

Then one day I got an e-mail back from a gentleman I had been corresponding with and he had experienced Belize personally.  His response to my query about medical facilities was “primitive”.  Really put a quick end to my dreams about having Howler Monkeys in our trees, Jaguars, Ocolet and Puma in our back yard!  I would rather have a doctor living in my vicinity.

Now it would be wonderful to think that none of us are going to need doctors, but face it… we’re not getting younger and it’s great to have someone who can help us out in our time of trouble. 

Just a matter of fact, since we have retired, I’ve had a torn Achilles repair of my right leg,  my second back operation, I just went through the cancer under the fingernail bit -yes I know that’s very unusual, and it’s doing great now, and just about three weeks ago.  I had my last knee’s torn meniscus repaired.

Maybe by now you’re thinking I should be a little bit more careful… that’s what Dick says… but hey….  I don’t want to miss out on anything.  I am walking a bit more carefully right now however.

So anyway folks, I guess my message is this is something you are going to have to plan for too.  And when you finally get that magical birthday…maybe the big 65… there are a lot of decisions you’re going to have to make. 

Hopefully you too will be fortunate enough to live in an area that offers little or nothing  a month for your supplemental insurance.  It may take a lot of checking out, but it’s certainly worth it.