A litle advice on retirement in Costa Rica, please

[RobSg]

Hi-
This is my first message on this forum. I am a soon to be retired teacher. I am 61 years of age and been teaching since 1970. Mostly I’ve been in international schools abroad, and am in one right now. I will be returning to the States in June and will hopefully proceed with my plans to retire or semi-retire. If I ask a few questions, it would be so helpful if you could answer them based on your considerably greater experience than my own about Costa Rica.

I prefer to try and get the Pensionado Status, but do not know even after reading the comments on this forum if I have a good chance. Her are my questions.

1. I have considerable investments with TIAA-CREF, a company like Fidelity but geared for people in education and research for retirement. When I annuitize part or all of my investements it will allow me to have a “pension” of between US$48,000 to US$62,000 per year depending on how much I want to live on and how much I want to keep in my investments to use later on to offset inflation. My questions concerns if others have satisifed the requirements for Pensionado Status by having a retirement plan showing a non-revocable income that last a lifetime. I sometimes get the feeling that the Pensionado Status only applies to those with government pensions or social security. Am I wrong (I hope). This first question is the one that really concerns me.

2. I can get Social Security at 62, but it is a minimal $450/month, since my years of time overseas. I will qualify for Medicare, however. Can I get the Pensionado Status without using my Social Security but instead using my TIAA-CREF retirment plan?

3. I have a pretty hefty bank account also, but will hesitate to buy property for a year so that I can live there and see if Costa Rica is the place Ireally want to be. I’ve been there a few times already, but not for long periods of time. Is renting for the first few months a good thing to do?

4. Am I required to obtain a lawyer to handle my residency. I know about the ARCR, but do I pay them or do they obtain or recommend a lawyer on my behalf? How does this happen? For example, I believe I need the following:
1. Birth Certificate
2. Police letter (no record)
3. My letters verifying Income.
Do I submit these or do lawyers submit them on my behalf.

5. Do most potential Costa Rican retirees move there first as a tourist to handle the paper work or do you take care of all the paper work before you move down. How did you handle it?

6. On average, how long does the process from beginning to end to get the Pensionado Status last?

Thanks so much for any answers you might be able to give.

Regards,
Rob

[DavidCMurray]

Rob, I’ll take a first shot at answering your questions.

Based upon what you’ve written, your eligibility for pensionado residency appears to be a foregone conclusion, so rest easy.

1 & 2. If your TIAA-CREF provides a lifetime and irrevocable pension of at least $600US per month, and if you can get them to document that in a form that the Ministry of Immigration will accept, then you can qualify for pensionado status. Others have done so.

You might consider purchasing a minimal annuity now and leave open the option of buying another annuity later on. You’ll shortly be eligible for Social Security, so your short term income needs will be a little less.

3. While not everyone does, the general advice is that you get a good feel for Costa Rica before you make a commitment. Yes, renting for a while is a good plan.

4 – 6. You are not legally required to have an attorney act on your behalf to obtain your residency, but it is highly recommended. The residency application process is a bureaucratic nightmare and an *experienced, knowledgeable* attorney is a great asset. There are attorneys affiliated with ARCR who do this stuff for a living. Other residency experts, not affiliated with ARCR, will do equally well for you. The ARCR affiliates, I think, work on a standard fee schedule. We used one, to whom we have referred a number of friends. All of us have been very pleased.

There are also attorneys who are not experienced and knowledgeable who will represent you with varying degrees of success and at varying costs. Go with a winner.

The bureaucratic process of obtaining your residency is a moving target. Rather than rely upon my advice (based upon the truth as we knew it in 2005), or anyone else’s here, you need to retain the right attorney, meet him or her, get the facts straight as they are today, and do what you are told. Follow the attorney’s advice to the letter. It matters.

Depending upon Immigration’s whims at the moment, you may need more or less documentation, especially with regard to your income. And since you appear to have some flexibility with regard to planning your retirement income stream, it might be well to consult the attorney handling your residency application before you commit to a particular annuity plan.

You need to have this meeting in person and you need to budget enough time to do what you need to do here in Costa Rica. For instance, you must go to the central police station to be fingerprinted for an Interpol background check. You’ll also need photographs which Immigration will accept. Your attorney can guide you through all that.

Finally, the length of the process is indeterminable. The word on the street is that Immigration is an enormous bureaucratic mess. Our residency application took six months. Yours could take much, much longer. The good news, however, is that once you have submitted a complete and acceptable application to Immigration, your attorney can issue you a letter to that effect which absolves you of the need to leave Costa Rica every three months. You are no longer technically a tourist, even though your residency application has not been approved. Point is, the delay doesn’t matter.

Hope this helps. If not, ask again.

Edited on Jan 13, 2008 05:44

Edited on Jan 13, 2008 05:46

[pranaspakeywest]

While we’re on the subject of residency….
Is there a short and quick answer to what is needed to qualify as invester/business residency?
If one were to purchase property and build out as a guest house, is there a way to use the money spent to qualify for residency this way?
I only mention “short and quick” because I don’t expect to get all of the info here, I expext an attorney will be my source for that.
Thanks for any info.
Mark.

[rf2cr]

My understanding is that getting residency based upon investor status, especially using a “guesthouse” or your house as a B&B is extremely difficult. The immigration department is getting a lot more strict about these sorts of investments and requirements are very difficult to satisfy. You might wat to email Javier at Residency in Costa Rica (jzava@pacbell.net) and ask him if it could be done.

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