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So how do you pay your monthly bills if you can’t rely on them being there on time?
Rent, phone, electricity, insurance etc…You would be taking a big risk, and I don’t know about you, but I prefer to follow the book so I can sleep at night…
Plus if you take the money out of the Vanguard, and have to pay the penalty, why not just pay for the house? Maybe I’m missing something…
Plus, again, I know you probably fell in love with a specific house down there, but if it’s at the beach they will be a lot cheaper by the time you actually move down, and renting for a while is recommended anyway. Someone I know lived in that area for a year and thought it was a pain every time they had to go to San Jose. It’s just wise to really make sure you like it before you make such a large investment.
I don’t know ‘how’ the IRS would find out if you live in the “rental” but, the consequences seem to dire for me to try:
“Using a rental property for personal use may disqualify the entire self-directed IRA. So, assume you use $100,000 from a $1 million self-directed IRA to buy a condo at the beach. Even if you use the condo just two weeks a year, the entire $1 million IRA could be disqualified. Here’s how the IRS explains it:
However, in this case, with an individual retirement account, instead of imposing an excise tax on the parties to the transaction, the Code provides that the account is no longer an individual retirement account, and it is treated as if the assets were distributed on the first day of the taxable year in which the prohibited transaction occurred. (Code §408(e)(2))
The result would be a hefty tax bill and penalties. And that’s not good for anybody. So, as I noted at the start, a self-directed IRA can be a source of capital for investing in rental property. But the rules are complex, so you should seek the advice of a tax and self-directed IRA specialist before launching full bore. “
Found this at:
http://www.twowiseacres.com/financing-rental-properties/using-a-self-directed-ira-to-invest-in-real-estate/I think it is very brave of you to make this move on your own with two small children!
I would try to find other parents in the area you want to move to so you have a support network.I don’t know what skills and interests you have, but maybe doing work over the internet for a company in US or elsewhere would be a way of making money for the 2-3 years it takes to get permanent residency. As long as the income comes from abroad it is legal to work. Or start a business down there that you would have to hire Costa Ricans to work in.
Good Luck! Hope the father is on board with the move so you don’t get custody troubles by taking the children out of the country.
Yes, you can buy property through a self-directed IRA, but you can’t live in it yourself or use it as a vacation home for yourself.
If it was me I would look into what the tax consequences would be to pull the money out and maybe decide it would be worth it to put it in gold bullion instead while I look for property and rent for a year or so in CR. Bullionvault.com has a vault in Switzerland so that gets the money out of the country right away.
If you are looking for property along the coast you should be able to find better deals in a year.
If you are going to sell your home in the states, you better get on it real quick, and accept that you will get a lot less for it than you wanted. Best to list it at a price close to the lowest you will accept right away or you will have to accept a price much lower later on or not get it sold at all. I don’t think many people are getting mortgages anymore, and cash buyers are scarce. Super important now to stage your house as nice as you can, get rid of all clutter and address all problems. You will have to work it yourself and not rely on a realtor. Put ads on Craigslist with really good photos, hold your own open houses as often as you can. Where is your house? Let me know how to contact you, maybe I can help.
If it was me I would put them in school AND home school them regardless of where in the world they live. School is an important place to learn interpersonal skills and the culture of the country they will grow up in, as well as make friends, and with the parents is where you really learn while doing the home work. I would also teach them all the things I consider important in life that they don’t teach in school, such as finance, cooking, fixing things, building things, how to think, how to learn, where to find information, how to manage relationships, etc.
I think I will go with the dehumidifier and use it religiously – we will have hydropower from the river so hopefully the electricity use won’t be too much of a problem.
Has anyone heard of a whole house dehumidifier system, as opposed to having individual units being eye-sores in each room?Also, I’m thinking if I close the doors when the fog rolls through the house or when it rains heavily I could keep some moisture out.
I think it would be great if we could contact each other without having to post our email address on the board for everyone to see.
I’m looking for some as well… heard of someone who is importing them from the States, hope we won’t have to. Please post info here if you find something out later on.
Thanks.Nonetheless, 35K is outrageous to pay for architectural fees!
We recently worked with an architect in San Diego, California and the fees where going to be $5000 for a 1500 sqft home.The construction costs were going to be between $100-$150 per sqft depending on finishes. I wonder when I see construction costs in Costa Rica that rival those here. Sure there is cheap Mexican labor here, but they still get $10/hour, not 1$/hour like in Costa Rica.
Andy, I came across this page, and thought of your question: http://soyawannamove.com/costarica/jobs.shtml
Sounds difficult to get a licence if you didn’t go to university in Costa Rica…
But maybe a way to make money could be to design and develop your own properties and sell them. I’m guessing you’d need to have local architects sign off on the plans.
If it was me I’d find it a lot more exciting and creative to work with my own vision rather than trying to satisfy clients. You would need some capital of course… but it could start on a small scale with a very modest size but very functional vacation home. There has got to be so many expats/vacationers that are looking for something inexpensive and don’t need a big house.I’m not a professional but I’m obsessed with design and architecture, would love to meet up with you in Costa Rica when you get there! I’ll keep your email if you don’t mind.
My guess is that it is relatively cheap to vacation in Costa Rica, so it can still be done even if the economy is bad. I mean, how exciting is it to go to Vegas for the 50th time…? And Hawaii is relatively expensive.
Also, every time I mention that I’m moving to Costa Rica, every single person has heard of it and knows how beautiful it is and knows at least one person who has recently been there. And about every 3rd person I talk to mention the International Home buying show on HGTV as the place where they found out about Costa Rica. I guess it has hit critical mass in people’s consciousness.
If you are working for an employer outside of Costa Rica, and the money is coming from another country, how can that be illegal? According to the legal advice I’ve been given you shouldn’t need work permit for this situation, but that advice could be wrong of course…
I would ask a lawyer.From what I understand the UV radiation is highest at the equator so living close to it may not be the best for you unless you spend most time indoors.
I have fair skin, burn easily and don’t like being in the sun much, was actually hoping that lots of rain would mean lots of clouds, but that may not stop the UV rays…
I’m no expert, but it’s something worth researching further.
I am also looking for a legit tax consultant, but for US and Costa Rican tax laws.
The only one’s I’ve found on the internet seem very shady. I’m not looking for any kind of tax evasion, but rather to make sure we don’t make any mistakes.Let me know if you can recommend anyone in the US or in Costa Rica.
