Retiree Marsha Scarbrough relocated from the United States to Madrid in 2016 at the age of 70 due to her concerns about the political climate in America. She found that moving abroad not only provided a respite from growing domestic tensions, but it also ended up saving her a lot of money.
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Here, Scarbrough breaks down just how much she has saved by relocating abroad.
Cost of Living in the US vs. Spain
Scarbrough estimates that her cost of living in Madrid is half to one-third of what it would be in the U.S.
“I spend about $2,500 a month — that’s $30,000 a year,” she said. “That does not include vacation travel or dental emergencies, but it does include taxes.”
In June 2023, the California Department of Housing and Community Development reported that a single person making less than $70,000 a year in Los Angeles — where Scarbrough was living at the time she relocated — is considered low income. In Orange County, California, the threshold is $80,000.
“In Southern California, I’m less than half of low-income,” Scarbrough said. “I’d be living under a bridge with the 75,000 unhoused residents of L.A. At $30,000 in Madrid, I´m not even low-income — I’m comfortable.”
Scarbrough said that she saves at least $40,000 a year by living in Madrid versus Southern California.
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The Biggest Cost Savings for a Retiree
Scarbrough said that “the savings on healthcare alone would make the move worthwhile for most people.”
“With Sanitas, one of Spain’s biggest health insurers, the cost for a healthy 64-year-old couple living on the Costa del Sol would be €297 ($319) per month,” she said. “That’s for two people with no deductibles and no co-pays, including basic dental. The cost increases as you age, but it is about equivalent to paying for Medicare, Medigap and Plan D.”
At 77, Scarbrough pays about $201 a month for her healthcare coverage.
“That’s just $26 a month more than Medicare Part B, and it covers 100%, not 80%,” she said. “I don’t need Medigap or Plan D. The cost of prescriptions is so low, it’s laughable.”
Scarbrough also saves big on housing — she pays about half as much for rent as she did in Los Angeles — as well as on dining out.
“Eating in restaurants — with no tipping — is a fraction of what it is in the U.S.,” she said.
Unexpected Costs To Be Prepared For
While Scarbrough is saving big by retiring abroad, she did say that it’s important to take taxes into account when considering total living costs.
“Taxes were an unexpected expense simply because I didn’t research them properly,” she said. “Spain taxes your worldwide income at rates higher than U.S. rates. How much you pay depends on your income level and assets. It’s different for everyone.
“It is not a big deal for me since I don’t have much money, but anyone considering the move needs to consult with a Spanish tax advisor and get an individual estimate,” Scarbrough continued. “Usually, the healthcare savings and low cost of living more than compensate for the higher taxes.”
The Benefits Are More Than Financial
Scarbrough appreciates the cost savings that come with retiring abroad, but that’s just one of the perks for her.
“Cost-of-living savings alone are a great reason to retire to Spain,” she said, “but in addition to savings, you get a high quality of life – first-world infrastructure, personal safety, efficient public transportation, excellent healthcare, sunshine and abundant joie de vivre.”
For more from Scarbrough, see her interview with International Living.
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This article originally appeared on GOBankingRates.com: I’m a 77-Year-Old Retiree: Here’s How Much Money I Saved by Moving to Spain
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