If you are an American, you are probably grateful for your citizenship and to be living in the U.S. But being an American is also a big advantage when living in many places abroad.
That was a key finding of a survey conducted by the website Best Places in the World to Retire. Approximately 500 expats answered more than 7,000 questions about living in Panama, Nicaragua, Belize, Mexico and Portugal.
Many of them say that it's cheaper to live abroad while enjoying the same or a better quality of life. They are likely to pay less for housing and services. Some say that it's also easier to start a business and that natives admire their country and speak excellent English. Many of the respondents to the survey have enjoyed full lives as expats.
Here are the four most significant ways that being an American gives you a "leg up".
Your U.S. Savings and Income Buys You More Abroad
Expats report that it costs less to live abroad. According to the study, Expat Reports: Is It Cheaper To Live Abroad, 74.8% of expat respondents said that, for the same money, their lifestyle abroad was "much better," while only 1.4% said it would be "much better" in their native country, mainly the U.S.
This means that many expats lead a good life on their Social Security benefits alone, compared to what they would enjoy in the U.S. Mike Cobb, who moved from western Pennsylvania to Nicaragua, said that "for $1,200 a month, a couple can have a very nice life including a half time maid, a gardener when needed, meals, taxes, bus travel, and even 2-3 rounds of golf per week, with membership."
Cobb said that someone could rent a studio apartment in Managua for just $300 a month or a home on the coast for just $800.
These low costs aren't confined to Nicaragua. Many expats compare Panama City, Panama favorably to Miami. Chris Frochaux, who has lived everywhere from Switzerland to the U.S. and now lives in the upscale San Francisco area of Panama City says, "You can get a cleaning lady who charges $20 per afternoon, or a live-in maid for about $400/$500 per month."
The short reason why this is possible is that, while this seems cheap to Americans, it isn't cheap to the locals who live in these areas. That's the cost-of-living advantage of living abroad.
For places that don't use the U.S. dollar (for example, Mexico uses the peso and Portugal uses the Euro), it is not unusual for exchange rates to work in favor of Americans, giving you even more buying power. For example, two years ago, one U.S. dollar would get you 13.2 Mexican pesos, while today, one dollar will get you about 19.2 Mexican pesos. This means that, all things being equal, your U.S. dollar can now buy about 45% more peso-denominated goods and services in Mexico than it could in February of 2014.
"For Americans living in Mexico, it's like walking into a market and finding that the prices have dropped over 40%!" Galindo said.
You've Seen Success and Know How it Works
Living abroad can be an advantage for those who are interested in starting or running a business in places where entrepreneurship and innovation are not as prevalent as in the U.S., and where business efficiency and customer service may still be on a learning curve. These entrepreneurs may have business expertise that doesn't already exist in the local economy. They may import fresh perspectives based on their careers and start organizations with structures that improve on local competitors.
She spoke of a "a couple" that "started a business a few months ago growing sprouts of all kinds to use for cooking or decorating meals. They told me that demand is good since they can offer something different."
This not to say that all American business models will thrive. Success depends as it does throughout the world on the basics: organization, management and the quality of the products and services. However, Americans often possess strong skills and a can-do attitude.
Americans and Their Language Are Popular
The U.S. has less than 5% of the world's population, yet it has an outsized influence on global business and culture. It is more likely that a local in a foreign country speaks English and knows about at least some American culture than an American knows about that foreigner's land, let alone speaks another language. The Best Places in the World to Retire website has found repeatedly that in many places abroad, you don't even have to speak the local language. You can survive on English alone.
Not only does this help you to communicate and fit in easier, but it also gives you an advantage because there are so many people from other countries who are interested in U.S. culture, even predisposed to like Americans. Americans and other expats receive exceptional treatment in places as diverse as Panama, Mexico, Belize and Portugal, and even in places such as Nicaragua where it would seem more likely for them to be resented.
The Fourth Advantage
Some people come from countries where there is limited opportunity. The U.S. with its abundant options for living and working offers a good fallback position.
That is, if you don't like living abroad, you can always return.
This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.