Retirement Lessons From a Puerto Vallarta Christmas

Photo by Pana Vasquez on Unsplash

The tires chirped as we touched down at the Puerto Vallarta International Airport. The level of excitement in our stale aluminum tube grew more boisterous as we neared the gate. Through the little window I could see the bustling white-clad workers and the heat waves rising from the tarmac. To Kristi and me, this was more than a vacation, it was an exploration of a possible future life for us. And hopefully a validation of a crazy idea we had last year:

Can we retire early with less money if we live part time in Mexico?

This trip is a small step towards a big decision — and perhaps just as important — a Christmas in the paradise of Puerto Vallarta with our two daughters.

Here are some lessons I learned from this trip — and a simple calculation of what it would cost to live here:

Expats are tantalizingly chill

PVA is known as one of the most popular places in Mexico for expats to retire. In the downtown and Romantic districts, you can hardly swing at a piñata without hitting a gringo.

We met Bob in an Italian restaurant. He is a stage designer and a snowbird from Boston who was down on his annual winter migration. He had a friendly, unhurried manner and casually invited us to The Rocky Horror Picture Show, playing in a theater up the street. We did the Time Warp with him that night.

Playa Los Muertos is the most popular beach in PVA. I noticed Jerry and Sandi leaning back in their plastic chairs, showing off their golden tans, and smiling with Cheshire grins at all who walked past. I introduced myself and coaxed some retirement secrets from them with a bribe of $2 beers, though they would have gladly given them for free. They live a self-described life of perpetual bliss on $3,000 dollars a month — a king’s ransom compared to many others in this country. They eat out for lunch and dinner every day, frequent the beaches, theaters and clubs, and sip on beers and margaritas whenever the urge strikes them.

For 21 years, Patty has owned a surfing shack and restaurant in Sayulita, a kitschy town just an hour north of PVA. We met her at the beach, sitting behind a folding table under a colorful sunscreen held aloft by aluminum poles. She showed a sincere interest in us as people, not just as fleeting tourists. She arranged a surfing lesson for my daughter and me with a local expert named Arturo, and I learned — to her amusement — that surfing is a sport for the young.

We encountered dozens of snowbirds and expats, each with a fascinating backstory of their own. They came from all over the world, from radically different cultures, classes, ideologies, and religions, and yet they all had one thing in common: Serenity.

During the entire visit, I heard not a single word of anger or frustration uttered by an expatriate.

Pride and Poverty

One night we dined on a succulent meal of fresh mariscos (seafood) at a boutique restaurant on the edge of the beach. It was served to us at sunset on a starched white table cloth, with a nice bottle of wine, and the distant sound of spirited mariachis serenading lucky couples in love. The meal was surprisingly inexpensive — yet it cost more than those servers make in a month.

The Mexican government just raised the minimum daily wage by 10% to about $4.70 (US). That’s less than 8% of the US minimum wage, which many people argue isn’t a living wage.

Interwoven into the fabric of resort towns like PVA are the invisible poor.

They live outside of the city and commute by bus to the restaurants and hotels where they don their neatly pressed uniforms to serve the demanding tourists. Others hike up and down the beaches in the stifling heat, wearing plastic smiles, hawking bracelets, braids, and blankets for a pittance. The woebegone rest in forlorn poses on the hard concrete, gesturing for spare pesos with outstretched arms.

Bathrooms, parking lots, and gas stations are hosted by local entrepreneurs who work for propinas (tips).

I’m admittedly not an expert in social welfare policies, but according to The World Bank, 60% of the population receive some sort of social support. The poorest 20% get half of it, but unfortunately these benefits are severely limited in scope and contribute just a small percentage of their income.

They work hard and proud because they must.

I learned patience, acceptance, and respect, and I handed out coins like candy. A few pesos may be an insignificant sum to me, but they can make a difference in someone’s life down here.

Yes, Virginia, there is a savings

Christmas is “high season” in the resort towns. While the addictive scent of salt water and the soothing sound of rushing waves are free, everything else gets marked up.

Regardless of the season though, PVA can be an expensive or cheap place to live. Your choice — you have control.

Since I’m obsessed with the idea of living here part time, costs are important to me and I kept close track of our expenditures. To achieve my goal of retiring early, the cost to live here must be less than the amount we save by mothballing or renting out our home in the US. My estimates below are based on the equivalent of a middle-class US lifestyle in PVA, but you may prefer a more extravagant or austere life, and for those there are still plenty of options.

Monthly living expenses for two people during high season (in US dollars):

— Rent & Utilities: $1,000 to $1,500

These prices can get you a fully-furnished 1-bedroom apartment just a short walk or taxi ride to the Downtown or Romantic zones and beaches. Renting smack dab in the heart of those zones could double that amount and moving just a bit further out will soften the blow. Sometimes rent includes cleaning and laundry service.

— Food & Dining: $400 to $700

I’m not going to eat out every day like Jerry and Sandi, but once a day seems reasonable. There are plenty of restaurants and street vendors, and even at Christmas the prices were fine. We had delicious and filling meals for as little as $5 to $10 per person. Cooking for yourself with fresh food from the local markets saves more and adds to the fun.

— Entertainment: $200 — $500

This is a widely variable expense of course but personally I’d like to do something at least once or twice a week. There are plenty of bands, shows and culture in PVA, and one benefit of living in a resort town is that there are things to do every night of the week. Of course, one can always snuggle on the beach, listen to the waves, and gaze at the stars. That’s free.

— Local Travel, Miscellaneous: $250

Taxis cost less than $5 to go anywhere in town and buses are only a few pesos. We paid $1.25 to ride a bus for an hour to Sayulita. Some expatriates drive their cars here, which is a great idea if you’ll be bringing a lot of personal gear or you plan to travel to multiple cities. Don’t bring nice cars though, the roads are terrible.

You’ll need to account for a few odds and ends too, such as phone service, clothing, gifts, tequila, and new sunglasses for when they’re swept away in the surf (yep, happened to me).

— Expat Insurance & Medical: $200

The price of medications and doctor visits is astonishingly low and can be paid out of pocket. We bought some behind-the-counter (prescription) medication for Montezuma’s Revenge for only $8. Long-term residents say that emergency insurance is a good idea in case of catastrophe and is very reasonable. General medical insurance, Medicare, and Seguro Popular (Mexican universal care) are too complicated for this blog post — I’ll be sure to address that in more detail in the future.

— TOTAL Living Expenses: $2,000 to $3,200 per month (US)

Summary:

If you’ve never visited Puerto Vallarta, I highly recommend it. I could spend many long months in my retirement years wandering around in flip flops in this beautiful place. The people, community, activities, beaches, and atmosphere are perfect, and for $12,000 to $20,000 for a 6-month stretch, Kristi and I could live a nice comfortable life here.

Yet the question remains: “Can we retire earlier with less money if we live part time in Mexico?”

A simple question and a complex decision. We know the cost here now, but what is the savings back home? Will we save more? I hope so because every dollar leads us to an earlier retirement.

I’ll share a much more detailed cost and savings analysis soon. If you don’t want to miss it, consider following me or subscribing to my blog at RetirementType.com.

Till next time,

Brian Feutz

Lover of reading, and writer of oft-curated articles about retirement, life, and adventure. Editor of Medium.com/life-after-work and www.LifeAfterWork.Zone.

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