Live a Better Life - Live in Paradise - Live Work Retire in Thailand

Insurance & Financial Planning

This is a complex topic, which is not our area of expertise. We do know several reliable advisors who we can refer you to for your insurance needs and to help you with financial planning.

In a nutshell - everything costs more than you think. So budget generously, and add a good dollop for all the unexpected (or overlooked) costs. Don't forget to factor in the occasional trip home, or the relatively expensive car you might want to buy one day. Furniture and appliances add up over time, as do computer and photographic equipment and hobby purchases such as golf clubs, yoga or muay thai classes, the tropical fish tank, etc. etc. You'll probably also want to splash out occasionally on an exotic holiday at a resort (which can usually turn out to be far more expensive than a regular stay at a hotel or guesthouse).

The cost of moving your belongings can also be a killer. If you have a household of stuff then moving to Thailand can set you back a good $8000/£5000. Moving between towns costs around $700/£450. And don't forget any residual costs at home, like storage costs, accountant fees (for your annual tax return), bank fees and maybe the cost of maintaining an address and phone number.

Also decide what kind of insurance you need. You won't need as much medical cover if you are living in Thailand compared with USA. The most complex heart operation at Bangkok Heart Hospital will cost about $30,000. Most other private hospitals will charge half this. If (when) you do eventually die in Thailand, you might not want to bother with the expense of sending your corpse home. Why not just have it cremated at a local wad (temple) for a donation of around $300?

If you do have assets that you want to liquidate then you must consider the tax implications. You also might have significant transfer costs and lose money in the exchange rate 'spread' (usually around 2%). You may wish to consider buying gold coins that have legal tender. In the USA, you may take out $10,000 in legal tender, and if it happens to be Gold Eagle coins then that's still acceptable! Check what is legal tender. Krugerrands for instance, is not legal tender. A $50 coin is 1 oz, which is worth around $1,600 in gold. So $10,000 = 200 oz, or $320,000.

Shop around when it comes to buying gold, because the 'commission' can be quite hefty, as much as 4% over the spot price. I think this is considered justifiable because gold is expected to dramically increase in value over time (even moreso, percentage-wise, than it already has), and quite likely to mania levels similar to the late 1970's, but possibly with no "bubble" at the end like before. When you convert your gold back into Thai baht, you'll usually pay very little commission (around 0.5% and rarely over 1%).

If you already own your own house or apartment then you might consider renting it rather than selling it. A rental income can be used to live off indefinitely in Thailand, and the advantage is that your income stays in line with inflation. It's hard to know whether your property will ever gain in sufficient value to be able to sell at a good profit (most people will barely get their money back, and will certainly lose on any improvements they might have made to their property over the last few years).

This is a tricky judgement call. It can go two ways, and it's anybody's guess: either the American economy recovers, perhaps in 10 or 20 years time, sufficiently for people to be able to afford to buy property again (at a price that gives you a good return on your investment), or nobody will be able to buy property unless it's at well below equity prices.

Here are a couple of suggestions (which are as good as bad as any 'expert') that you may wish to consider:

  1. Hold on to your property and live off the rental income until such time as it's right to sell. if it never increases (or even drops) in value then you simply continue to live off the income, which is unlikely to drop as there will always be a demand if the property market is sluggish.
     
  2. When you are ready to buy property in Thailand then sell your property at home for the best price you can get and buy a permanent home in Thailand. So long as you have some other source of income - such as a pension or your online business - then you are covered.

Insurance

It's worth having medical insurance. Household, contents and liability insurance isn't typical here. You can get contents and all-risks insurance in case you get burgled or you lose stuff, but it's expensive.

Medical insurance is cheap. It doesn't really matter which product you buy, the premium is usually around 1% of the cover. You don't need as much cover in Thailand as elsewhere. Buy separate travel insurance whenever you leave Thaialnd, it'll probaby work out a lot cheaper.

Make sure that you are covered for accidents on motorbikes (most insurance policies exclude this)and also check whether your policy is renewable for life (some will not allow you to renew after 70, or after a serious accident/illness). And also make sure the policy covers you for "dread diseases".

Term Life insurance is comparatively expensive in Thailand and I don't know why. The premium is around 4%.

As always, contact us if you think we can help you or if you'd like us to put you in touch with an expert professional advisor.

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