How to Move Abroad Part V

We are finally ready to make our move to Ajijic, Mexico. We just moved into a new casita in the center of Ajijic.

I have been chronicling our experiences in this blog and on the Repurpose Your Career podcast. I have been discussing our experiences on the podcast and writing about the business side of the move here on the blog.

You can find all of the blog posts and podcast episodes where I am chronicling our journey and the decision-making process on the How to Move Abroad and Take Your Job With You Series Page.

I want to discuss today the technological, financial, and legal challenges.  You can make a lot of assumptions about all 3 areas, and you would probably be wrong most of the time.

Look for the next Repurpose Your Career podcast episode to cover:

• Shipping food supplements and medications from the U.S. to Mexico
• Healthcare
• Health insurance
• Automobile insurance
• Leasing property in Mexico

Why Are We Doing This?

The number one factor in making this move is the absurd behavior of our federal government, healthcare, and health insurance industries.

I wrote about this a few weeks back in my post The Looming Healthcare and Insurance Catastrophe for Baby Boomers.

What I predicted is coming true. My health insurance provider has asked the Texas Insurance Board for a 34% rate increase for 2019. I am already paying $1358 per month for a $10,000 deductible bronze level policy for my wife and myself. It is time to move on.

Exploration

We are on our third exploratory trip to the North Shore of Lake Chapala, to the city of Ajijic, Mexico. We previously explored San Miguel de Allende, Mexico and Cuenca Ecuador.

The plan was to come for 3 months and find a long-term rental that would start in January. The rental market is so tight that we immediately changed our plans and found a fully furnished 2 bedroom 2 bath casita in the center of Ajijic. Our total cost (rent, electricity, and gas) should be under $1000. This is about 30% more expensive than we had planned for because of the tight rental market.

At the time of publication, we would have been in the casita for one week and very much enjoying it.

Look for more details on the rental market, the move, and healthcare in next week’s podcast.

Technology

I have written about this multiple times, but it bears repeating, we are not living in a big city in the U.S. A lot of creature features that we have grown accustomed to, are not here.

Internet

The big story here is to have a backup plan if your business depends on Internet connectivity. The podcast episode that releases the same week as this blog post is a good example. I was forced to leave the AirBnB house we were renting to record the podcast episode.  Power first went out due to a power transformer blowing up during a big thunderstorm, and this happened just after they replaced power lines in the neighborhood. Power was out for almost 3 days with no indication when power would be restored. Once power had been restored, the Internet connection was very unreliable for many more days.

This is not an unusual occurrence. When utilities fail, you should expect them to be off for an indefinite period of time. This includes telephone, Internet, and power.

TelMex, the incumbent telephone monopoly, provides Internet service for most people in the area. It is at best a mediocre service providing 5 – 10 Mb download and .1 – 1 Mb upload. Service is very inconsistent and unpredictable.

In comparison, my Google fiber service in Austin provides 300 Mb up and down.

Backup Plan

My backup plan was to tether my MacBook to my iPhone and run the Internet over the AT&T LTE network. When that works, and it often does not, I get 20 Mb up and down. More than sufficient bandwidth to run video calls.

Why is the AT&T network a problem? There has been an explosion of Smartphone usage in the last year or two. Both AT&T and TelCel have struggled to keep up.

I will be signing up for TelCel’s home Internet service, which runs over their LTE network, when we return in November. I cannot order the service while living in Mexico on a tourist visa. Both AT&T and TelCel offer this kind of service and require a 2-year contract. You are probably saying, “A 2-year contract!?!” Well, the cost is only around $18 per month.

Between my Telmex service, TelCel home Internet service and my U.S. AT&T service from my iPhone, I should be able to get reliable Internet service.

Voice Communications

I have a U.S. AT&T account that allows calling to and from Mexico and the U.S., and I have been having two different problems. Where we stayed for the last 2 months, is in a hole between 2 cell towers. If I sat in the middle of the living room and did not move, calls worked fine. If I moved into another room, or even outside, all bets were off. The second issue was it was common for calls to drop for no reason.

We have moved to the center of Ajijic which should solve this problem. I will be ordering an LG flip phone from Telcel and sign up for one of their packet plans. I can buy a simple flip phone for about $50 from a TelCel agent and I can recharge my account by going into any OXXO store in Mexico. This could be done online, but not with a U.S. based credit card. See banking section below. Besides, OXXO stores are everywhere.

I want a Mexican phone with a Mexican cell phone number for traveling between the U.S. and Mexico by car. When we return to the U.S., we will upgrade my wife’s iPhone and trade it in. I will upgrade my iPhone but keep my current iPhone 6s. I will unlock it and when we return to Ajijic in November, I will get a TelCel account for it.

This means I will have a current iPhone on the AT&T network with a U.S. telephone number, and an older iPhone with a Mexican phone number on the TelCel network. My wife will take the TelCel flip phone for calling in Mexico, and use the AT&T for calls to the U.S.

There are a gazillion ways to do this, but we want to keep our U.S. based phone numbers and have Mexican telephone numbers, to make it easy for local service providers to reach us.

Finances

On the north shore of Lake Chapala, very few merchants take credit cards. If they do, they charge you a fee to use the credit card.

I have been withdrawing money from ATM’s at the maximum the ATM will allow, usually between $250-$380. Fees and exchange rates vary a lot. With a lot of experimentation, I found 2 different banks that gave me similar exchange rates and fees. It is not unusual for ATM’s to run out of money on the weekend. You have to have a backup plan.

Banking

It is possible to open a Mexican bank account with a U.S. passport and a tourist visa, but I have not found anyone who has successfully accomplished that. This is Mexico, and what you are told is possible and what you can actually accomplish can be quite different. When we return in November, we will stop at the Laredo, Texas Mexican consulate, and I will apply for Permanent Resident Visa. This will allow me to open a Mexican bank account.

I will open a bank account in the U.S. at BBVA Compass, and then open a Mexican account at BBVA Bancomer. These accounts can be linked, and I will be able to transfer money when the exchange rate is in my favor.

There are other advantages to having a Mexican based bank account including being able to pay individuals and businesses via the Mexican banking electronic payment system. Rather than paying the plumber with cash, I will be able to pay him/her electronically. Similarly, I can acquire a Mexican credit card which I will able to use on Amazon.com.mx or other online non-U.S. retailers.

This is a big deal. To rent the casita in Ajijic, I had to get almost US $3,500 in cash to make the down payment. This was a lot of trips to the ATM over a month period to accomplish this. I will talk a lot more about this in the podcast episode.

Legal

Career Pivot will continue to be an Austin, Texas-based business. I will need to acquire an Austin address for the business which will likely come from a service equivalent of PostScanMail.com.  All business for Career Pivot will pass through U.S. based financial institutions.

Visa Types

You can live in Mexico with 3 different types of visas. These are:

• Tourist visa or FMM – You are limited to staying 6 months but can import a U.S. plated automobile for 6 months.
• Temporary Resident – This is good for 1 year and can be renewed annually for a total of 4 years. You can import a U.S. plated automobile for the length of the visa.
• Permanent Resident – This has no time limits but you cannot import a U.S. plated automobile.

There are different financial requirements for the temporary and permanent resident visas. The vast majority of retirees come in on a temporary resident visa, and after 4 years, convert to a permanent resident. They simply do not have enough savings or income to qualify for a permanent resident visa initially. You have to demonstrate you have approximately $100,000 in investments continually over the past year or have had an income of $2,400 per month, to qualify. The average baby boomer has far less than $100,000 saved for retirement.

Our Visa Plans

I will apply for a Mexican Permanent Resident visa in Laredo on my return from Austin. This must be applied for from a Mexican consulate in the U.S. Most people first apply for a temporary resident visa, and later move to a permanent resident visa after 4 years. The problem with having a permanent resident visa is you cannot bring a U.S. plated car into Mexico on a permanent resident visa. Only on a tourist or a temporary resident visa can you apply for a temporary import permit (TIP) to bring an automobile into Mexico. This gets complicated because the Mexican government does not want your U.S. plated car in Mexico. They want you to buy a car in Mexico.

My wife will return on a tourist visa and we will later be able to acquire a temporary resident visa for her in Mexico. She will obtain the TIP for the car on this trip.

Needing to Prove Legal Marriage Status

In order to acquire a temporary resident visa for my wife while in Mexico, I will not just need a marriage certificate, but a certified marriage certificate. There is a special term for this that I cannot remember, but I need to get my wife’s and my marriage certified by the state of Texas. There are stories of foreigners who have not been able to take their spouse’s body after death because they cannot prove to the Mexican government that they were married.

I engaged with an American lawyer who supports the expat community. He reviewed the lease, my business plan, and immigration status. Basically, as far as the Mexican government is concerned, I am retired. I can receive no income from a Mexican business or individual, which should not be an issue.

You need legal counsel to accomplish this. This is not a DIY process, but the cost of engaging a lawyer is quite affordable.

What Else?

I will be covering in the podcast episode:

• Shipping food supplements and medications from the U.S. to Mexico
• Healthcare
• Health insurance
• Automobile insurance
• Leasing property in Mexico

These are much more personal in nature, and I want you to hear some of my frustrations, angst, and joy.

This move will likely produce a $50K shift in our annual budget. The financial difference is staggering and much of this is due to health insurance, healthcare, housing costs and cost of living.

Have I scared you, or made it believable that you can make this happen?