I left the US to retire in Mexico at 50. My first year of mistakes and surprise expenses taught me what it really takes to live abroad.

• At age 50, I gave up my career in the United States and retired to Mexico. The first year abroad was challenging.

• I made the mistake of deciding to rent before testing a neighborhood and talking to locals.

• I also learned a lot about exchange rates and budgeting for unexpected costs.

When I turn 50, I want to retire from my career as a pharmacist and move abroad.

The high cost of living in the United States makes early retirement seem impossible to me, but with strong financial investments and strategic moves, it seems possible.

Mexico is my retirement destination of choice because it is generally more affordable than the United States and is close to San Francisco, where my family lives.

From there, I settled in Ajijic, Jalisco, a popular Magic Town (considered a “magic town” of cultural, architectural or historical significance in the country) on the shores of Lake Chapala, known for its pleasant climate and vibrant culture.

Sorting, selling, and donating my belongings was exhausting, but getting a visa appointment at the Mexican Consulate in San Francisco was even more difficult.

After weeks of calling the appointment hotline with no results, I hired an immigration coordinator who told me the earliest appointment was at the consulate in Laredo, Texas.

After booking a few flights, dealing with cancellations, and driving through the night, I headed south as promised and got my visa in late 2022.

Perhaps not surprisingly, this was the first of many obstacles I encountered as a new immigrant overseas.

From the beginning, I made several mistakes when securing my home

When I arrived in Ajijic, Jalisco, it was peak rental season, when northern “snowbirds” migrate south during the colder months. Therefore, the rental market is particularly competitive.

Before moving, I had imagined living in a traditional Mexican-style house with high vaulted ceilings and an interior courtyard filled with greenery. Although I check the websites of real estate companies every day, they are far from what I think.

When I finally saw a beautiful house on Facebook, I immediately called the real estate agent and planned a tour. Looks even more beautiful in person.

Fearful of missing out on this opportunity to live my dream retirement, I agreed to pay a full year’s rent and a security deposit upfront. Soon, I realized several downsides to living there.

The neighborhood where the house is located often hosts rowdy block parties that last well into the night. After sleepless nights, security scares, and a gas leak in the house, I had had enough. I violated my lease and only received a partial refund of my prepaid rent.

This costly lesson made me realize that I should first check into a nearby hotel or Airbnb to test out the neighborhood and become familiar with the area before signing a lease. I would let my beautiful ideals take me away, and prepaid rent gave me no leverage if things went wrong.

A few months later I started thinking about buying a property because I wanted to have more control over my living situation. Additionally, Ajijic has long been a popular destination for expat retirees, so it seemed like a good investment.

By that time, I had learned more about the area and purchased a house in a quiet neighborhood that suited my needs.

Currency fluctuations and unexpected expenses put my budget to the test

Before I moved, I calculated a monthly budget that would allow my early retirement to last for a few years.

However, I hadn’t considered how much of an impact exchange rates can have on your budget.

When I first arrived in January 2023, the exchange rate was about 19 pesos to 1 dollar. By mid-July, it had fallen below 17. While my spending in pesos has stayed the same, my cost of living in dollars has gone up.

Currency fluctuations have amplified my expenses and put me over my budget. My confidence was shaken in the first few months as I saw my plans falter.

Initially, I used my Charles Schwab debit card to withdraw money from the ATM because the card reimburses ATM fees. Still, the exchange rate remains poor, with Mexican Bank rates even worse.

A few months later, I learned about Wise, a service that offers low-cost international money transfers at mid-market prices. I set alerts to move funds when interest rates reach a certain level, giving me more control over my cash flow.

Unexpected expenses also threw a wrench into my detailed financial plans. For example, in the first six months, I went back home to San Francisco twice for family emergencies.

While in Mexico, I wanted to reduce transportation costs by using the local bus system. However, the stations are not always clearly marked and I am still learning my way around. In the early days, I often took pricier taxis to nearby towns due to the language barrier and unfamiliarity with the area.

I also discovered the “gringo tax.” As an Asian woman speaking broken Spanish, I was quickly recognized as a foreigner.

Since I don’t yet know the going prices for products and services in town, I often overpay. For example, every time I shop at a supplier’s store, he charges me a different price. Another time, I bought honey from a market vendor for 150 pesos and later heard that he was charging a local customer 120 pesos for the same product.

Now that I’ve been here three years, I have a better idea of ​​how much things should cost, and my Spanish isn’t as rusty anymore. However, these small expenses do add up in the first few months.

A challenging first year abroad helped me develop a clearer strategy moving forward

My first year as an expat was a disorienting experience filled with rookie mistakes and unexpected expenses, which taught me to research carefully and be flexible.

Through conversations with foreigners and locals, I gradually discovered the stores with the best prices and reputable service providers, and gained a deeper understanding of the local culture.

Looking back, I think of “first year” as my training ground, when I spent more, slept less, and learned fast. Once I found my direction, I developed a sustainable retirement strategy.

Now, three years later, I wake up to the sound of birdsong, ready to face the day with clear expectations and a solid financial foundation.

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