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Relocating to Panama: 6 Reasons to Consider the Crossroads of the Americas

At some point, most of us have daydreamed about picking up and relocating to a tropical paradise. In recent decades, many North Americans and Europeans have actually done it, and have made locations in Costa Rica and Mexico popular areas to consider for retirement, a vacation home, or simply an adventurous mid-life move.

One such destination is Panama. This small country on the Central American isthmus boasts a welcoming culture, striking natural beauty that ranges from 12,000-foot mountains to picture-perfect tropical beaches, and government policies that encourage people to move here. There are many reasons to consider relocating to Panama, and first among them is…

#1: A Long Tradition of Welcoming Foreigners

Given its location, at the narrow bottleneck of land that connects Central and South America, Panama was a natural meeting point of transportation routes and cultures long before any Europeans arrived on the scene. That only intensified as time went on, as the Panama Canal was built, and as the nation pushed back from economic decline and political unrest to create one of the region's strongest economies. It's the nature of the country, and of its warm and friendly people, to create communities that welcome many cultures and ethnicities. Spanish is the language here, but in many areas, most of the locals speak at least some English.

#2: Latin American Affordability

Although prices are no longer at the rock-bottom levels of decades ago, or that they are at today in countries such as Nicaragua, Panama is still an affordable place to live. An annual income of about $20,000, which would leave an individual barely scraping by in the U.S., generally provides a comfortable lifestyle here.

#3: Thoroughly Modern Amenities

Many visitors are surprised when they get their first view of the Panama City skyline with its steel and glass towers – it's not what they expect when visiting Latin America! It gives the impression of a cosmopolitan city that's technologically up to speed. And that impression is accurate. Panama is one of the Latin American countries where you don't have to worry about the tap water, and where roads and communications infrastructure are generally up to U.S. standards. Health care is great in Panama, with the same technology and accessibility as in the states, only at a significantly lower cost.

#4: Huge Variety in a Small Land Area

For a country of only 30,000 square miles, the natural variety and diversity of Panama is breathtaking. Landscapes range from temperate high-altitude rainforest to sultry tropical beaches. Water-lovers have a choice of two coasts, Atlantic or Caribbean, and they can also explore the fringes of the Panama Canal, where much of the native forest has been preserved. Hiking, adventure, eco-tourism, and wildlife watching opportunities are similar to those found in neighboring Costa Rica. Those looking for more civilized outdoor pursuits will find that Panama has excellent golf and fishing, as well as being a wonderland for gardeners. Local produce is affordable and easy to come by, and Panama is also well-known for its coffee.

#5: Real Estate Deals

Like costs of living in general, Panama properties are no longer mere fractions of U.S. prices – but they are still quite affordable. An expatriate can buy a house in the beautiful mountain region of Boquete, surrounded by flowering rainforest and minutes' drive from a world-class golf course, for the price of a similar home in a Midwestern U.S. suburb. Other options for buying property in Panama include buying land and having a house built. The processes for buying property in Panama are relatively straightforward.

#6: Incentives for Retirees

If you are considering retirement, perhaps you have heard of some Latin American countries that offer tax breaks or other financial incentives for people who retire there. Well, Panama's incentive program is the one that all of the others were modeled on. There is actually no age requirement to become a pensionado, but one must prove a regular pension of at least $500 per month. This means that some pensionados are nowhere near "senior" age, but have served in the military or taken early retirement. Some basic documentation and a passport is required, as are a health certificate and background check.

Those who receive Panama pensionado status are entitled to half-price admission to sports events, movie theaters, concerts, and plays. Public transportation comes at a 30% discount, and a 25% discount is offered for airfare on Panama's COPA airlines. There are significant discounts on hotels and restaurants, and 10%-20% discounts on health care, dental services, and medication. Given these incentives, it's no wonder that retirees and expatriates are buying property in Panama.