Social Security and Retiring Abroad: 7 Things You Need To Know

Retiring abroad might be the dream you've been looking forward to. You may be looking for adventure or a cheaper place to live.

But as your retirement nears or you decide to retire early, it's important to nail down the details for your upcoming relocation and your Social Security benefits.

In general, U.S. citizens won't encounter too many issues. But there are still some hoops to jump through, especially if you aren't a U.S. citizen. We explore the key details to help you navigate your transition into retirement.

As a U.S. citizen, it's relatively painless to collect your Social Security benefits while living overseas. If you meet the requirements for a Social Security payment, the funds can usually be sent to you wherever you are living.

If you aren't sure if you qualify to have your Social Security payments sent abroad, use the Social Security Administration's free tool to see if your new country has an agreement with the U.S.

However, since over 500 million people live outside of the United States and collect some level of Social Security, it's not uncommon to qualify for payments even if you are a non-citizen retiring abroad.

If you aren't a U.S. citizen, you'll face a different set of rules surrounding your eligibility for Social Security benefits. Generally, Social Security payments to non-citizens will stop around six months after you leave the United States. But in some cases, you might qualify for an exception to this rule.

If you plan to retire to Cuba or North Korea, you won't be eligible to receive your Social Security benefits. For U.S. citizens, the funds are withheld until you move somewhere else. When you move to an approved country, the withheld Social Security payments will be sent to you.

If you aren't a U.S. citizen, your Social Security funds will be withheld throughout your entire stay in an off-limits country. After moving to an approved country, your payments can resume. But you won't have access to the funds withheld during your stay in Cuba or North Korea.

As you might expect, there is some paperwork to complete if you want to receive your Social Security benefits abroad.

If you are not a U.S. citizen and plan to leave the U.S. for at least 30 consecutive days, you must file Form SSA-21.

If you are a U.S. citizen who has already applied for Social Security, you might just need to update your direct deposit information. Many countries allow direct deposits from the Social Security Administration. You can check the full list to see if direct deposit payments are an option for you.

The United States has ongoing agreements with around 30 countries to streamline your Social Security collection process. 

These countries include Italy, Germany, Switzerland, Belgium, Norway, Canada, the United Kingdom, Sweden, Spain, France, Portugal, Netherlands, Austria, Finland, Ireland, Luxembourg, Greece, South Korea, Chile, Australia, New Zealand, Japan, Denmark, Czech Republic, Poland, Slovak Republic, Hungary, Brazil, Uruguay, Slovenia, and Iceland.

After you start receiving Social Security benefits abroad, the Social Security Administration will send you a questionnaire every one to two years. You'll need to complete this form to confirm you are still eligible for your benefits.

The questionnaire asks about your working status abroad, deaths, divorces, changes of circumstances, and more. If you don't respond, you might stop receiving your payments.

Supplemental Security Income is designed to provide financial support to elderly or disabled persons with limited income and resources. You cannot collect this payment if you are living abroad.

Retiring abroad could be the perfect way to see the world. In addition to tapping into senior travel discounts, setting up your home base in a new part of the world can help you achieve your retirement lifestyle goals.

As you map out your retirement plans, take a closer look at your Social Security situation. Find out how much you can expect to receive and confirm you are eligible to receive those benefits in the country of your choice.