International Community Foundation Survey
by Richard Kiy and Anne McEnany
In order to better understand some of the key trends and drivers for U.S. retirees in Mexico’s coastal areas, the International Community Foundation conducted an online survey between June-November 2009, resulting in over 1,000 total responses. The Foundation targeted U.S. retirees over 50 years of age that are residing part-time or full-time in Mexican coastal communities. These communities included Puerto Vallarta, the Riviera Maya, Cabo San Lucas, Rosarito, La Paz, Loreto, Puerto Peñasco, and many smaller villages along Mexico’s extensive coastline. After filtering out non-target respondents, the Foundation had over 840 survey participants, resulting in a high degree of confidence with results that reflect this targeted group.
Almost 53% of survey respondents are under 65 years of age, making them part of the “baby boomer” age group. 67% of all respondents have at least a college degree, and, in fact, 31% of respondents have masters’ or doctoral level degrees. 73% of all respondents are fully retired; while 46% of the “baby boomer” group is fully retired.
61% of respondents are married, compared to the U.S. national average of approximately 65% for a similar age group. Among those residing in Mexico, a higher percentage (15.2%) are divorced, compared to approximately 10% for the same age group residing in the United States. Less than 8% of survey respondents are widowers, compared to 15% of those residing in the United States. Finally, approximately 30% of survey respondents are “solo” – including those never married, or previously divorced, separated, or widowed.
Respondents are also financially comfortable by Mexican standards. Almost 70% have an annual income over $25,000, giving them over $2,000/month allowance. This is higher than the $11,410 average per capita annual income of a Mexican citizen or the U.S. Department of State country estimate of $14,200. Even so, our respondents signalled that although they spend less in Mexico (nearly 70% spent less than $2,000/month on household expenses), a majority feel their quality of life is actually higher than in the U.S. Nearly 75% stated that the cost of living was a major factor in their decision to retire to Mexico.
Survey respondents reside in Mexico, but are also active international travellers. Approximately 47% identified Mexico as their full-time country of residence. In fact, 71% stated that they live more than half the year in Mexico. 78% of respondents have lived in their adopted community three years or longer; 52% have lived there over five years. Nearly 80% still visit the U.S. at least once per year. Yet, most respondents enjoy travelling, and consider their favorite destinations to include the U.S. (55%), Europe (34%), Canada (12%), and Central America (12.5%).
Why do retirees stay in Mexico?
Survey respondents enjoy the cultural and social interaction and want to learn more about their adopted communities. Although the overwhelming majority of respondents are Caucasian, over 48% consider themselves to be either fluent or intermediate Spanish speakers; only 7% commented that they spoke no Spanish. 46% get their news from Mexican news sources in Spanish or English. Despite the perception that there is not a language barrier for many retirees in their adopted communities, it is also important to recognize that Mexican tourist destinations often have many fluent English speakers in the service sector, and therefore, speaking Spanish may not be essential for a retiree’s daily life.
88% of our respondents feel that they are either somewhat integrated or very integrated into their adopted Mexican community. And 91% said that they found it easy to adapt to their new life in Mexico. In fact, a full 29% only return to the U.S. once a year or even less frequently, while another 20% go back just twice a year.
In focus groups, U.S. retirees commented that their Mexican neighbours, slow pace, and interesting culture were all reasons they enjoy their “adopted” community. Yet, U.S. retirees admitted to a “respectful distance” from their Mexican acquaintances. The Mexican social fabric and civil society are still evolving; and it was felt there are not many opportunities to publicly interact, except in church, philanthropic clubs (i.e. Rotary), or during cultural festivals. Yet, because most of these retirement destinations are also tourist destinations, there are many immigrants (from other parts of Mexico and elsewhere) that are more open to establishing new relationships with U.S. retirees.
Because of the interest of the U.S. retirees in establishing a sense of community in their “adopted” home, they create their own social networks that grow in size and strength over time. Church masses in English, Bingo games (instead of the Mexican Lotería), and English speaking gathering places like restaurants and cafes have gained popularity in more established retirement communities such as Mazatlán and Puerto Vallarta. English speaking newspapers, magazines, listservs, and websites are also common throughout Mexico’s coastal communities. These comfortable and culturally familiar interactions make it difficult for retirees to later reach out to their Mexican neighbours, further restricting the potential for social integration.
The respondents that chose Mexico’s coastline did so for its quality of life and they plan to stay. They selected their retirement destination because of lifestyle (79%), cost of living (75%), weather (69%), and proximity to the U.S. (63%). 31% stated that they already owned property in Mexico when they decided to retire there, but 77% own their home now.
They also prefer coastal living and enjoy recreational activities that center on the water. Nearly 56% take pleasure in coastal leisure activities such as fishing, swimming, surfing and boating. Just walking along the beach was mentioned by 70% of respondents; and relaxation was a major “activity” mentioned by 65% of respondents. Notably, only 14% mentioned golf as a desired pastime.
Of course, these are typical recreational activities for any tourist destination, but Mexican communities offer U.S. retirees much more. Cultural and educational attractions such as festivals, painting/music classes, opera, and gallery openings also create opportunities for Mexicans and Americans to explore shared interests. In addition, Americans have brought other pastimes with them, including yoga, massage, reiki, and embroidery/knitting.
What would make retirees depart Mexico?
We know that retirees are still considering their options. 41% had considered retiring in the U.S. instead. Respondents also cited several factors that would prompt them to consider leaving Mexico – among them, escalating drug violence in their local community (43%); declining environmental quality (45%); or a declining quality of life because of increased urban growth (30%). 39% stated that an increase in the cost of living would cause them to reconsider Mexico.
Public safety is another key factor in retirees’ decision to stay in their “adopted” coastal communities in Mexico or move on. The single-strongest factor that would cause respondents to consider leaving Mexico was a noticeable increase in crime impacting retirees or tourists (58%); 46% stated that safety issues were a concern they considered when deciding on Mexico as a retirement destination. 22% have noticed an increase in crime following the global economic recession, and 66% cite narco-violence as an important public policy issue to retirees in Mexico. For those who were purchasing a home, 78% stated that safety was an important consideration in their decision.
Despite this, only 39% own property in a gated community, and U.S. retirees insist that Mexico is safe. When the H1N1 virus outbreak occurred in Mexico, only 2% of respondents stated that they changed their frequency or duration of trips to Mexico. Despite their concerns, only 7% reported that narco-violence and security concerns have reduced the frequency or duration of their trips to Mexico. Furthermore, 60% have not changed their attitude in any way about their personal safety since they have been living in Mexico.
Economic security is a factor as well. Almost 44% of Americans residing in Mexican coastal communities were able to live comfortably on less than $1,000 a month for household expenses; 15% indicated that they live on less than $500 a month. This is significantly different from the U.S. where in California, a senior might need $21,000-27,000/year, and in New Jersey, a senior could need up to $43,000/year just for food, shelter, transportation and health care. Low property taxes are also an attraction in Mexico; most focus group participants reported paying a fraction of what they paid in the U.S., but recognized that with additional taxes, infrastructure and services would likely improve.
Finally, while the global economic crisis is still evolving, U.S. retirees already in Mexico have weathered the storm well. 42% stated that the economic recession had no impact on their retirement plans and 34% said their quality of life has not been impacted by the economic crisis. 27% reported that they will spend the same amount of time in Mexico as in previous years, but 36% noted that they expected fewer visits from friends and family. Anecdotally, retirees also worried that they might not have as much to contribute to charitable organizations this year.