The step-by-step plan for Panama

With this step you know how you can come to live in Panama. For most pensioners that's through the pensionado visa, a right of residence for people with a pension. This visa is the reason Panama is the pension destination of the Americas.

The condition is a demonstrable lifelong pension of US$ 1,000 a month. Your AOW (the Dutch state pension) and your occupational pension count together. That gives you permanent residence from day one. You don't have to renew it every year, as in Thailand. You don't have to put money aside in a deposit, as in Indonesia. And there's no age requirement.

Two things to know right away:

• Every application runs compulsorily via a Panamanian immigration lawyer. That's laid down by law. So the lawyer's fees aren't a luxury but a fixed item in your budget.
• The internet is full of outdated information about the old Friendly Nations route (a visa for citizens of friendly countries, with the promise "directly permanent with a company of your own"). That route was abolished in 2021. This plan works with the rules of today.

With this step you know what happens to your tax, your AOW and your healthcare after the move. These are the two sums that carry the decision: your income and your healthcare.

First the tax. A thousand English-language sites promise "living tax-free in Panama", but they keep quiet about the Dutch side. Panama indeed doesn't tax foreign income. But the tax treaty gives the Netherlands the right to tax your AOW and your pension. So the wage withholding simply continues. What you gain is the contributions part (you no longer pay Dutch national insurance contributions) and legal certainty. The tax itself stays.

The accrued AOW itself does come along in full. The Netherlands and Panama have had an export treaty since 2005: an agreement that the benefit is also paid in full in Panama. So a single person too keeps the 70% rate, the higher AOW amount for single people.

Then healthcare. There's no CAK route. Through the CAK, pensioners in a treaty country stay insured via the Netherlands, but Panama isn't on that list. So you insure entirely privately. The insurers apply entry limits: above a certain age they no longer accept you. With local insurers that limit is around 65, with international ones around 74.

Read both articles before you plan any further.

With this step you find out where in Panama you want to live. The country is three countries in one:

• Panama City. A world city with the best hospitals and city prices.
• Boquete, in the highlands. The expat village at 1,200 metres. It's around twenty degrees all year, with cool nights.
• Coronado and the beaches. Warm and humid, an hour from the city.

Explore all three. Do it in the rainy season, from May to November inclusive. Whoever knows only the dry season doesn't know the country.

Also look honestly at two things:

• Safety per neighbourhood. Panama is among the safest countries of Latin America, but the differences per district are real.
• The language. Outside the expat enclaves, the places where many foreigners live, Spanish isn't an option but a condition.

With this step you know what the journey is going to cost you. The calculator above works on your own moving choices.

The big one-off item here isn't the move but the visa process. The lawyer, the fees for the application, the apostilles (an international stamp of authenticity on your documents) and the translations add up to thousands of euros per person. After that the country is affordable, certainly with the statutory pensionado discounts. Everything there runs in dollars.

That dollar is the warning at the same time. Your AOW and pension come in in euros, but you live in dollars. That exchange-rate risk stays in your budget for good. So count with a margin, not with today's rate.

With this step you know whether the whole family stands behind the plan. No forms are involved, and yet this is where most journeys fail.

Going alone? Then have this conversation with the people you're leaving behind. The questions below work for them too.

Take three evenings. One conversation is too short for a decision like this. Set aside three evenings, a week apart. Talk with your partner, and depending on their age with your children too:

• Evening 1, why. Why do we want this? What do we hope to find in Panama? What are we leaving behind here? Would that really be different there?
• Evening 2, what we give up. Who and what will we miss? What are we dreading most? What do we do if it disappoints?
• Evening 3, the conditions. What needs to be in place for each of us to say yes? When do we check together whether it's going well, for example after six and after twelve months? And what would be a reason for us to come back?

Write the conditions down. On the kitchen-table card it all fits on one A4 sheet.

With Panama the distance weighs heavily. It's well over ten hours' flying, and family comes less often than everyone promises at the farewell. On top of that comes the sum from the step about your income and your healthcare: what do you keep net after the Dutch tax and the health policy? Have that conversation with the real numbers on the table.

Divide the work. Agree who takes on which part of this plan: the papers for your residence, the house and the cancellations, the school, the move. That way not one of you carries everything. Invite your partner into your plan; then you both see what's done.

Is one of you going without an income of your own? Someone who lives in Panama and doesn't work in the Netherlands usually stops building up AOW. AOW is the Dutch state pension. For every year you're not insured, you later get 2 percent less AOW. From the moment you're no longer insured, you have one year to take out voluntary insurance with the SVB.

Also discuss whether that partner keeps an account and money of their own, and how you decide together on big expenses.

Married, registered or living together? That can matter for your partner's residence permit, for being insured together for healthcare and for inheritance. If family members come along in your application, their marriage and birth certificates go into the file, with an apostille and a sworn Spanish translation. Check at your residence permit further on in your plan what applies to you.

Are children coming? How you tell them depends on their age:

• Up to about four. Tell them shortly before the move and keep fixed routines, such as the bedtime ritual and the cuddly toy in the hand luggage.
• Primary school. Tell them well in advance and let them look along: photos of the school, the neighbourhood and the house. Let them choose something, such as their room.
• Teenagers. Involve them in the decision itself. For them, saying goodbye to friends weighs heaviest. Agree how they'll stay in touch and when they'll see their friends again.

In Panama the choice of school is above all a choice of language. Public education is free and in Spanish. The international schools are mainly in and around Panama City, charge serious school fees and have waiting lists.

Who learns the language, and when? Outside the expat enclaves, the places where many foreigners live, Spanish is not a choice but a condition. Often the partner without work needs the language most, and that's exactly the one with no colleagues to practise with. Plan it together, preferably before you leave.

With this step you close the orientation phase with a target date for departure. See that date not as a deadline but as a compass.

These clocks set the pace here:

• The healthcare acceptance. An insurer has to accept you first. Arrange that before every irreversible step.
• The visa process. That takes three to six months.
• The document logistics. Apostilles and sworn translations take time.

A realistic picture: from serious decision to being settled, this journey takes most people six to twelve months.

You fill in the date below in this card, and filling it in completes the step. You can always adjust your target date. The planning then adjusts with it.