Retiring in Sri Lanka?

Last year I made a trip to Sri Lanka.  Edward has asked me a couple of times if I would write a rough and ready evaluation of whether I would consider retiring there.  So, just off the top of my head, here is a quick response.

I might consider it, but I would need to do a lot more research, and I think at the moment for me the answer would be , “no”.  I liked travelling there, and kept on meeting people and families (often from the UK) who were having their third holiday there.  But I am not sure about living there.

I don’t know the visa situation, nor the cost of rental, or the possibility of property purchase.  Hotels were relatively expensive.  Having only been through Columbo I don’t know the availability of any goods that I might want to buy if I was staying. This is also a problem in Malaysia – if it’s not a mobile phone or its accessories  you want then it may not be so easy to find.  I also don’t know if importing one’s household goods would be easy and tax-free.

Being an island I find Sri Lanka a bit isolated.  I don’t know how many flights out there are, their availability and costs.  I think there is now a ferry to India, too.

I don’t know how good Internet access availability is in general, but mobile Internet was cheap and speeds reasonable.

Domestic transport was cheap, but crowded, although the country roads seemed quite empty and the standard of driving reasonable. I haven’t checked the statistics on that, though.  I’d have to check car prices.  Tourist sites can be expensive to enter.

And it was quite annoying that it was too risky to use a credit card as reportedly so many people will copy the numbers and use them.  So I never used a credit card there. And I only used an ATM there twice – the second time the bank stopped my ATM card as the ATM machine I’d used (in the middle of Kandy) had been used in the past for fraud.  I had a backup card with another bank, but this could have caused a terrible problem when I was doing everything right, correctly, carefully and honestly.

What about the future of the economy and the stability of the currency?  I don’t know.

Alcohol prices and availability are not so good, which may or may not be an issue.  And I don’t know about health facilities, either, but apparently malaria is not a problem now.

Certainly it was easy just to communicate in English,  the food was good and inexpensive, and the scenery and variety of scenery wonderful.  It seemed safe enough, although there is sometimes political violence.  If you don’t attend demonstrations you would likely have no problems.

So, after doing my research on these and other matters I still imagine probably would not want to retire there under current conditions.

A trip to evaluate retirement in subtropical Queensland

In April / May 2014 we made a trip to south-east Queensland in order to decide whether this area of Australia might be a good area in which to live in retirement. Fortuitously we knew several people living in the area, so we could get several different opinions. One person had been living retired in Penang, another was our neighbour in London in the past, and other friends had relocated from other parts of Australia and abroad.

We had a great time, partly because we could enjoy being with friends. We spent some time staying overlooking Brisbane River near the city centre and enjoying perfect BBQ weather, then on a farm in the Sunshine coast hinterland, later on a vineyard inland near the Queensland-NSW border, and finally staying in a campervan in a campground right next to the beach.  The water was refreshing but not cold, and the sun was hot. One day I even took part in a sports car rally in the Gold Coast hinterland.

car rally

car rally

I was concerned about a couple of things before going.

One is that in most parts of Australia the public water supply is poisoned with added fluoride.  will be.  Harvard University recently examined about 40 studies of fluoridation and about 35 studies showed that it decreased IQ by about 5 points. Of course, they are many other symptoms, too, such as fluoride blocking the body’s uptake of minerals from food. I wrote to Tourism Australia:

I will be soon making a trip to Australia. As far as I can gather, most water in Australia is fluoridated. Most of the rest of the world regards fluoride as a poison, as does the UN, and it is forbidden. How can I avoid washing in fluoridated water and drinking it, or ingesting any products with it? I will be in the Gold Coast and Sunshine Coast area.

Response? None.

The other was that Australia is the only country in the world that forces people who they select at airports to be irradiated by full body scanners.  In 2012 people who refused  were threatened with arrest, imprisonment and a criminal record.  It seems that now people who refuse are blocked from flying for 24 hours. Still, a very expensive matter for most people.  The airport enforcers of body scanners in the US are dying young from cancer, if that is any consolation. With only a couple of years use in Australia that trend has probably not yet become obvious.

We avoided fluoride as much as possible by staying on farms which had their own water supply.  And at Brisbane Airport few people were picked out to be irradiated.

What did we notice in Australia? First what was not good.

Most noticeable is how expensive it is.  Finding a cup of coffee for less than $4 was pretty well impossible where we went.  Eating out was too expensive in most cases – even a sandwich was $9. A 20 minute bus ride in Brisbane cost $6.10. We heard the cost of utilities was very high.  And what wasn’t expensive? Cars are reasonably priced, wine can be cheaper than Asia, and our rental campervan was only $21.00 per day.  That’s cheaper than both of us riding the bus into Brisbane and back! And real estate?  Prices are very high.

The government seems very authoritarian, with signs everywhere telling you either what you must do, or must not do, and how much money they will take from you if you do not obey.  Having said which, we really didn’t see any police, who are the enforcement arm of the rulers.

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People told us violent crime is high – especially in the Gold Coast.  For this reason we didn’t even go there, although we had planned to.

Finally, there was a backdrop for the trip of government budgets.  With signboards and the media this topic was in the forefront. The Federal Government was about to reveal its budget for the coming year.  And in Queensland the government was warning the people it had – meaning the people had – to deal with a massive debt, and wanted to hear from the people. “The choices are clear, we can massively increase fees, taxes and charges like car registration or stamp duty on the family home, we can reduce much-needed services or we can investigate the lease or sale of some government businesses.”  If you had another other ideas the government wasn’t interested.  So, after a massive mining boom, which fueled inflation but not pay for most, almost everyone is far worse off.  If Norway was in charge there’d be a huge sovereign wealth fund for the people, and all social payments would be funded for the next few decades.

There were plenty of good things:

Driving was far safer and easier than Asia.

You can buy anything you want or need, warranties are upheld, and you have consumer protection if there are any problems. In shops, sales staff are knowledgeable and helpful and friendly.

There is a big range of food, too, and it is fresh.  Plus there are a lot of markets around.

The sea water was  clear and the beaches clean. If fact, there was almost no litter around. Of course, you can swim in the sea.

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Nature is easily accessible, and thus there are a lot of free activities.

We were surprised that there were not as many mosquitos and flies as we thought – in fact, mostly none.

Being sub-tropical, the weather was easier to live with than the tropical weather we normally have.

We heard that now enough solar electricity can be generated by rooftop collectors to power on’s house, and with a solar rooftop water heater you can be off-grid if you want.  In fact, if you are in the country and disconnected from the water and sewerage you can save $4,000 per year! Plus, of course, you avoid fluoride.  And your electricity and hot water are free, once you have bought the solar generators / collectors.  I do not know how long it takes to repay the capital cost from your savings.

One way you can live cheaper in Australia is to live in a campervan.  Where we asked you could no longer buy permanent sites in a camping ground, but possibly a long-term rate is $30 per night.  If you stayed long-term in camping grounds, gradually moving around the country when you tire of one place, then you could keep costs down.  Your housework is minimal, too. There seem to be plenty of people who do this, at least part of the time.

We concluded that it is just too expensive to live there at the moment, and difficult to avoid fluoride.  Even travelling outside of Australia is a potential hazard due to their use of scanners.

Things change – people in Australia are fighting fluoride now, exchange rates vary, and in the future we may find it easier there. I hope so. gives another view.

Ant the antidote to fluoride? Tumeric, according to this article –

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Cost of living in Penang in March 2014

Just to give you an idea of what it could cost to live in Penang on a monthly basis, where in March 2014  GBP£1 = RM5.4; USD$1 = RM3.2; AUD$1 = RM2.9

I wrote the same blog in November 2012, so prices (and sometimes quantities) from 16 months ago are in brackets to show the rise in prices.

Here is a site I recently found that is more comprehensive than my blog: 

When first here we lived for RM30 per day, plus rent.  Below gives more details of costs of a comfortable life.

RM300 in a low-cost condo, with no facilities, and probably in a poor location in a badly maintained building.
RM2,500 for a three bedroom two bathroom condo of about 1,000 square feet, with pool, gym, parking space etc.  in a nice, reasonably maintained building.
And up for bigger, better appointed condos.
Houses, RM2,000 or more.

I think these prices have increased a bitsince I wrote them 16 months ago, but feel presently that the market is in a government induced slump.

Home ownership:
Condo: maintenance fees.
House: see tax section.

Electricity is metered, but water is a fixed charge, and you get gas delivered in canisters.

Electricity charges were recently substantially raised. We don’t yet know how much more this is actually costing us. The government charges comparatively more per kilowatt for more consumption, so the higher bands have increased substantially. I suspect at least a 20% higher bill.  It was about RM200 for electricity, using air cons when necessary, heating water for showers, lighting, TV etc. Expats report bills ranging for less than RM100 up to RM800, depending on their homes, and usage, of course. Our bill is very similar to that of the UK, but in the UK we lived in a two bedroom flat, with gas central heating, but, importantly, we were out of the flat working five days a week, which would have kept the bill much lower. Thus, electricity is costing us less here, even though it cannot be said to be cheap.

(UPDATE:  During very hot February we used the aircons more.  Our usage was 12% (kilowatt hours) more than the bill for December, but our bill was 27% more.

RM10 per month for gas. There is no town gas, so you have gas delivered in canisters, costing RM30  (RM27) or so for medium size canister. This has lasted us from about three months to about six months, depending on how much we ate in.

RM3  for water; it costs RM6 minimum per two months, and usually we only use the minimum. I use rainwater to water the plants where possible, because the plants seem to prefer it, but in the drier months use town water.

Currently a phone line and 4mbps ADSL Internet connection with Telekom Malaysia costs RM140 per month.  For 8mbps it costs RM160 per month.

RM1,200 per month (RM900) for groceries. There are supermarkets and markets for fruit and vegetables. But if we buy everything just from Tesco, this is an approximate figure, although prices are rising significantly.

Health Insurance:
RM560 for two of us for policies covering hospitalisation, taken out locally, but covering world-wide.  Visiting a doctor in a clinic used to cost around RM35 in this area, or in a hospital RM80 or more. Doctors’ prices were increased by 14.4% this week, with the previous price range for visiting a doctor’s clinic from RM10 – RM35, and the new range from RM30 to RM125.  This doesn’t appear to be 14.4% to me, but that’s what the newspaper reported. Here is a chart taken from The Star:

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Our insurance agent told us medical procedures are increasing in cost by 20% per annum, so at this rate very soon Malaysia will no longer be a low cost medical destination.

RM0 if you are renting. The service charge for the condo is paid by the owner, as is any tax on the property. If you own a house, there is a land tax and a charge for the local council’s services, which amount to about RM500 per annum for both for a modest property. The Malaysian government plans to introduced a GST of initially 6% in April 2015.  This is being universally cheered by the media. Since the government seems to expect people/companies to act as their tax collectors without recompense, I assume the extra costs of this tax collecting and accounting will be passed on to the consumers, thus having a bigger than 6% impact.  The government has recently substantially increased capital gains taxes on property sales.  Now the tax is 30% for properties sold within 5 years, and 5% on properties sold during or after the sixth year. (Previously 15%, then 10%, and after 5 years 0%).

RM2.10 (1.90) per litre – I live centrally, so even when I drive it is only for about 10 minutes one way, so in a month I spend less than RM100 on petrol.

Car running costs:
Car service – about RM400 for a Japanese car to perhaps RM1,000 for a Mercedes. I only need it once a year as everything is close by in Penang, so I don’t drive many miles. Road tax depends on engine size – see this calculator. Some things are really cheap – puncture repair RM8, for example – with immediate and friendly service. Car insurance, of course, depends on the car value and your no claim discount.  RM2,000 per year for a medium size car, perhaps, with full no claim discount.

RM0.40 (RM0.30)per half hour, and up, on Penang Island, for street parking by coupon (previously meter or with parking attendants). RM5 for parking all day, as a guideline. On weekdays it costs RM1 for three hours parking in Gurney Plaza, on weekends more. You can park free, too, in some supermarkets, on suburban streets, at some businesses.

I have heard that metered fares may double soon, but know no more.  If so, drivers will apparently “have to” use their meters.  It is so long since I caught a taxi I can’t update this figures from last time: RM10 for a short distance, RM15 for about 10 minutes drive, and up for longer. Taxis are supposed to be metered, but drivers usually prefer not to use meters and quote a price – which they usually won’t lower if you try to bargain.  Occasionally they will, though.  The quoted price and the metered price often work out similar, anyway, and I prefer the former. Pulau Tikus to the ferry terminal is RM15; Pulau Tikus to Queensbay Mall RM35. Pulau Tikus to airport RM55ish. Prices significantly higher between midnight and 6AM, and to the airport there is a special airport charge. Personally I think if you choose a regular taxi company, or several drivers you like, then you will find them honest and reliable, and have no problems.  But even picking taxis from the street I have found the drivers honest and mostly friendly – in Penang. As for KL, I hear the situation is different.

Public Transport:
The ferry to Butterworth is free; returning is RM1.20 as a foot passenger, RM7.70 for a car with passengers. Otherwise there are Rapid Penang buses and their site still says the minimum fare is RM1.40.  Beware of pickpockets – friends of mine have had things stolen on the bus. I would take nothing valuable, and only the money I needed, and not travel when the buses are full. There are few seats, so it’s likely you will have to stand. Neither are they reliable, and drivers often don’t speak English.  However, they are air-conditioned.

Alcohol is highly taxed, and costs more than the UK, and far more than Europe.  One 320 ml (330ml) can of Carlsberg beer in a supermarket is RM7.49 (RM6) and up; a 700ml bottle of local vodka is RM23 (good for cocktails), a 700ml bottle of imported vodka about RM120; a 750 ml bottle of vintage wine bottled in country of origin from RM35 if you look around; 750ml sparkling wine from RM70 if on special; imported liqueurs generally well over RM100. Mixers like a 325ml Schweppes ginger ale and tonic water etc. cost about RM1.80 (RM1.50). Coke is now RM1.89.

Eating out:
Can be free, at some temples, or on festival days, where shops hand out food, and bottles of water.  Generally, eating out is cheap, but drinking alcohol out is expensive.  A 660ml bottle of local beer is around RM15 at a hawker centre – but noodles might cost you RM3. Of course western food in upmarket restaurants is far more expensive, and a small glass of wine could cost RM20 or more.  Nevertheless, expensive western style restaurants are good value for food if you compare the price to London, Paris, Sydney etc. Local cooking uses far too much sugar, and MSG, so eating out frequently, especially in cheap places like hawker centres,  over a longer period is probably not healthy, unless you are very selective.

From RM8 (RM7) at Gurney Mall. Yes, very affordable, and cinemas are quite empty weekdays, during the day. Senior discount, when one is over 55,  makes it RM1 less. Wednesdays are discount days, too – RM1 less, but seniors get no additional discount on that.

Cable TV:
I am not at all interested. This is the Malaysian provider.

You can join local clubs, such at The Penang Club, The Penang Swimming Club, the Penang Sports Club etc. You need to buy a membership, and then pay monthly dues, which are about RM12,000 and then RM165 monthly for the Penang Club; about RM25,000 membership fee for the Swimming Club; monthly fee appears to be RM45 per month according to their website; and RM15,000 and RM100 monthly for the Sports Club. You can sell the membership in the future, if you wish.

So, as you can see, many prices are increasing substantially, with more to come, and this is before the introduction of a GST, which will further increase prices.

Did I forget anything important?  Let me know if I did, and I will add the details if I know them, or can find them out.

Is the MM2H visa worth considering after all the new taxes?

In the latest budget the government is apparently only allowing foreigners to buy properties in excess of RM1m, or houses in excess of RM2m.  So if you just want to rent, then it doesn’t affect you.  From memory,  Japanese and English people are the two nationalities who have taken up more MM2H visas than others.  Japanese mostly rent, so it is no problem for them. But many of us (English) prefer to buy so we can renovate the property to suit our own taste and convenience, and at these prices, many other countries’ property prices are more attractive.

In addition the Penang government wishes to impose a surcharge of 3% on foreigners’ property purchases.

Then the federal government wishes to impose draconian capital gains taxes, making it uneconomic to move, as if your property has increased in value, then so have others, but you lose a large chunk in CGT, so need extra money to cover the increase on the new property you wish to purchase. The most economic place to move is out of the country.

So, they prefer foreigners not to buy property now? Before they wanted us to buy property.

Certainly, we spent a lot of money and employed a lot of people renovating our property.   That was a big contribution to the local economy.  Had we continued to rent, then they wouldn’t have had this input.  And living here we contribute to the local economy, by patronising the local businesses.

Thus, if you already own a property and do not wish to move, or are happy to rent, then MM2H will work for you still. Otherwise… Germany, Malta, Turkey, Thailand, Panama, Ecuador, Uruguay are a few countries you could investigate where you can buy cheaper property and have a nice environment.

But the government changes requirements for the MM2H visa every three months or so, so they may decide these new impositions do not apply to MM2H holders.  We shall wait and see.

And then the awful GST is coming soon…

A little more information here.

All this is a pity, because Penang has greatly improved since we first moved here six years ago, and looks like a lot more improvements are coming.

Five years in Malaysia

Five years ago today we arrived in Malaysia to live.  It went fast.

We already had our MM2H visa from a previous visit. We brought everything we thought we needed at first on the plane, but not so much that we incurred excess luggage charges.  At first we stayed in the Gurney Hotel, and went out with estate agents viewing apartments to rent, looking for a one year contract in a condo with facilities.   The plan was that during this one year we could decide if we actually wanted to live in Penang, and travel elsewhere in Malaysia to see if somewhere else would be better. And if we decided to stay, then we could start considering where, and what kind of property to buy.

We found an apartment in Batu Ferringhi, and stayed for one year.  Then we moved down to a condo near Queensbay Mall, and lived for a little over a year there.  Having a friend in Balik Pulau we often visited there, too.  Thus we experienced living really in three areas of Penang, the stay in Gurney Hotel giving us an idea of Pulau Tikus, and we had a view on Balik Pulau, too.  Some travel in Malaysia convinced us that for our purposes Penang is the best place for us to live.  We thought that by now we could judge a suitable property for us, and we found a house in Pulau Tikus.

Once we moved into the house we talked to and got estimates from several builders, then had a small area of the house boarded up – the kitchen, and we lived there while the house was worked on.  Then we changed living quarters to upstairs so the kitchen could be worked on. This may have been uncomfortable, but as we were living there we could more easily and accurately decide how best to renovate. Then, at last, it was all done.

Since then we have been living comfortably. Meanwhile, Penang has generally been improving, with the exception of traffic worsening. It is difficult for the state government to improve public transport as the responsibility is in the hands of the federal government. Some road improvement has been completed, and several bigger projects are in the pipeline, so eventually it will be better.  Drivers’ manners seem to be improving, too. The island has become cleaner, many heritage buildings have been cleaned or renovated, bicycle paths are planned, and partly already implemented, etc. Anyway, I have written about this before.

As it is, Penang is small, and everywhere is only a few minutes drive away, so I visit the petrol station for a top up perhaps once a month. I would like to walk, and sometimes do, but the footpaths, while also improving, are still either non-existent, poor, or are parked across by inconsiderate drivers, forcing you onto the busy roads. I’d also like to cycle, but near home there are no facilities, and the roads are far too dangerous.  But another major reason for doing neither is the heat.  If out walking in the middle of the day, it is prudent to take it slowly, drink liquids, and wear a hat. I have ignored this a couple of times, and been repaid with heat exhaustion.  And you don’t exactly arrive anywhere looking spiffy.

Another point is that after a few years here, I am noticing I am feeling the effects of constant 12 months a year heat.  I really need to go somewhere cool for at least a week, perhaps longer, at least once a year. Even the Cameron Highlands or Chang Mai would probably be OK.

Living in a house, and liking to be surrounded by plants, means being annoyed by mosquitoes, despite having electronic devices to discourage them, and screens on all windows.

After the election there has seemly been a lot of unrest, but that hasn’t affected us at all.  The only precaution we took was not going out on election night – but even that caution may have been unnecessary.

I could ramble on, and have covered many things in previous blogs, but we still consider Malaysia to be a good retirement choice.