Americans Find More Affordable Paradise for Retirement

May 15, 2013— -- Nestled in the Andes Mountains is a kind of paradise that has lured thousands of Americans away from home.

Cuenca, Ecuador, may be a place many people have never heard of. But it's become a city teaming with retirees from all over the United States, drawn there by quality health care, a booming social scene and a low cost of living that makes their nest eggs suddenly seem golden.

Jan and Paul Cottage moved to Cuenca from Houston, Texas about a year ago. But it was not a future they were counting on when they began discussing retirement several years ago.

"I think we are the least likely people to end up in Ecuador," Jan Cottage said. "We owned a time share in New Mexico. That's where I thought we would always retire."

But when Jan Cottage, 61, lost her job and the company Paul Cottage, 67, owned was downsized, they realized they were looking at an early retirement with less money than they had planned on. So he got on the computer and started researching.

"So when he comes home and says, 'What do you think about Ecuador?' I just burst into tears," Jan Cottage said, smiling now at the memory. "You could see him go, 'Oh, this is not good.' And so he kind of went away and didn't mention it again for several months."

She said she could have looked for a new job, but knew at her age the chance of finding something at her same salary was slim.

"It's real hard when you're in your mid-50s to find another job. You're competing with very well-qualified people that may be 30, 35 years old," she said.

Despite her initial hesitation, the couple kept researching the possibility of retiring overseas, knowing that if they stayed in the United States, even moving to a less expensive city, they would be strapped by high health care costs, property taxes and other fixed costs like utilities and gas.

"We all know people who have retired and they spend a great majority of their time watching television," Jan Cottage said. "We wanted to make sure that wasn't us."

They went to Costa Rica on vacation but decided it wasn't a place they wanted to live. They also visited Panama and Mexico.

Then they flew to Ecuador and found it had just what they were looking for: a moderate climate where temperatures didn't typically climb out of the 70s, an active art and music scene, and plenty of places to hike and exercise.

They went back for a second trip, this one for five weeks, where they tested what it would be like to live in Cuenca. They took Spanish lessons and learned to navigate the cobblestone streets. Then they moved there for good.

The Cottages, who don't have any children, said they don't miss much about their life in the U.S. aside from their friends. Their property taxes were slashed from about $10,000 per year in Houston to just $72 per year in Cuenca.

Jan Cottage's health insurance dropped from $640 per month in COBRA payments in the U.S. to just $100 a month for private insurance in Ecuador.

Even a year later, they marveled as they moved around their kitchen pointing out fruits, vegetables and a loaf of bread they bought for just a dollar, even less in some cases.

There have been some hiccups. While Cuenca offers most of the amenities they were used too -- such as widespread Internet service and DirectTV -- there is a more relaxed vibe that took some getting used to.