Retirees head to Latin America, where middle-class money can buy upper-class lifestyle

CUENCA, Ecuador - With its cobbled streets, soaring cathedrals, and bustling markets, this colonial town exudes a lazy, Old World charm.

But Cuenca is also on the cutting edge of a very modern trend: providing a safe haven for U.S. retirees who have found themselves unwilling - or unable - to live out their golden years at home.

The growing wave of expat seniors is not only upending notions about retirement, but also reshaping the face of communities throughout the Americas. And the trend is expected to grow as waves of baby boomers exit the workforce ill-prepared for retirement.

There's no accurate way to measure the phenomenon, but the Social Security Administration was sending payments to 380,000 retired U.S. workers living abroad in 2014 - up 50 percent from a decade ago.

In the Americas, records show that seniors are flocking to Canada, Mexico, Colombia, the Dominican Republic, and Ecuador.

Ecuador is home to 2,850 retirees receiving benefits, according to the U.S. government. But that number doesn't tell the full picture. Cuenca recently conducted a census that found almost 10,000 foreign retirees there, most of them from Texas and Florida.

On a recent weekday, Susan and Michael Herron were having breakfast. Both in their 70s, they have the lean look of people whose principal mode of transportation is walking.

They said they'd previously "retired" in Florida, Georgia, Alaska, South Carolina, and Panama before settling on Ecuador because it was beautiful and cheap.

"We could have survived [financially] in the United States if we had moved to a more rural area," said Susan Herron, 71, a semiretired property manager. "But we wanted to take this chance while we were still healthy enough to be able to do it."

In Cuenca, with about 350,000 people, they've found robust public transportation, an extensive museum network, solid health care, and markets bursting with fresh fruits and produce. Their two-bedroom, 21/2-bath apartment costs less than $400 a month. For about $1,500 a month, the Herrons have found, they can live a solidly upper-class lifestyle, dining out frequently and traveling.

"In the United States, we couldn't afford to go anywhere," Susan Herron said. "We were having to stay home."

Many Latin American countries are trying to woo U.S. retirees - and their pensions. Mexico, Panama, Nicaragua, and Costa Rica, among others, try to make it as easy as possible for seniors to set up shop.

But city officials say Cuenca is something of an accidental hotspot.

"Cuenca never wanted to attract retirees," said Ana Paulina Crespo, director of international relations for the city. "In fact, we're facing lots of problems over how to deal with a phenomenon that we aren't responsible for creating."

Cuenca is trying to combat local fears that the retirees are both driving up land prices and bleeding the public health-care system, she said. And the language barrier has become a source of local irritation.

"Cuencanos are feeling like strangers in their own city," she said.

Starting in about 2009, Cuenca became a viral sensation on retirement websites. International Living, an influential publication, ranked it the top expat retirement site several years running.

"The internet has changed everything," said Dan Prescher, a senior editor at International Living who recently moved from Ecuador to Mexico to be closer to his family in the United States. "Now, you can talk to expats who are living the life in real time. It has lowered the research bar."

There are drawbacks to life abroad, of course. Some seniors said they felt isolated by language and cultural barriers, and believed that they had to be on guard from being fleeced by local merchants.

But if there is a real driving force for retirees, it's health care. Though the Trump administration has said it will leave Medicare untouched, its desire to scrap the Affordable Care Act amid rising premiums has created anxiety, Prescher said.

"Look at what retirees [in the U.S.] are facing," he said. "They have a fixed income, maybe their investments haven't been doing that well, and now nobody knows what public health care will look like in the United States.

"In the face of that . . . if you can live in a place where you can cut your cost of living in half while getting access to high-quality health care, you have to think seriously about it," he added.

James Skalski, a 74-year-old semiretired architect and builder from Minneapolis, credits Cuenca's medical establishment for turning his life around. When he arrived three years ago, he was 20 pounds overweight, and had high blood pressure and a family history of heart disease.

"In the United States, all they would do for you is give you drugs," he said. Here, a holistic doctor worked with him for six months, using a regimen of nutrition, chelation therapy, and meditation Skalski said has reversed all that. Price tag: $1,600.

"Just last month, I had to go to the dentist for inflamed gums, and the dentist was using state-of-the-art X-ray equipment made in Germany," he said. The X-ray, antibiotics, and dentist visit ran less than $30.

Cuenca's survey of retirees found that most were paying for health care out-of-pocket or had private health care. But foreigners need to pay into Ecuador's public-health system for only three months before they have access to full benefits.

When Michael, a 76-year-old retired IT worker-turned-novelist, recently ended up in the emergency room for a cardiac issue, the total bill was $133. In the past, the procedure in the United States was billed to his insurance company at $186,000.