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You are here:  FPA Net  >  FPA Journal  >  Past Issues & Articles  >  2003 Issues  >  2003 February Issue - Article 10  
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North America: The New Financial Planning Frontier
by Robert Keats, CFP, MSFP, and Raoul Rodriguez-Walters

The ability to effectively address international issues will become an increasingly important aspect of financial planning practices in the United States. The need to address financial planning concerns in the North American continent will be especially important as Mexico, the United States and Canada continue to integrate their economies and societies. Approximately ten million citizens of one of these three countries live in any one of the other two. We expect this trend to continue to grow as the baby-boomer generation retires. In this paper we highlight the financial planning concerns of a Canadian family, the Canucks, who look to the United States and Mexico as possible places for retirement.

Robert Keats, CFP, MSFP, has been in the financial services industry since 1976 and is a recognized speaker and author in the field of cross-border tax and financial planning. His Canadian best seller, Border Guide, is now in its sixth edition. He holds a Registered Financial Planner and Certified Financial Planner (Canada) and Certified Financial Planner (U.S.) professional designations.

Raoul Rodriguez-Walters is a dual citizen of the United States and Mexico, and is a registered investment adviser in the United States and a stockbroker in Mexico. He writes a regular column on the financial planning aspects of living in Mexico.

We have all heard that it is a small world, and it is getting smaller. Globalization, mistakenly thought of solely as a business proposition, is bringing the world to our doorsteps. An increasing number of us are willing to leave familiarity behind in exchange for new adventures in business and lifestyles. Improvements in communications, compliments of the technological revolution, can provide us with important information with a click of a mouse. Trade liberalization promotes the exchange of ideas and people, as well as goods. Travel is less of an adventure in uncertainty than ever. Successful financial planning practices of the future will be required to address international issues, providing solutions to the unique needs of the already sizable and growing number of people who live international lives, be they foreigners living in the United States or Americans living overseas.

In his books, French author Jules Verne (1823–1905) predicted that space and time in the future (and beyond) would be compressed. Consider that a trip between New York and London, which now takes only a few hours, once took many days to accomplish. Thanks to the Internet, written communications can take place in real time. E-mail has largely replaced snail-mail. And while we may not yet be able to explore the center of the earth, as suggested by Verne, we work and play in countries that are now truly less distant and, somehow, less foreign.

Trade liberalization provides an incentive for people and capital to move across borders. The European Union (EU) and the North American Free Trade Agreement (NAFTA) are two obvious examples. In both cases, the growing interdependence of the regions’ economies, and indeed their societies, led to the realization that new paradigms had to be created in order to adequately address difficult and complex issues facing the member nations; many of these problems need to be tackled from an international perspective.

But perhaps the retirement of the baby-boomer generation is the most important trend affecting international and cross-border financial planning. We often hear about how this group has shaped the world we live in today. An increasing number of articles printed in publications such as Kiplinger’s Personal Finance,1 Money magazine,2 Modern Maturity3 and U.S. News and World Report4 highlight the fact that many of today’s retirees choose to live abroad. Jennifer Kerchmer of CNNfn writes: “More and more retirees are heading overseas permanently or temporarily for a change of scenery and exposure to a new culture.”5 This trend is likely to continue in spite of, or perhaps because of, the terrorist attacks of September 11, 2001.

Furthermore, financial planning firms will not be able to participate in the international consolidation of the financial services industry as simple observers. Shrinking profit margins at home and opportunities abroad are powerful incentives. In addition, the number of foreigners coming to the United States and Americans living abroad will fuel the demand for international services designed to meet the needs of non-citizens, expatriates and dual nationals.

Perhaps nowhere in the world is the need for cross-border financial planning more evident than in North America. Consider that the United States, Mexico and Canada are among the top 11 largest economies of the world.6 The two largest U.S. trading partners are Mexico and Canada. More Americans live in Canada and Mexico than in any other single country.7 Los Angeles, California, has the second largest population of Mexican nationals after Mexico City.8 And while it is impossible to know how many expats these three countries have in common, a good ballpark estimate is an astounding ten million people!9

The challenges of United States– Canada cross-border financial planning are in overcoming the similarities in culture and language that often lull each other’s nationals into a feeling of false security. The challenge of U.S.–Mexico and Canada–Mexico planning is precisely in overcoming the differences in language, customs and laws.

Case Study

In this paper, we will present a case study of a Canadian couple, John and Mary Canuck, who want to look at the possibilities of retirement “south of the border,” but are not sure if they prefer Mexico or the United States. They have come to us and want to know, from a financial planning perspective, the pros and cons of choosing one country over the other, or whether they should stay in Canada and just be regular visitors to these countries. We will cover the following areas: immigration, cash flow and net worth, tax planning, risk management, estate and investment planning, and a few lifestyle concerns. The cross-border plan is in summary form only and is specifically designed to raise financial planning issues created by the movement of people and assets across the American, Canadian and Mexican borders. (Note: In the case study, all money amounts are in Canadian dollars except where noted otherwise.)

Goals
  1. John plans to retire in one year at age 65.
  2. John and Mary wish to become snowbirds spending winters in the Sunbelt and summers in Canada, in their favorite cottage in the Muskoka area near Georgian Bay, north of Toronto.
  3. They would like to explore where might be the best place for them to winter in the United States near their son in Florida, or with friends in the Lake Chapala area of Mexico. They are tired of paying the high Canadian taxes and are wondering if there might be any tax advantages for them in retirement by taking up permanent residence in the United States or Mexico.
  4. John and Mary would like to travel in their retirement as long as their health holds out. They wish to spend time with their children and grandchildren in Vancouver, British Columbia, and Weston, Florida.
  5. They want to make sure Mary’s mother is well cared for in the nursing home and that they are able to return to Toronto when necessary.
Objectives
  1. Retire at age 65 with an income of between $160,000 (approximately $100,800 in U.S. dollars and 888,000 in pesos) annually, after tax, and adjusted for inflation.
  2. Achieve an eight percent rate of return above inflation while incurring some risk.
  3. Draw income of $40,000 annually from their investment portfolio to help cover living expenses.
  4. Sell their Toronto home and buy a new home wherever they choose to spend the winters.
Assumptions
  1. Long-term average annual inflation is 3.5 percent in Canada, the United States and Mexico.
  2. Florida residency in the United States, Lake Chapala in Mexico.
  3. $1 = approximately $0.63 U.S. dollars and 5.5 Mexican pesos.
  4. Their average combined annual U.S. federal income tax and Florida intangible tax rate for 2003 is projected to be 11 percent. Actual marginal federal income tax rates were used based on our income assumptions and are shown on the income statement. The actual combined marginal rate for 2003 is 27 percent.
  5. Canada and Mexico do not allow joint returns to be filed. The average combined annual Canadian federal and Ontario tax rate is 39 percent for 2003. Marginal combined annual Canadian federal and Ontario tax rate is 46 percent. Also, the average combined annual Mexican income tax rate for 2003 is projected to be 18.25 percent. Their combined marginal tax rate is 35 percent.
  6. Investment assets grow at an average of 7.25 percent (4.25 percent growth and 3 percent income) per year, before tax.
Immigration

Immigration issues can be a major obstacle in cross-border planning. A thorough knowledge of them, and the assistance of a good immigration attorney, are requirements for a cross-border planner.

In the Canucks’ case, for example, as Canadian citizens and residents, they must obtain green cards if they wish to become permanent residents of the United States. This is not an easy task. Their son has lived in the United States for ten years on a green card but has not taken up his naturalized U.S. citizenship yet. Their son must be a U.S. citizen to sponsor his parents, so he must apply now for citizenship, a process currently taking about six months. Once their son is a citizen, the green cards for John and Mary take about three years to obtain, but if applied for correctly, they can live legally in the United States while on the green card waiting list. Consequently, they could, if they desired, become U.S. residents as soon as John retires.

Compared with the United States, immigration to Mexico is a much simpler affair. Mexico has a retirement visa which the Canucks could use to obtain full-time residency in Mexico, known as a FM-3 Rentista. All FM-3 type visas must be renewed annually and they allow their holders to live in Mexico for extended periods of time.

Cash Management Planning

The major difference in this area when dealing with a cross-border planning situation is the currency exchange. The Canucks are used to thinking and dealing with Canadian dollars, while U.S. dollars and Mexican pesos are foreign to them. The best way to deal with this is to state their critical numbers in both U.S. dollars and Canadian dollars. Because investment assets in Mexico are expected to be minimal, it is not necessary to restate assets in pesos.

The Canucks’ combined assets totaled $1,900,000, or $1,197,000 U.S., with no liabilities, giving them a net worth of the same amounts. Nearly 100 percent of their assets are located in Canada and none are currently located in the United States or Mexico. Regarding the titling of their assets, John holds about $650,000, or 34 percent; Mary holds $200,000, or 11 percent; while the remaining $1,050,000, or 55 percent, is held jointly.

Furthermore, cost of living is an issue in cash management, but we have decided to put it aside in order to concentrate on the more important issues facing the Canucks.

Income Tax Planning

With almost every financial decision made, the effects of taxation must be taken into account. Tax planning is one of the most important modules in any comprehensive plan. This is doubly true in cross-border planning where the effects of being subjected to two or possibly three tax jurisdictions (if one counts states or provinces) must be taken into consideration.

Canadian versus U.S. income taxes. If the Canucks maintain their current residency in Canada, they will pay significantly higher income taxes on their world income. By becoming U.S. residents, they could realize a tax savings of approximately $65,964 in the first full year of their retirement. Some of the reasons for the tax savings, besides the lower tax rates, are that the marginal rate brackets are wider; more taxes, expenses, and interest payments are deductible; and charitable contribution limits are much more generous. In addition to federal taxes being lower, state income taxes are also less than provincial taxes. As a result, an exit from Canada in the near future could result in substantial tax savings.

Canadian versus Mexican income taxes. Tax savings are also significant if the Canucks choose to become Mexican residents. As such, the Canucks will save approximately $45,819 in the first full year of residence. The tax savings vis-a-vis Canada is mostly the result of lower marginal tax rates and the lack of state income taxes in Mexico. Charitable deductions are 100 percent deductible in the year made, and offset taxable federal income peso-for-peso. Finally, most interest payments, dividends and capital gains on Mexican accounts are not included in taxable income on their Mexican return.

Primary residence. If John and Mary are going to become U.S. or Mexican residents, they will be best served if they take advantage of the Canadian unlimited capital gains exemption on the principal residence in Toronto. To accomplish this, all they need to do is sell the property before leaving Canada. Under the Canada/U.S. Tax Treaty, they can sell the house after they take up residence in the United States and still get this unlimited gains exemption, but their tax situation would be unnecessarily complicated if they do not sell before they leave Canada. Once resident in the United States, they will be eligible for the combined $500,000 (U.S.) capital gains exemption on their primary residence.

Mexico allows residents an unlimited capital gains tax exemption on the sale of the principal residence.

Canadian exit return. To obtain substantial income tax savings, it would be advantageous if the Canucks formally established their tax home in the United States or Mexico. For the year in which they exit Canada, they must file a Canadian Exit Return and report the income and deductions that are attributable to Canada prior to departure.

Upon leaving Canada, the Canucks will be subject to deemed disposition rules on all of their assets other than their “taxable Canadian property.” Deemed disposition rules are applied in Canada when residents die, make gifts or leave the country permanently. Essentially, taxable Canadian property is property that, by its nature and its relation to Canada, is in some way attachable by the Canadian government in the event of failure to pay the tax. This means that non-Canadian real estate is deemed to be disposed of on the day of exit. Canadian taxes will be paid on any deemed gains. This income from the deemed sale will be added to the Canucks’ other prorated income in the year of departure.

Notification. Upon their exit from Canada, the Canucks must immediately notify all Canadian banks, trust companies, brokerage firms, life insurance companies and mutual fund companies with whom they have an account, in writing, that they are now nonresidents of Canada and that they are subject to the nonresident withholding tax as set by the Canada/U.S. Tax Treaty or the Canada/Mexico Tax Convention.

U.S. and Mexico filing requirements. Citizens of the United States and residents of both the United States and Mexico are taxed on their worldwide income. If the Canucks exit in 2003, they will be required to file a start-up return (Form 1040 Dual Status) in the United States and, if applicable, state income tax return by April 15, 2004. Residents of Mexico are also taxed on their worldwide income. Income taxes would be due on income generated as soon as the Canucks became Mexican residents. Typically, no personal income tax returns are required in Canada from nonresidents.

Registered retirement savings plans. The U.S. and Mexican tax authorities consider Canadian registered retirement savings plans (RRSPs, the Canadian equivalent to American individual retirement accounts, or IRAs) to be ordinary investments, without the tax-free deferral of interest or growth that CCRA (Canada Customs and Revenue Agency) recognizes. The United States, in effect, considers RRSPs as grantor trusts.

From the standpoint of the United States and Mexico, this means that Canadians can withdraw the principal from their RRSPs on a tax-paid basis and be subject only to a nonresident tax of 25 percent from Canada, instead of the much higher tax rate that otherwise would be applicable in Canada. The amount contributed, as well as any interest and dividends accrued up to the date of entry to the United States or Mexico, but not capital gains, is considered principal for tax purposes. As U.S. residents, Canadians can withdraw the full amount from their RRSPs and take advantage of the various tax-favored investments available in the United States.

However, the U.S.–Canada treaty provides for another alternative. The Canucks can file an election under the treaty to defer the income on the RRSPs until they make withdrawals.

In our example, the tax savings from the RRSPs alone can amount to nearly $212,500, depending upon the RRSP value at withdrawal. The 25 percent withholding tax paid can be carried forward and used as a foreign tax credit to offset future U.S./Mexico taxes due on their foreign passive income (certain interest, dividends, rents and capital gains) earned in 2003. Any excess credits can be carried forward for up to five years in the United States and ten years in the case of Mexico.

The main planning point around RRSPs is whether they should be left in Canada or withdrawn in their entirety or in part. At first blush, it might seem that the best option is to leave the funds in Canada and in the RRSP in order take advantage of tax deferral. But several factors must be taken into consideration before making any determination in this regard. The most important factors are
  • Currency risk
  • Possibility of probate and estate taxes in more than one jurisdiction
  • Investment restrictions in Canada
  • Mutual fund expenses
  • Breadth of available investment choices
  • Additional tax bureaucracy
We have the following specific recommendations for the Canucks’ RRSPs:
  • Before a Canadian exit date, John and Mary must step up the cost basis of all the securities inside of their RRSPs by either selling all individual securities or mutual funds in a profit position or transferring the funds to another fund in the same fund family. Those securities that are in loss positions should not be sold until after U.S. or Mexican residence is established.
  • If John and Mary decide to move from Canada, we would normally convert their RRSPs to a registered retirement income fund (RRIF), which is basically an RRSP in the withdrawal mode. Our reasoning is that the Canada/U.S. Tax Treaty will allow for a 15 percent withholding rate rather than 25 percent. According to the treaty and CCRA rules, approximately one quarter of the RRIF could be withdrawn at the 15 percent tax rate over a few months spanning two tax years.
  • Once the maximum withdrawal is done at the 15 percent withholding rate, withdraw the balance at the 25 percent rate.
  • Invest the net withdrawal of the proceeds from the RRSP/RRIF along with their investment portfolio in such a manner over the next six years to optimize the use of the foreign tax credits generated from the RRSP/ RRIF withdrawal. In Mexico the foreign tax credits can be used over 11 years.
Retirement Planning

This retirement analysis is very similar to a strictly domestic retirement plan with the major exception that the planner needs to provide the client with a comparison of how their retirement would, as in the Canucks’ case, compare Canada and the United States, and Canada and Mexico. Based on a review of the Canucks’ retirement situation, we have the following recommendations:

Retirement needs analysis. Their retirement income objective is $160,000 a year, after tax and adjusted for inflation, beginning at age 65. As can be seen from the comparisons, this goal is best achieved by taking up residence in retirement in the United States or Mexico. If the Canucks were to remain in Canada, the retirement analysis indicates they would consume all their retirement plans and investment portfolio by about age 80 without a major cut in spending. This is primarily due to the more favorable taxation of their retirement benefits in the United States. (The Mexico retirement numbers were not supplied but it should be expected that the higher income tax in Mexico, compared with the United States, would be partially or even totally offset with a lower cost of living, particularly in housing costs.)

Social Security. For U.S. Social Security purposes, John and Mary would have to earn $3,500 a year for at least ten years; they would accumulate the 40 quarters of coverage. If they are unable or unwilling to accumulate the number of quarters, they can use the “Totalization Agreement.” Under this agreement with Canada, if they have at least six quarters of coverage under the U.S. Social Security system, the Canucks would be able to receive a minimal amount of U.S. retirement benefits. Totalization agreements are separate Social Security accords between countries regarding their retirement benefits, thereby integrating and coordinating disparate coverages.

John and Mary would not qualify for Mexican Social Security payments if they did not contribute to the system before retirement.

Combined, the Canadian Pension Plan/Old Age Security (CPP/OAS) is the equivalent of U.S. Social Security. Under the current Canada/U.S. treaty, OAS/CPP payments are not taxable in Canada once they become U.S. residents, but are taxable in the United States, where a maximum of 85 percent of the benefits can be subject to income taxes. This may result in a significant improvement in the Canucks’ cash flow should they become U.S. residents because they would no longer pay Canadian tax rates on 100 percent of their CCP/OAS and they would not be subject to the 100 percent clawback tax on OAS when income is more than $57,000.

If they reside in Mexico, their CPP and OAS payments would be subject to 15 percent withholding in Canada. It is important to note that the OAS portion of the benefit may be subject to up to a 100 percent tax if worldwide income exceeds $57,000 due to the clawback rules in Canada. If worldwide income does not exceed $57,000, this benefit is generally subject to 15 percent withholding per treaty. In addition, this benefit is fully taxable in Mexico, with offsetting foreign tax credits.

Mexico and Canada have not entered into a totalization agreement.

Government and private pensions. U.S. residents receiving Canadian pensions are subject to 15 percent Canadian withholding. Generally, the pension will not be fully taxable in the United States to the extent that payments are recovery of capital.

Per the Canada-Mexico Tax Convention, Canadian pension payments are subject to 15 percent withholding. The cost basis of the pension is equal to its fair market value. Payments will be taxed under tax recovery rules in Mexico.

Risk Management

Health care. One of the top concerns when people retire to another country is access to health care. Canada provides its residents with a national health care plan. But that benefit is lost to them if they are outside of the country for more than six consecutive months.

One way to address this issue in the United States is to purchase insurance (assuming insurability). A second alternative is to consider the possibility of earning eligibility for Medicare through self-employment income. Finally, lawfully admitted aliens over 65 who have resided in the United States for five consecutive years are allowed to purchase Part A and Part B Medicare coverage by paying premiums.

If residing in Mexico, they also can purchase private insurance. Depending on circumstances, they may want to consider purchasing coverage through the national health care system.

Fortunately, in the Canucks’ case, John’s company includes good medical coverage, which will fulfill their needs at this time.

Property and casualty. Besides requiring the obvious, such as purchasing adequate auto and homeowner’s insurance, Canadians living in the United States need to be made aware of the increased possibility of being sued in the courts. Therefore, they may want to consider purchasing an umbrella liability policy to complement their underlying coverages.

In Mexico, there is much less of a likelihood that they would be sued, and generally, only relief from economic damages can be received through the courts. As a consequence, liability coverage available through auto and homeowner’s policies is recommended; an umbrella policy is not usually a necessity.

Estate Planning

Cross-border estate planning has the same goals as domestic estate planning, but is substantially more complex. The ways and means of achieving the Canucks’ goals, however, will differ depending on where they reside in North America.

For anyone looking to move to the United States, the effect of estate taxes should be considered before making the final decision. Noncitizen residents of the United States do not get all of the benefits afforded citizens. One such benefit is that U.S. citizens can receive all of their noncitizen spouse’s assets under the unlimited marital deduction (at the time of the noncitizen spouse’s death) without paying any estate tax at that time. But noncitizen spouses are not allowed to use the unlimited marital deduction. As a general rule, noncitizen spouses cannot receive assets above the $1 million (U.S.) standard estate tax exemption without first paying estate taxes. The Canada/U.S. Tax Treaty can, by making certain elections, increase this exemption to $2 million (U.S.). Establishment of a qualified domestic trust (QDOT) can allow for deferral of estate taxes until the second death. Without proper planning, the estate tax can devastate the Canucks’ financial well-being.

Canada’s estate tax (although CCRA does not call it an estate tax) is known as the deemed disposition tax. The deemed disposition tax is a levy on any previously untaxed income held at death, such as unrealized capital gains and the value of a person’s RRSPs and RRIFs. Also, the province of Ontario has a probate fee of 1.5 percent of assets. Their current Canadian estate tax would be approximately $453,200 upon the second or simultaneous death. John’s estate, including the present value of his spousal pension benefit, is currently estimated to be $1.2 million (U.S.) at his death; Mary’s taxable estate would be approximately $500,000 (U.S.). Consequently, using the Canada/U.S. Tax Treaty and the other estate planning techniques outlined in this section of the Canucks’ cross-border plan, U.S. estate taxes can be eliminated. Therefore, U.S. residence is not an obstacle to them if they decide to move to Florida. If they follow the issues below, their total estate taxes could be eliminated, along with significant reductions in probate fees and administration costs.

If the Canucks move to the United States, there are several issues that their advisors must address.
  • Review the U.S.-Canada Tax Treaty with a view to make timely and appropriate elections. For example, the exemption amount can be increased to $2 million (U.S.).
  • Because noncitizen residents cannot avail themselves of the unlimited marital deduction at death, a qualified domestic trust, or QDOT, is usually an important part of these estate plans.
  • Estates may require equalization; however, planners must be aware that nontaxable gifts to noncitizen spouses cannot exceed $110,000 (U.S.) in 2003.
  • A qualified attorney with international planning experience should review the Canucks’ current estate plan and revise where appropriate by establishing living trusts and drafting wills, appropriate powers of attorneys, health care directives and living wills.
  • The Canucks may want to consider the possibility of acquiring U.S. citizenship in order to facilitate estate planning.
  • Titling of assets generally is best done through a living trust arrangement to avoid probate in multiple jurisdictions.
How an estate plan is organized in Mexico differs substantially from how plans are organized in the United States or Canada. Matters are simplified substantially by not having estate or inheritance taxes, deemed disposition rules and much lower probate fees. This does not mean that there is not a need for an estate plan that is appropriate to their particular situation if they live in Mexico. The points to consider are
  • The Canucks should draft a Mexican will that does not revoke prior wills and touches upon property in Mexico alone, especially if they buy property there.
  • Property purchased along Mexican beaches and international borders must be held in trust pursuant to Mexican law, in which case these instruments may work as will substitutes.
  • Important property, such as homes and investment accounts, should be titled properly so as to facilitate transferability upon death, and where appropriate, should contain beneficiary designations.
  • Mexican durable powers of attorney should be drafted, and if there is a possibility that the Canucks will be living in the United States or Canada in the future, or if they own significant property in these countries, powers of attorney valid in the United States and Canada may also be advisable.
  • Living wills and health care directives are not legally binding in Mexico, but these documents should be drafted if health care will be given in the United States or Canada.
Investments

It would not be possible to write a paper such as this and not make at least a passing reference to the subject of investment assets and their importance in cross-border financial planning. The principles of proper asset management apply regardless of where in the world those assets may be located. However, when people move across borders, new opportunities, as well as pitfalls, arise. It is enough to say here that an international planner must at least consider the following points:
  • Breadth of products and services
  • Investment expenses, such as fees and commissions
  • The workings of the currency market and exchange issues
  • Liquidity and marketability of securities
  • Where accounts and investments will be domiciled
  • Tax advantages and disadvantages of investments
  • Regulatory environment
  • Risk-return characteristics
  • Investment strategies for the short, medium and long term

Life Planning Issues

There are seldom any life planning issues that create more complexities and add more stress to a client’s nonfinancial life (outside of the death of a spouse, child or parent) than a cross-border move. The clients not only are changing locations, they are changing countries, where languages and cultures are “foreign.” Dealing with these life issues requires a great deal of preparation and research by clients and planners.

Over many years of cross-border planning and moves, both personally and in assisting clients, by far the best method of preparation we have found is for the client to “try on” the place where they want to live before they take the plunge and make the move more or less permanent. This dry run should consist of making short-term commitments, preferably renting accommodations in the country for several months at a time and spanning different times of the year where practical. Only after there is a level of comfort with the people, surroundings and culture should the cross-border move be finalized. Another life planning issue in a cross-border move is the distance from children, grandchildren, parents and lifelong friends, which can cause a significant sense of separation.

In addition, a proper cross-border plan should include provisions for what might be done after the death of the first spouse. For example, would the survivor wish to move back to the home country? Because of this possibility and others, cross-border planning should never slam the door shut on moving back. Some of the most creative planning can be accomplished by giving complete flexibility to the clients, allowing them to migrate back and forth between countries, to their personal and financial advantage.

Endnotes
  1. Mary Beth Franklin, “Foreign Intrigue,” Kiplinger’s Personal Finance (May 2000): 7.
  2. Money Magazine (June 1998).
  3. John Wood, “Strangers in Paradise,” Modern Maturity, www.modernmaturity.org/departments/2001/lifestyle/0505_lifestyle_a.html.
  4. Anna Mulrine, “Retiring Abroad Can Mix Joy and Hassle,” U.S. News and World Report (June 4, 2001).
  5. Jennifer Karchmer, “Where to Retire to Overseas.” CNNfn (July 7, 2000): http://money.cnn.com/2000/07/07/senior_living/q_retire_global/.
  6. According to the Political Reference Almanac, the United States is number 1, Mexico number 10 and Canada number 11 in terms of GDP. www.polisci.com/almanac/economy/fifty.htm.
  7. It is estimated that between 600,000 and 1 million Americans live in Mexico full- or part-time and that 1 million Americans live in Canada.
  8. A reported 5.2 million people who identify themselves as “Mexican” live in Los Angeles. U.S. Bureau of the Census, Current Reports, 2000: 250–511.
  9. According to the 2000 U.S. census, 7.8 million U.S. residents identify themselves as Mexican nationals. Profile of Foreign-Born Population in the United States, 2000: 12. http://landview.census.gov/prod/2002pubs/p23-206.pdf. Other sources estimate that about 1 million Americans live in Canada, and between 600,000 and 1 million in Mexico. Approximately 2 million Canadians live in the United States.


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