Retirement Days, The Paperwork

CAPITAL GAINS AND INVESTMENTS AND WRAPPING IT UP

March 31, 2018

We have had to crunch new figures on the budget and see what we are up against since everything has changed. When you have $130,000-$300,000+ less than you planned on having some major shuffling and re-budgeting has to be done. And there is not a lot of space for error. So far it all looks like it will work out and we won’t have to get out of retirement. Hopefully I am figuring all the deductions out correctly to determine what our capital gains amount is that we have to pay taxes on. Boy, do those hurt. We find out on the 3rd of April if we are correct when we see our accountant and work out the Capital Gains tax etc. Fingers crossed. We owned the property (Glenn) and we have both had it for our permanent residence for two out of the past five years so we get the $500,000 exemption. We were able to take off quite a bit for the Home Improvements we did to the house, including adding in the entire basement apartment and laundry room downstairs and remodeling the main house upstairs. If we didn’t have those deductions we would not have been able to sell the house, retire and move to Mexico. We literally can’t afford the United States anymore unless we worked well over 70, and we can probably never come back to it. But we can live very well in many other countries. And that is what we are counting on. Let’s hope for no big surprises on the 3rd. I don’t think I can be off that much in my calculations.

We are so lucky that Glenn bought the house 20 years ago for $155,000 as it was a life saver and is providing us our new life. Our advise for someone selling their own house to be an expat, plan on the basic amount you think you are going to get for the sale and work your numbers from there. That way you will be more realistic and not as caught off guard. Also, don’t go overboard on staging, upgrading, and fixing the small things and really look at the amounts you will be charged and determine if you can write them off as house improvements for your Capital Gains reduction. Some things that you think can be taken off are not allowed to be factored in. And that reality hits you when doing your capital gains assessment. And looking back we don’t think we really needed to do some of it. If in the end you get more for your house than you thought then it is just an extra happy plus and those extras paid off.

After we received the money from the sale into our bank account, WOW!! was our reaction. Right there looking at that deposit meant we were going to be able to fulfill our dream of being retired expats abroad! I got a bit teary, as I am prone to do. Kenney our financial advisor came down right away last night and we went through all the paperwork and signatures for the investments we have agreed on. We are a being a bit conservative since we need a steady income stream immediately and have no time to wait for something to grow before tapping into it. We are happy with what we set up and it should provide what we need on an annual basis. Those investments plus some added savings should give us nice life without being too extravagant, and that is one thing we are not anyway. And we still get travel time in there, which is very important! Kenney walked away with our check to file the papers and get the i’s dotted and t’s crossed and everything ok’d. We should have things all in place by the end of next week.

We just have one more thing to do during this waiting time and that is to sell our car. Another thing that Glenn loves and it will be hard to part with.

We expect to be in our new house (rented) in the San Antonio neighborhood of San Miguel de Allende before the 15th of April. It is stunning and big and relaxing!! 2200 square feet! After living in our downstairs basement for years (660 square feet) this will seem a palace.

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2 Comments

  • Reply JC Webber III May 1, 2018 at 4:55 pm

    This has been such a FUN read. 8^)

    thx…

    • Reply ourprimeoflife May 2, 2018 at 10:02 am

      You are welcome. Glad to hear that you are enjoying the blog.

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