Top 9 Caribbean Islands for Your Retirement

Puerto Rico

Being a U.S. territory, Puerto Rico provides numerous benefits for retirees looking for a tropical climate without the need to move abroad.

Healthcare is readily accessible, and Medicare is accepted. Retirees can also purchase property in Puerto Rico without any restrictions or visa requirements. For eligible retirees, the Individual Investors Act exempts island and federal income taxes on dividends, interest, and capital gains for those who reside in Puerto Rico for at least six months each year.

The cost of living is approximately 11 percent lower than that of the mainland, and rental prices are about 53 percent less. In major cities like San Juan and Ponce, English is commonly spoken, but having some knowledge of Spanish is beneficial. The weather is warm but can be humid at times, and the hurricane season occurs annually from June to November, peaking in August and September.

There are several established retiree communities and assisted living facilities available. As noted by U.S. News & World Report, “Retirees will find it easy to adapt to life in Puerto Rico. The island serves as a retirement paradise, featuring large, active, and well-established communities of retirees from the U.S. mainland. Most retirees prefer to live around San Juan and the beach areas to the east, although expat enclaves can be found throughout the island.”

Isla Mujeres, Mexico

Situated in the Caribbean about eight miles from Cancun, Isla Mujeres was originally a fishing village. The vibe remains relaxed, and the cost of living is reasonable. This small island boasts beautiful beaches, warm and clear waters perfect for snorkeling and diving, delightful restaurants, and a lively nightlife. Housing options include apartments, condos, and hotels, with relatively low rents and overall cost of living. Most locals travel by motorbike or golf cart, eliminating the need for a car.

Retirees can obtain a temporary residency visa or a permanent visa (after four years) through their local Mexican consulate, subject to financial requirements. Those who secure legal residency can sign up for public health insurance for a minimal premium. Many opt for private insurance to cover medical expenses or choose to pay out of pocket. Medicare is not accepted, but it’s wise for U.S. citizens to keep their coverage in case they need to return to the U.S. for care.

U.S. Virgin Islands

The primary islands of St. Thomas, St. Croix, and St. John are appealing retirement destinations for those desiring pleasant weather, stunning beaches, outdoor recreation, and access to dining and nightlife. As a U.S. territory, the U.S. Virgin Islands do not require visas or passports for relocation. Medicare is accepted, and medical facilities are accessible on all islands. The currency is the U.S. dollar, there’s no sales tax, and English is widely spoken.

The overall cost of living is higher than that in the U.S., with rents approximately six percent above U.S. levels. A glance at recent listings revealed a broad spectrum of rental prices, influenced by factors like location, views, and amenities. Buying real estate on the islands is comparable to the process on the U.S. mainland, with attorneys representing both buyers and sellers. Dinogo A-List advisor Margie Hand remarked, “During my visit to the U.S. Virgin Islands last June, I was surprised by how many retirees I encountered. Some were working in local shops, and one was an artist selling his work to nearby stores.”

Turks and Caicos

Turks and Caicos is a British overseas territory made up of eight main islands and over 300 smaller ones. Average temperatures peak at 88 degrees Fahrenheit in July and drop to 81 degrees Fahrenheit in January, with a relatively dry climate. English is the official language, and the currency used is the U.S. dollar. “These islands are among my top picks in the Caribbean,” Hand shared with T+L. “However, the cost of living may be steep for some retirees.” In Providenciales, the most populated island and home to the international airport, monthly rents range from approximately $1,500 to $3,660 in the city center. Various options for purchase, including condos, townhouses, homes, and vacant land, are available at differing price points, with no restrictions on foreign property ownership.

The government issues temporary residency permits that require annual renewals and provides permanent residency to investors who buy property for personal use. The investment amounts range from $300,000 to $1 million, depending on the island, and funds can be allocated for new constructions or renovations of existing properties. There are no taxes on real estate, income, inheritance, or estates. Additionally, the new Health City Medical Centre on Grand Cayman offers a variety of high-quality and affordable healthcare services.

Anguilla

On Anguilla, the northernmost of the Leeward Islands, the lifestyle is relaxed, with popular activities including fishing, snorkeling, golf, tennis, and sailing for both visitors and residents. While the cost of living is relatively high, apartments can be found starting at around $1,000 to $2,000 per month. Importantly, there are no income taxes, VAT, or taxes on capital gains or inheritance.

Steve Haines, a long-time Anguilla resident and real estate broker at Trophy Properties, represents the Four Seasons Anguilla Residences. He shared with T+L, “The island’s highlights include its amazing people, ideal weather, and incredible food.” He noted, “I’m witnessing retirees buying residences for full-time living, alongside others who spend half the year here. It’s a blend of both.” Haines also mentioned that the island's new airport, currently under construction, will facilitate easier access for future visitors and residents.

Retirees can acquire property through an Alien Landholders license, subject to additional fees. Property owners are eligible for permanent residency. With only one hospital on the island, residents may need to travel to nearby St. Maarten or other islands for medical care, which is an important consideration when planning for retirement. It is advisable to have private insurance that covers transportation to the U.S. or a larger nearby city.

Dominica

Dominica, known as the “Nature Island,” is regarded as one of the most affordable Caribbean islands for retirees. There is an income tax that varies based on residency status and sources of income, but the island offers tax benefits for retirees, including a lower rate for those over 65. “Understanding the tax landscape in Dominica can be vital for individuals and businesses considering the island for investment and residency,” says Rihab Saad, managing director at Next Generation Equity, in a recent article.

For retirees looking to settle permanently in Dominica, the Dominica Citizenship by Investment Program allows foreigners to gain permanent residency by investing at least $100,000 in a government fund or real estate.

Both public and private healthcare options are available, with private insurance being advisable. Haines, who frequently visits friends in Dominica, remarked, “The island reminds me of Hawaii—very lush with fruit trees and stunning scenery. [It's a] wonderful place to live.”

Dominican Republic

Situated on the island of Hispaniola (alongside Haiti), the Dominican Republic stands out as one of the most affordable Caribbean islands for retirees. The cost of living here is approximately 47 percent lower than in the U.S., with rents around 75 percent less. Its tropical climate, accessible location (just about two hours from Miami), and numerous outdoor activities and entertainment options at resorts make it a highly appealing choice for retirees. Most expats and retirees settle in Santo Domingo, Santiago, or Punta Cana.

The Dominican Republic provides a retirement visa for long-term residency with reasonable financial requirements. Those wishing to enjoy their retirement here can initially enter on a standard tourist visa while awaiting their retirement visa approval. Social security and pension income are not taxable, but all residents are required to pay taxes on income generated from financial investments like stocks, bonds, and certificates of deposit.

As noted in a September 2023 article by Ashley Kilroy, an investment and insurance specialist at SmartAsset, “Expats should secure private health care insurance. While this is an added expense, visiting a doctor and receiving care at a private hospital in the Dominican Republic is generally more affordable than in the U.S. International health insurance can cost up to $200 monthly, covering most procedures, emergencies, and some prescriptions.”

Aruba

This small island in the southern Caribbean boasts a stable political environment, warm temperatures, and sits outside the hurricane belt. With resorts, museums, shops, and towns, there’s no shortage of activities and entertainment. Although the cost of living in Aruba is slightly above that of the U.S., rents are approximately 57 percent lower. There is an income tax, but retirees can benefit from exemptions on foreign pensions and annuities.

Aruba also offers quality healthcare, both public and private. Foreign tourists can remain in Aruba for up to 90 days (or 180 days for U.S. and Netherlands citizens). To extend their stay, an application for a residence permit must be submitted to the Department of Immigration and Naturalization Services. Applicants aged 55 and over may qualify for “retired with guaranteed income” status with a guaranteed annual income of at least $50,000. As noted by luxury Caribbean property expert 7th Heaven Properties, “The Government of Aruba encourages foreign investment and imposes no restrictions on foreign buyers purchasing property on the island for relocation purposes.”

Ambergris Caye and Caye Caulker, Belize

Nestled on Central America’s northeastern coast, just south of Mexico, Belize (formerly known as British Honduras) features a mainland and approximately 450 islands. Two of these islands, Ambergris Caye and Caye Caulker, are favored retirement spots, easily accessible by a short flight or boat ride from the mainland. During my visit to Ambergris Caye a few years back, I encountered retirees from the U.S. and Europe, happily embracing the slower lifestyle, using golf carts for transportation, and spending less than they would at home.

Belize correspondent for International Living, Shane Kenny, who relocated his family there in 2019, noted in a recent article, “Ambergris Caye, being a popular tourist destination, is one of the pricier places to live in Belize.” Regarding Caye Caulker, located about a 30-minute ferry ride from Ambergris Caye, Kenny mentioned, “Many view Caye Caulker as the more relaxed, smaller alternative to Ambergris Caye. Expect to walk everywhere, as the streets are unpaved and cars are not allowed — only a few golf carts.”

The Belize government provides information on how to obtain residency or retirement status through the Visitor's Permit Extension, the Qualified Retired Person Program, and options for permanent residency. Adding to its appeal as a retirement destination, the official language is English, and the currency used includes U.S. dollars alongside Belizean dollars.