international living article

I Doubled My Income by Moving to Panama

Last Updated on June 18, 2023 by Retire in Panama

international living articleOur friends,at International Living, recently interviewed, co-owner of Retire in Panama Tours, Rod, to talk about his move to Panama 8 years ago, and what he is doing now.

When I moved to panama, I was not retired, I was earning income, and paying a lot of Taxes back in Canada. Now, to double your income, you can do two things. If you are retired and it currently costs you $3,000/ month to live, and you move to Panama and now it costs you $1,500 a month to live, you have basically doubled your income. Or you can go from paying a lot of taxes, then move to Panama and pay no taxes because of Panama’s territorial tax system, read the article to learn more.

The article was originally published in The Savvy Retiree online Magazine, here it is:

December, 2019

Rod Larrivee moved from Vancouver, Canada in 2011. Rod says, “Back in 2005, I started an online work from home business, managing websites for companies, doing their SEO (Search Engine Optimization), Local Search Marketing and Pay Per Click advertising campaigns.  Within 2 years this gave me a full-time income.

In 2008, I was speaking to an online friend that did the same thing as me, who then was living in Thailand. I asked him why he lived in Thailand?  He replied “because I can work from anywhere, I have a computer and internet connection”
At this point he refereed me to International Living, where I joined the newsletter, and started considering becoming a digital nomad myself.

My reasons were simple.
1. Pay Less Taxes, as you may know Canada has a very high tax structure, especially for single people running small businesses.
2. Better climate – I had had enough of Canadian winters.
3. Less government regulation in my life, and a more laid-back life.

After a year of research, and reading a lot of International Living articles, I narrowed it down to 4 countries, Thailand, Costa Rica, Panama, and Paraguay. After much debate by mid-2010, I decided Panama would be my best choice due to its Time Zone (most of my customer then were in North America), climate, and Territorial Tax system. “

Rod continued,” When I moved here, I was doing SEO and running companies online advertising.  Then I moved into other online areas like affiliate marketing and drop shipping, Amazon fulfillment, and now I do the online work for a company that I am co-owner of here that helps expats move to Panama. I would consider my work full-time.  I do not have a daily schedule, but more of a routine, that is flexible.  I wake up at 6am, not because I have to, but that is just by body, and it’s when daylight breaks in Panama.  I have coffee, read a bit, check out what is on the calendar, and check emails. I keep a calendar, with my daily objectives in it, to keep me on track, but if someone says “Beach Day” I have that option.

I am probably more than full-time now :), but I do love the work I do, as I used the skills I had learned online in the last 10 years, and with my business partner, Oscar Peña, we opened a company in Panama 2 years ago, www.retireinpanamatours.com, that brings  people looking to move to Panama, for whatever reason, to show them around, and give them access to all the right people  so that if they decide to move here, they will have all the contacts necessary to make that move a success.

So I built the website, do the SEO, manage the Pay Per Click advertising campaigns and Social media ads for my company, just like I have done for years for others, and Oscar manages the tour part.”

I asked Rod if he makes enough to cover the lifestyle he wants in Panama, he said, “Yes, that is no problem.  When coming here, after I attained my permanent residency with the Friendly nations Visa, at that time, one of the easiest visa to get in any country for someone still in their income producing years, I effectively double my income, as Panama only taxes Panamanian sourced Income, and Canada does not tax you if you do not reside in Canada.

I now teach this to the guests of our Retire in Panama Tours, that starting an online business and generating income from outside of Panama, can be tax free.  Even for US citizens, as they can receive a $100k foreign resident tax exemption once they are a permanent resident here. People who are retired, can even do this to for a little extra income.”

Rod says about the reliability of internet in Panama, “I have lived in 6 places in Panama since I have been here, from Panama City, to David to Boquete, and have had excellent internet. I currently have service from Cable Onda, which provides 160mb internet, bundled with 200 tv channels, and a land line, for $54/month.”

Although Rod works full time, he does find time to get away at the beach for a couple nights each month and spend dinners with friends. He also travels across Panama seeing the country as part of the tours he does once a month. Rod says,” When I moved to Panama, it was like living like a King, there was no way to spend the money I was making.  I had double the money (no taxes) and ½ the expenses. Things like going to a movie here in Panama is $5, paying my car insurance is $230 a year, my electrical bill in Boquete is $25/month, up in the mountains where there is no need for heat or air conditioning, a full unlimited data cell phone plan is $32, and lunch at the local Panamanian restaurants is $3.50.”

I asked Rod if he would recommend being a digital nomad for other potential expats. He said, “Yes, I highly recommend this type of work.  I not only recommend it, I encourage it. I consult here with others who run online business, helping with marketing, SEO, fulfillment centers in North America.

If you currently do not work online and are considering moving to Panama and starting an online business, make sure you are coming here with enough money in the bank to sustain your lifestyle for a couple years. Starting an online business, just like any business, will take some time and do not expect to be making any good money from it for a year or two.

For those currently working online part time, maybe as a side hustle to generate a second income, this is something to consider.  Maybe that side hustle is not generating enough money to sustain your life at home, but maybe if you kept all that money, like owing no tax on it, it would be enough to sustain a lifestyle here.
For those of you thinking of moving here, start that online side hustle now, before you move here, and get it generating some money for you before you move.

Examples of online business that digital nomads do here that I have met are:

– Affiliate Marketing, where companies pay you a percentage for driving traffic to their site to generate a sale.  I currently receive a deposit in my bank every month from Amazon, as I market some of their products, and they pay me a commission
– Drop Shipping – This is a really big business, where you build the web site with products of a specific company, you sell at retail, collect the money, go to the dropshippers site, order that product at wholesale, and have it shipped to the customer
– Freelancing – Great way to make a full time living if you have a special skill with sites like Odesk, iWriter, Fiverr, Toptal.  Can you write article? Can you proofread or edit content? Create graphics, do website work? Do you Code? These sites have an endless supply of work that needs to be done.
– Coding – There are many coders in Panama living of the income from they earn from sites like Toptal
– Amazon Fulfillment.  – Import products and sell them on Amazon, and let Amazon collect the money, fulfill the product and handle the customer service.”

Rod also had some good advice for internet,” One thing to consider, have some back up internet, just a cell phone data plan is good enough, as you will have an outage or two per month, and get some backup power, as the power grid infrastructure is not as good as it is in North America. The power outages are more frequent and they happen more in the country than in the city, mostly show outages, but can be a couple hours.  I simply picked up two deep cycle marine batteries, a 1500 watt inverter, and a charger, and have that power going to my desk running the computer, monitors, modem and WIFI. Power outages never affect me.”

 

Come on one of our Retire in Panama Tours, and we will show you how you can do this! See tour dates HERE.

 

Similar Posts

Leave a Reply

Your email address will not be published. Required fields are marked *