"Panama is all that," reports just about everyone. Costa Rica is fabulous, too. So fabulous, we’ve decided to stay for the time being. Forever? I don’t know. Is anything forever? Once we realized returning to the states after our Year Abroad was not practical (still no income), or desired, we decided we might as well investigate other countries. Sounds kind of crazy now, but it made sense to us at the time…

Every once in a while, no more than once every 3 or 4 hours, Jal and I look at each other wide-eyed and ask, "Did you ever think we’d be living in Costa Rica? Or thinking about which country might be next?" I keep looking over my 1, 5 and 10-year plans (ok, the rough outlines) and the words "Costa Rica" are not found anywhere.

After narrowing it down and being swayed by all the positive press, Panama topped the short list. Chile was second in line, Buenos Aires was in there. Italy was definitely in the top five for the food, but too expensive, so we hear.

Nicaragua popped back up on the radar screen. We loved Nicaragua. Fabulous and exciting, it seemed a true Land Of Opportunity. Talk about getting in on the ground floor! In the end, we decided it would not be the LOO for the boys. The poverty there is wretched and complete. Schooling is a disaster. The (then) upcoming election cast a big fat shadow over the whole idea. Now that Ortega has won, Nicaragua is definitely out. At least until next year’s short list.

So Panama was first to be analyzed. We made a detailed pro-and-con list. On the negative side, since we are not retirement age and don’t have pensions, the least expensive way to become a Panama resident* is to invest $100K in a business. Well, we need to buy or start a business somewhere anyway. If we tapped every resource and lived on rice and beans for awhile, we could scrape this together.

Another con is that it’s hotter there. Much hotter, particularly in all the affordable places. Most people find that appealing. But hot and sweaty is our least favorite weather condition.

On the pro list, Panama is THE up and coming place to be, growing very quickly, an excellent place to have a business. Their tourism industry is NOT tapped out, like Costa Rica’s, so still tons of opportunity. Lower crime, they profess. They use the dollar. And Panama is hungry for expats. They want our money. Once the canal closed and the gringos moved out, Panama suffered mightily. It wants us back and is not shy about proving it in the form of incentives and tax breaks.

As opposed to Costa Rica which in many ways seems UN-welcoming. Little hints, like tripling the amount of investment money it takes to become a resident, taking away the pensionado benefits and tax breaks it used to offer. The very ones Panama is now promoting.

The critical factor for most expats is cost of living. If living is affordable, expats can live without the amenities and services we’ve come to know. Other factors weigh in, of course: quality of life (the #1 reason we are staying), less government restriction and interference. No military. But cost of living has to match the savings/income.

What happened? Costa Rica used to open its arms wide to expats. It worked: expats moved here in droves, set up shop, improved the economy, hired the locals, built houses. Still building, still hiring. But along the way, poco a poco, Costa Rica has been removing incentives, raising residency requirements and prices. It seems intent on changing its tax laws most unfavorably. They still want us and our money, but seem to believe all gringos are rich and easy. Greed is strangling the golden goose.

Even five years ago, you could live in the San Jose area for about a quarter of what it costs to live in a developed nation. Today, it’s a hair less than half. If you watch where you shop and what you spend. With just a little extravagance, you can spend the same while driving these unbelievable roads and not getting Triscuits at the grocery store. Where’s the fun in that?

Today, expats are leaving Costa Rica for Panama. It’s cheaper, more opportunity, more privacy, better roads, tax breaks and incentives. Incredible incentives for pensionados: everything from movies to travel is half price if you are getting S.S. or have a pension.

Why didn’t we move to Panama? Financially, we are not retired so don’t qualify for the pensionado incentives. And we aren’t buying property yet so tax breaks don’t come into play.

Emotionally, moving to one new country a year is enough. Costa Rica has grown on us. We finally know our way around, we’ve made friends. The theatre crowd has mistaken me for someone who can act. We have a great house. We are at home. Besides. It’s too hot in Panama.

*For accurate residency information for ANY country, contact an attorney or organization that specializes in that information. Do not – God forbid – rely on what you find in a book or on a website. The rules change often, dramatically and sometimes with no notice. In Costa Rica, we rely on the ARCR and, although the process is not without glitches, we are confident we are getting accurate guidance.