Where can you live in luxury on a state pension?

MalaysiaEye Ubiquitous/Press Association Images

The cost of living in the UK is reaching astronomical levels. According to the Joseph Rowntree Foundation, we now need more than £1,600 a month in order to maintain even a basic standard of living. However, under proposals for the new flat-rate state pension, we'll be looking at a monthly income of £607.

Clearly life in the UK is going to be incredibly hard. However, a magazine has unearthed several places around the world where you can live in luxury on these sums. So where are you going to have to live?

International Living magazine compiled its list of five possible retirement destinations, where you can live a good standard of life on the cheap. These may sound slightly unusual choices, but when you consider that many of them throw in things like air conditioning, a maid, entertainment, and health insurance, they start to seem worth a second look.


Top of the list was Nicaragua, where you can live well on £609 a month. However, you need to balance the fact that you could live with a great deal more luxury than in the UK with the fact that this is an incredibly poor part of the world.

The Foreign and Commonwealth Office (FCO) warns of threats from a number of diseases, including TB and Swine Flu. There is also the rainy season to contend with, and the fact that since Christmas there have been significant gas and ash eruptions from the San Cristobal Volcano.


Second is Malaysia, where you can live on £612 a month - which is only just outside your budget and includes things like a mobile phone and internet. A couple on just over £1,227 could live a life of relative luxury.

Add in the beaches and the relaxed way of life and it may be highly tempting. However, the FCO warns that there are some additional risks. There is a kidnap risk in Eastern Malaysia, general terrorism risks, and threats from scams, bag snatching, and drink spiking.

There are also serious questions about human rights, so, for example, public gatherings which did not have prior police permission have been known to trigger reactions from the police including tear gas and water canons.


Third is Ecuador, where a luxury lifestyle costs £867 a month. However, this luxury needs to be balanced against a large number of FCO warnings.

These include recommendations not to travel to a large number of areas where armed gangs operate, and volcanoes to avoid because of volcanic activity. It also says that armed robbery is on the increase (it calls it a constant hazard), and recommends that Britons traveling to these regions don't wear expensive jewellery or walk alone in many areas. It also says that armed gunmen regularly hold up buses, and that you shouldn't travel by road at night.


Fourth is Panama, where luxury costs £1,142 a month (including a full-time maid). There are risks here too, particularly street crime (where the FCO recommends never carrying anything valuable), and serious hazards in the areas surrounding the border with Colombia. However, away from the more dangerous areas you can live a modern lifestyle in comfort.


Finally, Mexico is fifth, where a luxury lifestyle is possible on £1,304 a month. You have to contend with natural threats from hurricanes and volcanoes. There are also some no-go violent areas, and a risk of car-jacking in some areas, including the border and Pacific Highway.

The FCO says you are recommended not to drive at night, and avoid travelling off the beaten track. It also warns of street crime risks, and that express kidnappings are a problem - particularly in urban areas - where you are taken by a gang and forced to withdraw cash before they will release you.

Clearly you have to take the rough with the smooth when you're living in luxury on a tight budget. So what do you think? Would you live in any of these places? What's the alternative?

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