On a recent flight from the Houston, Texas to San José Costa Rica I had the pleasure of meeting a very bright young woman who was being transferred to a new branch of her company in Costa Rica. Her name is Brittany and she hails from Austin, Texas. She explained that her company had offices in different locations but they chose Costa Rica for a new branch because of its highly educated work force and  lower operating costs. This process is called outsourcing and is growing increasingly more popular as U.S. companies strive to reduce costs and increase their profit margins.

Brittany went on to tell me that her company had found her an apartment near her office and was going to provide her with a car and driver. They even included first-class airline tickets when she had to travel to the U.S. However, despite all of these perks they never gave any type of orientation about Costa Rica.

When I explained to her that I specialized in the relocation business she couldn’t believe it. Our flight lasted three and one half hours and we talked during the whole trip. She probably asked me fifty or sixty question about living here and I tried my best to give her detailed explanations. Some of the subjects we discussed were the weather, entertainment, finding a good doctor, where to meet people, how to learn Spanish, banking, how to receive and send mail, personal safety for a single woman, beaches, cable and satellite TV, dinning, supermarkets and a lot more.

In order to absorb everything she took notes and I jotted down the names of some important contacts for her. I recommended she sign up for the monthly newcomer’s seminar sponsored by the Association of Residents of Costa Rica. It is highly informative and a must for anyone who moves here. Some of the topics included are: real estate, banking, insurance, health care, learning the language, taxes abroad, culture and more.

After hearing what the seminar offered she promised to attend the next one.

When our flight landed in San José she thanked me for all of the valuable information I gave her. She said meeting and talking with me really made her feel more prepared. She paid me one last compliment by saying that anyone moving here to work or retire should take advantages of my services.

The information I gave Brittany is just a small of amount of what people will learn by reading my guidebooks and above all by taking one of my popular relocation/retirement tours. The latter are an ongoing seminar.

New York, August 12, 2008 — Moody’s Investors Service has revised the outlook on Costa Rica’s key ratings to positive from stable in recognition of the significant improvement in the country’s fiscal and debt positions and the likelihood of such improvement continuing in the medium term despite ongoing global turbulence.

The outlook change affects Costa Rica’s Ba1 foreign and local currency government bond ratings. The outlook on the Baa3 foreign currency country bond ceiling and on the Ba2 foreign currency bank deposit ceiling was also revised to positive from stable.

“Costa Rica’s remarkable fiscal performance over the past few years has been driven by significant expenditure restraint and an improvement in revenues, reflecting not only the business cycle but also a concerted effort to enhance collection,” said Moody’s Vice President — Senior Analyst Alessandra Alecci. “As a result, the fiscal and debt positions have improved to such a degree that it would take a major crisis to reverse the virtuous debt dynamics seen in recent years.” Costa Rica’s fiscal and debt indicators have begun to converge towards the investment-grade level.

She said that the most surprising aspect of the government’s fiscal performance is the control of expenditures. Despite campaign promises and pent-up demand for infrastructure and social expenditures, outlays have actually contracted significantly in recent years, in part due to lower interest payments but also due to a more targeted effort to address social needs. The degree of autonomy of the Finance Ministry from political influence has been particularly impressive, she added, which is a testimony to the maturity of Costa Rica’s institutions.

“The decision to change the outlook to positive comes at a delicate time for Costa Rica, whose key macroeconomic variables are being affected by the global slowdown and credit crunch,” said Alecci. “We focus our ratings on the fundamentals rather than the business cycle.”

She said that the strength of the fiscal anchor and the fact that the majority of Costa Rica’s public debt is in local currency and mostly held by public entities mitigates the risk associated with a potential, albeit unlikely, disorderly exit from the current exchange rate regime”.

“Notwithstanding recent strong pressures on the balance of payments and the volatility in the exchange rate market, the external position and the economy as a whole is equipped to deal with this type of shock,” said the analyst. “Foreign exchange reserves remain at historical highs relative to imports and to the money base, giving the authorities ammunition to handle the current difficult transition towards a free-floating exchange rate regime as well as the widening of the current account deficit.”

Costa Rica has been the recipient of unprecedented high levels of foreign direct investment in recent years, which have more than fully financed its current account deficit, despite the delay in joining Central American Free Trade Agreement or CAFTA. Given the resilience and diversification of its economic base, there is, thus far, little evidence of a sharp drop in non-debt creating external financing that would lead to a meaningful deterioration of Costa Rica’s external debt indicators.

“We will carefully monitor how Costa Rica navigates through these challenging times,” said Alecci. “In particular, we will observe the performance of the fiscal accounts and whether financial dollarization, one of the key rating constraints, will significantly increase.” A severe problem with the exchange rate regime would have important implications for the banking system which is close to 50% dollarized, she underscored.

Millicom International Cellular S.A. has agreed to purchase Amnet for $510 million. Amnet is Costa Rica’s leading cable provider and a major provider of high-speed Internet. The company has 350,000 corporate and residential accounts in Costa Rica, Honduras and El Salvador. The transaction in with months.

Millicom has 8.8 million subscribers, mostly under the Tigo brand in Central America. The firm is the leading supplier of mobile services in Guatemala, El Salvador and Honduras and is a publicly traded company on the Nasdaq and reported $1.2 billion in income in 2007.

As you can see the big players continue to pour investment money into Costa Rica

This is a question that crosses many Americans minds who are planning to move here because they are constantly made aware of the threat by the media, the U.S. government and when the traveling through airports.

The first thing you need to know is that Costa Rica abolished its army over 50 years ago. What an amazing feat! Too bad the rest of the countries in the world don’t follow suite. Because of this amazing accomplishment Cost Rica has more teachers than soldiers and spends the money it would have had to spend on an army on education and health care. There is a small national police force, but in no way resembles a standing army.

Furthermore, the country has no external enemies nor does it meddle in the affairs of other nations. Because Costa Rica is a peaceful country  it is not wracked by violent elements that devastate other Latin America countries like Mexico and Colombia. The latter is plagued by car bombings and a strong insurgency. Mexico, on the other hand, suffering from kidnappings and an epidemic of drug related violence.

I have also heard that Costa Rica will not issue visas to people from certain countries in the middle east. I don’t know the reason for this measure but can only assume it is a safeguard.

When you read the title of this article you will probably think that it is impossible to live so cheaply and so well. This especially true if you reside in an expensive area of the U.S. like California. You could probably scrape by on a few thousand dollars a month up north but you certainly wouldn’t be living in luxury.

Let’s see why the title of this article is true. A couple who owns a $150,000 home (three bedrooms and three baths) free  and clear and has a car will probably have the following monthly expenses in Costa Rica.

Private medical insurance $200
Dental care $50 per month
A part time maid $100 to $150
Part time gardener $30
Beauty parlor $75
Food including inexpensive fruits and  vegetables form a
Farmer’s market and many imported American products $500 per month
Entertainment (movies, socializing) $200- $300
Dinning out a couple of times a week $300
Private gym $50 – $100 per couple
Country Club (after you pay initial fees) $100 to $200 per month
Car insurance for a relatively new car $100
Utilities (water and electricity) $100
Telephone (using Vonage or Skype for long distance) $75-$100
High speed Internet $50
Cable or satellite TV $50
Car repairs $50
Garbage $40 per year
Property taxes on your $150,000 home $20 per month

Misc. expenses $300

Other possible expenses
Travel to U.S. or other countries $3000-$5000 or more per year

Really your lifestyle determines what you will spend here. You can choose to spend a lot more money if you are a high roller or yuppie type  or substantially less if you wish to live modestly. I know single people who live for less than $1000 per month and others who have expensive tastes who spend what they would in the States. Nevertheless, you can live very well on the budget above. I should know because I have lived here almost 30 years and buy and do everything I want for under $4,000 monthly.