Thursday, August 17, 2006

San Miguel, where the living is easy, but not inexpensive

A few months ago, I blogged on the many articles that I've read in magazines and trade publications on "la vida cheapo." In fact, my articles on this subject are among the most popular on the blog, and you can read it by following this link: Not so cheapo

I knew when I went to SMA that I was not going to find any bargains this time around. I had to work through a real estate agent, which is the most expensive way to find a rental or purchase property. Nevertheless, not everything was outragiously expensive. Despite the rumors, this is not Santa Fe or Aspen. Here are some important economic considerations if you're planning to live in this community.

The first is that this is a great town with lots of upscale entertainment. You can amuse yourself with American movies at the Hotel Jacaranda, eat out a a variety of very nice restaurants, go to any number of art gallery openings, have or be invited to wonderful house parties, enjoy music at the three annual music festivals or every evening in the jardí­n, see great community theatre, and spend hours socializing (I mean real quality time) with the friends you'll make here. This is a very social expat community, and if you have even modest social skills, you'll never be lonely.

The second is that this is Mexico. This should be self-evident, but it bears repeating. On the surface, SMA looks like a tourist destination that is geared to meeting the comfort needs of the foreign visitor (or resident), but you will most likely run into problems with your water and electricity supply from time to time, and there will be times when you can't "buy" your way out of your inconvenience. Most of the expats I spoke with found this aspect of life in Mexico charming. One woman told me, "In the time you've been here talking to me, we're heard fireworks go off four times, heard the bells of the ice cream man, the shouts of the guy selling water, and the music from the [propane] gas truck. It can be noisy here [in her neighborhood], but I love it." obviously, the lifestyle is slow-paced and tranquil, but in SMA you're not in Kansas, and most expats are thankful for that.

The third is that it can be expensive, depending on your perspective. This is something that most expats lament, because according to those who have lived here the longest, it was once possible to live quite well on very little income. The link on the title of this post will take you to a NY Times articles on the various neighborhoods in SMA and their price ranges. I found the article interesting the first time I read it. Having lived in SMA myself, however, I find it even more informative (although not 100% accurate).

The bottom line is this: SMA is not an inexpensive place to live. This should not be a surprise, as what place that offers so much would also be inexpensive? When I spoke to Col. Philip Maher (the former U.S. Consular official), he told me that, at a minimum, one would need an income of about $1500 per person per month. When I floated this figure with some retired gringos who currently live in SMA, they said yes, $1500 per month would work, but only if you were cooking at home and not participating in any of the paid activities in town. For a Washingtonian like me, the housing prices seemed high, but affordable (you can still buy a nice house for $300,000, mas or menos). But as the NYT article indicates, people are moving out to less expensive neighborhoods to offset their costs. I will also note that if you do some web searching, you'll still find people who are trying to sell the idea that you can live in SMA on your social security check alone. NO ONE that I met in SMA thinks that would be possible, unless you have a big nest egg to pay cash for your house and you don't plan to spend much on entertainment or illness (Medicare is not accepted in Mexico).

On the other hand, I met several people who told me (jokingly) that they could probably live on the insurance premiums they no longer have to pay. You do not need liability insurance or those bothersome "umbrella" policies, and auto insurance runs about $300 per year. If you have a decent savings account and you are healthy, you could probably live without health insurance and pay out of pocket (even private physicians costs are relatively inexpensive). If you want private health insurance for Mexican hospitals, however, it will run about $6000 per year (depending on your age), which really is a bargain for full coverage.

Despite the costs, I found that most expats find in SMA something that is both priceless and (according to them) not available in the U.S.: quality of life. The fact that they can walk to the jardín most mornings and chat with friends or meet someone new is worth the costs and possible inconveniences associated with living in SMA.

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