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Posted by on Jun 22, 2015 in Uncategorized | 22 comments

To Be or Not To Be – A Resident

To Be or Not To Be – A Resident

Steven Friedman guest posts today on a subject that is near and dear to me. Almost two years after applying for residency – we had all the requisite paperwork with all i’s dotted and t’s crossed – we still do not have our residency. I question our decision now more than ever – that may be a different post for a different time, but it does dovetail nicely into this article. 

You will remember, in addition to graciously contributing to Costa Rica Curious, Steve blogs on his satirical site My Satirical Side. As always, thanks for providing your perspective. 

To be… or not

Perhaps one of the most difficult choices you’ll face if you decide to expatriate to Costa Rica is whether or not to seek your Residency, or cedula as it is termed here.

To start with, obtaining your residency does not mean giving up your US or Canadian citizenship, nor does it mean you’ll automatically become a full citizen in Costa Rica or be able to legally work in Costa Rica. Nearly anyone can come to live in Costa Rica on a 90 day tourist Visa. This means that they must leave the country every 90 days. It is a matter of interpretation as to how long you must leave the country, but for the sake of argument, plan on being gone for at least the afternoon. When you re-enter the country, you are given another Visa stamp allowing you to stay for another 90 days, unless the border agent has a bug up his ass, and stamps your passport for a lesser stay. They can do this at their own whimsy.

Going thru the residency process exempts you from this and also allows you to get a drivers’ license, open a bank account, and get onto the National Health System – CAJA. You will have a temporary residency for at three years after which you can renew it for an extended temporary residency, or for a permanent residency. Each has their own rules, requirements, paperwork, and costs.

Becoming a temporary resident does not automatically qualify you to work here legally either. You still must also have a work permit from the government. This does not always apply if you are an investor or self-employed, but it is best to find out in advance before you start your own business here.

Currently to get your Residency, or cedula, will take you about one year, a lot of apostillized documents (more on this later), and a substantial sum of money. Word of advice – some people will tell you that you can do it all on your own. I heartily do not advise this! Most everyone uses an immigration attorney here to get their cedula and for good reason. The process can be arduous, and as Greg Seymour pointed out in his latest book – Living in and Visiting Costa Rica – Costa Ricans adhere not so much to the “letter of the Law” as they do the “Law of the letter”. By that I mean that if the translation of your documents (which you are required to provide), or something is missing, it can delay the process or force you to go and again hunt down some document.

If you have done everything you were supposed to, exactly as you were supposed to, and you and your attorney filed all the documents, you will be issued a “folio number”. This puts you at least in the queue which currently is about 9 months to a year. Getting your folio number does allow you to stay legally in the country for more than 90 days, but….. there is a catch 22. You may only legally drive on your tourist visa for the time limit on the last entry stamp. Violating this carries a heep of consequences. Thus you will still need to exit the country each 90 days not only until you get your cedula, but then after your last tourist visa has expired. Confused? No wonder!

So the question boils down to Should you apply for your residency at all, and if you do plan to apply, should you do so right away. This is a difficult question to answer, so I’ll try to lay out the arguments from both perspectives

Fuget Aboud It…..

As Hugh Grant murmured in that movie, or in other words, Forget About It! Don’t apply at all for your residency and become what has commonly known here as “A Perpetual Tourist”. There is nothing wrong with this. For a lot of Canadians who come down for only a few months of the year, this is the best course of action. You just have to be diligent and NOT stay over 90 days – come hell or high water (and sometimes this is literally the case). Given the statistic that 40% of people who come here will decide to pack up and repatriate in one to three years, this is not a totally bad idea. You also do not have to produce any documentation certifying your income. As far as the government is concerned, you are a tourist.

The consequences, other than having to leave the country every 90 days, are:

  1. You will be required to show a return ticket each time you re-enter. Sometimes you can get away with a bus ticket to Nicaragua or Panama, but airlines will not even let you board without showing a valid airline reservation to your native country. A photo copy of your airline reservation will suffice here. Many people make a fully refundable one before they leave the country, and then cancel it immediately when they return.
  2. You will not be able to open a normal bank checking account, but might still be able to get some type of bank account depending on your visa status. This means hitting the ATM’s a lot, having a pretty big limit on your credit card, or keeping a large wad of cash around. The later I would NOT recommend.
  3. You will not be eligible for CAJA, but under certain circumstances you might be permitted to use their services such as a Medical Emergency.
  4. You will not be able to obtain a Costa Rican drivers’ license, but may still drive and even purchase a vehicle with your current US or Canadian drivers’ license. You are also entitled to drive here on your US or Canadian drivers’ license as long as you are within your current Visa time limit.

Just Do it!

As my friend Arnie Schwarzenegger would say. Then the real question becomes “When should you do it?” There are some benefits to coming down and immediately starting the process. To start with you will need to produce certain documents that are Apostillized in your native country or origin. This means that they are officially certified as genuine typically by an official government agency and given a special stamp. Those documents are only valid for 6 months. You also have to consider that you will need to obtain all those documents such as birth certificates, marriage licenses, divorce certificates, and the like preferably when you are in your country of origin since getting them sent down here will take a bit of doing.

Now you could consider starting the whole process before you even set foot on Costa Rican soil. In the past the Department of Immigration required that applications be filed in your country of origin through the Costa Rican Consular Office in your country of origin. Under the current law the Department of Immigration will accept applications filed directly in Costa Rica with the Department of Immigration. However, if you file in Costa Rica as opposed to outside of Costa Rica then, in addition to the $50 application fee you will be charged an additional $200 fee for a change of status fee. Also you will need to be in contact with an attorney here in Costa Rica, and some operations such as getting fingerprinted need to be done here. Remember, the Costa Rican Government will not issue you a folio unless all the required documentation is complete.

Bring Lotsa Dough

Depending on your status – Pensionado, Rentista, or Investor, you will need to produce documentation showing steady income stream, or maintain a certain amount of currency in Costa Rican bank account. For pensionado, the amount is $1000 a month USD.

Typically the cost of getting your residency including all the fees, document copies, and everything else will run you about $1500 to $2000 per person! You will need to pay at least half up front for a retainer to your attorney, and also some initial filing fees. A good attorney will literally hand-hold you through the whole process and make sure that all the correct documents are together with the proper seals and stamps and everything is translated correctly. They will also check back with the Immigration people to make sure that nothing is missing and that you are still in the queue. Some immigration attorneys here have liaison offices back in the USA or Canada that can receive and process documents on your behalf and then forward them to your attorney in Costa Rica. The whole process is like one big ticking clock. All the cogs have to work together, or the watch stops.

So with all that said, the question remains – When should you file?
As I said before, about 40% of people who come here to expatriate end up leaving within 1 to 3 years. It is not always clear way you will go, or whether you’ll decide to make your home here permanent. Although your first year may be all Unicorns and rainbows, you may find that after that, you’ll want to move on or go back. In that case you will have plunked down a lot of cash with not much ROI. Waiting does have its rewards and drawbacks, but it will put you in a more educated frame of reference to base that decision.

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Gregorio

Greg Seymour is a quitter. At 41 Greg and his wife Jen quit their jobs, sold damn near everything they owned and became Intentionally Unemployed and retired early to Costa Rica.
In addition to writing on this blog, Greg has written for other online publications and has written two popular books about living in Costa Rica:
Greg Seymour Amazon Author Page

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22 Comments

  1. This is a good article – but it has one significant error. Documents that are “Apostillized” are valid for 6 months, not just 30 days. This should be corrected/ clarified.

    • Yep, thanks. Correct and corrected.

  2. Good food for thought

  3. Great summary of what to do and why you might want to do it. I really think it come down to a financial decision. If you are going to stay three years or less stay a PT and if you think it will be longer, invest in residency.

    • I think that is a great strategy. The problem is, most don’t know how long they are going to be here.

  4. Remember, those border runs every 90 days cost time and money also. Just a thought.

    • That was also our thought too when we applied. We didn’t want to have to leave. From a financial perspective attorney’s fees plus est. $400 a month into Caja – which we wouldn’t use much – that is a lot of cash you are out. Obviously, the longer one stays the better the situation. Still, not leaving is the one HUGE advantage for residency.

  5. My husband & I brought all of our properly completed documents with us when we moved here. On our 2nd day in the country, we met with our attorney, gave her a big deposit, and went to Immigration to get our finger prints done.

    After waiting for a year, we realized that we didn’t need the convenience of a CR bank account, and probably would never use the mandatory CAJA health benefits (at a probable cost of $150/month.) Leaving the country 4 times a year isn’t all that inconvenient, as we go back to the U.S. twice a year anyway, and enjoy going to Nicaragua for lunch, booze & medicines.

    When our approval finally came after 17 months, we told them “no thanks!”

    We will be moving back to the U.S. next fall to be closer to our kids & grandkids. We’ve had a great time here, and made many dear friends, so we will be back for vacations.

    I would recommend waiting at least 6 months and evaluating what benefits you could get with residency. For us, we decided that the benefits did not outweigh the costs.

    • I think that is very sage advice Vicki. Best of luck to you and your husband.

      • I have a caja question…is the price of it based on income? I was under the impression that it was much less expensive. I just found your blog and am so glad that I did.

        • Hi Ruthie,

          You are correct. The price of Caja is based (primarily) on income. So, for us, applying as rentista we show an income of $2500 a month – regardless of whether or not we spend that. For the pensionado the Caja payment is much less as is it based on an income of $1,000 a month. Add to our income level the fact that there is additional monthly expense for those under 55 and you will see Jen and I are in the most expensive category.

          Best of luck with your research. Feel free to email me with additional questions – costaricacurious@icloud.com.

          Greg

  6. So happy I found your blog. Seriously considering a move to CR. 61, retired, with a small pension ($1900/month after taxes). At 62 I will double that with SS. My 401k money is in an annuity that I won’t have access to for a few years after that, so money is not a big issue for me. I already have simple needs. My questions today are, 1. Can I bring my cat? In general, what hoops will I have to jump through to do so. A reference site would be helpful if you don’t have the knowledge readily available. 2. Do you have any contact or knowledge of people who have renunciated their U.S. citizenship? Mostly just curious. It is happening at record levels lately, mostly for tax reasons, I think. Thanks!

    • Hi Breck,

      Thanks for reading and commenting. CR is a good solution for many people – and a not so good one for many others. It is always a good idea to visit a couple of places for a month or two to make sure the country agrees with you. Your income level is such that you can live quite well here. We have found housing expenses to be significantly less than (even in) Dallas. Fruits and veggies too are inexpensive. Everything else will be the same or more expensive.

      On to your questions:

      Yes, people bring their pets all the time. Check out the forum on the ARCR for specifics – http://forums.arcr.net. If I remember correctly there is just a form that the vet needs to fill out and you need to have notarized. There is no quarantine. Rules change all the time so please verify, but know people travel in and out of Costa Rica with their pets daily.

      No, can’t really say I know much about renunciation citizenship. While the numbers are up, 3,000 in 2014, it is an tiny part of the population doing it. Also, it is my understanding that the government levies a tax on any money you are leaving with. My guess is it only makes sense for wealthy folk. I do not have that problem. Here is a Forbes article on the subject:

      http://www.forbes.com/sites/robertwood/2015/02/11/thousands-renounce-u-s-citizenship-hitting-new-record-not-just-over-taxes/

      Thanks again. If I can help with other questions shoot me an email – costaricacurious@icloud.com

      Greg

  7. Gregorio,
    I’m seriously considering moving to Cost rica for the same reasons you mentioned on your ” why I quit my job to move to Costa Rica ” blog. One thing that might make things a lot easier for me is the fact that was born in Costa Rica and posses a cedula and Costa Rican passport. I became a U.S. Citizen about 9 years ago which if incorrect does not affect my Costa Rican citizenship. I’m bilingual and Plan on teaching English. I may also drive up to the Intel corporation building and asking if I could land a job there. I hear being bilingual there is a huge plus. Any recommendations? I’m married and have to children. Love your post.

    • Hi Rene,

      Thanks for reading (and commenting). I think you have the most sought after skills here – and you are a citizen. I would think finding employment would be a cakewalk for you. On the whole though, unless you are self employed, the pay rates are pretty low here compared to the States.

      Best of luck to you,
      Greg

      • Thanks for the quick response. My wife is having anxieties about it. We have a couple of boys (8 and 10) and her concerns are the educational systems in CR. I didn’t mention that we were there for our honeymoon in 2002 for 10 days and we loved every single minute of it. Being born there myself had its perks. Within 10 days, I was able to get both my cedula and passport in time for my return to the states. The tourist guide who took us on a horse back ride told me I’d make “good” money there because of my US education, my CR citizenship and my ability to communicate both in Eng and Spanish. I’ll never forget that and had serious thoughts of moving there. Now, after having been laid off for the forth time in 5 years, I’m curiously considering moving there due to the high demand for my bilingual skills sets. Appreciate your insight and hope to one day be able to meet you if I take a trip out there to scout the land. Take care and continue to live the “pure life”.

        • Best of luck with your research. I don’t have kids so can’t help too much with the education question, but read through the comments on the CR Facebook groups – links on my resource page – someone there could help, I am sure.

          Feel free to email me with questions you might have – costaricacurious@icloud.com

          Greg

  8. Hello, I have purchased several books and one is yours and I am so enjoying your book. In 5 years I retire and considering moving to CR. I plan to make several visits to CR over the next 5 years at different times of the year. I will have about $3000 a month in retirement funds and hope that will be adequate to live there. I live in TX and plan to sell my home and all belongings. I read that if I mail a few boxes to CR that when the boxes arrive they will be opened and items will be missing. Have you heard of this happening? I was advised by a friend here in TX to look up an organization ACR [not sure those are the right initials] as they are very helpful.
    My plan is to research and read all I can between now and my first trip which is in the next 6 months; then visit yearly at different times of the year. I was also told it was better to arrive in CR with all the documents needed for residency. Thanks

    • Hi Barbara,

      Thanks for the kind words. I am glad you are enjoying the book.

      Whether or not $3,000 a month is enough is very much dependent on where you live and how you live. We have friends who live on $1200 a month and those that live on $6000. My wife and I live on $1500 or less in the Central Valley. That is living quite simply though. Our house is nice but we only go out to eat maybe twice a month and the rest of the time cook our own food. Also, we do not own a car. I would say for the average person $3000 would be plenty, both in the Central Valley or at a beach.

      ARCR is the organization you are referring to. They are a great organization to start your research with but they will point you in the direction of professionals connected to them. We are not happy with the performance of our attorney that came through them. Many friends have had much better experiences with other lawyers.

      I would think long and hard about whether residency is worth it. Personally, if we had to do over again we would not pursue it. Maybe take your first year hear and talk to a lot of expats before you pull the trigger. Residency is expensive and really only provides two things – 1) you don’t have to renew your tourist visa every three months and 2) Compulsory enrollment into the nationalized healthcare, Caja. Many people I know have supplemental insurance outside of Caja because of the programs inefficiencies

      As far as mailing, I would just bring what you need in suitcases. If you mail, it may or may not all arrive and you will be charged duty. In your luggage you will not.

      I hope this helps. If you need further help shoot me an email at costaricacurious@icloud.com.

      Oh, and if you get a chance please leave an Amazon review for my book. The reviews help a ton.

      Greg

  9. A donde envio preguntas a Greg acerca viviendo en Costa Rica. Todavia tengo libros por la familia Biesanz – “The Costa Ricans”; Jo Stuart – “Mariposa en La Ciudad: La Buena Vida en Costa Rica”.
    Yo soy un persona de tercer edad (80) y retirado desde 2001. Tengo muchos amigos Latinos aqui y en America del Sur y todavia vivo la vida Latino aqui en los Estados Unidos – Vivo para el ritmo Latino – Cubano, mariachi,bachata, merengue, Bossa Nova, la musica Tango por Astor Piazolla y la opera Carmen.

  10. Where do I go about sending questions to Greg about living in Costa Rica? I already have books by the family Biesanz -“The Costa Ricans”; Jo Stuart: “Butterfly in the City: The Good Life in Costa Rica” and others, plus a waterproof map of Costa Rica. I am a senior citizen (80) and retired since 2001. I have many Latino friends here and in S. America and I have been living pretty much the Latino life here in the U.S.. I positively live for Latino rhythms, whether it be Afro-Cuban, Mariachi,Bachata, Merengue, Bossa Nova or Argentine tango music by Astor Piazolla and the opera Carmen (featuring Placido Domingo).So, that is the English translation of the above comment awaiting moderation.

    • Hi Jamie,

      I will respond to you via your email.

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