禁漫天堂

We retired prior to becoming expats, so our days of contributing to retirement savings are behind us!

We maintain bank accounts in the US and use those for accepting pension payments. We鈥檝e had no issues accessing our accounts from here.

If you rely on a local job you will quickly find there is NO money for retirement savings.聽 聽If your earning come from outside of here, then your retirement savings will likely be outside of here as well.

I do not recommend any local savings plans!

Do not come here with an expectation to make a real salary and save to retire. Do that out there and then retire and move here.聽 OR聽 have a remote job.

Having access to pension or retirement funds from abroad is only one issue to consider.聽 There are many more (which one should be concerned about regardless if you are retired in Arizona, Thailand, The Dominican Republic, etc.)聽 Namely inflation or the ability of the currency your retirement funds are dominated in to still afford a standard of living that you want. So with that said what is the correct mix of interest income generating investments in USD versus Dominican Pesos? Many upper & middle class Dominicans of course keep funds in USD or Euros to hedge against currency devaluation (read inflation) of the Dominican Peso but is the real rate of currency devaluation in purchasing power of the peso worse, better or about the same as the USD?聽 We already know that food prices in the US have gone up 200% or more (some statistics report a 400% increase) from the period 2020 to 2024 in the US reflecting the loss of purchasing power of the USD if you were still living in the US.

One major advantage of retirement in the Dominican Republic is of course cost of living which is a fraction of what it is or could be in many US locations (obviously living in places like NYC or LA much more expensive than say a small town in the Midwest).聽 Likewise, Santo Domingo & Santiago more expensive than say San Francisco de Macor铆s or Mao.聽 Punta Cana of course is a tourist destination and aesthetics of living there aside you are paying 鈥渢ourist鈥� prices for both food & accommodation so choosing where to live equally important as well.

So, how do you hedge to make sure you have the best mix of both income AND possible purchasing power protection going forward? The first step is to educate yourself on the REAL rate of currency debasement or inflation.聽 Many people call the US Bureau of Labor & Statistics (BLS for short) the Bureau of Lying Statistics for good reason. Likewise the Dominican Central Bank may not always put out the whole truth and nothing but the truth either (as can be the case with most central banks). And so you are going to have to commit yourself to read.

Dominican Banks currently are paying about 5% in interest for USD certificates of deposit (plaza fijo) and about 9% for certificates of deposit in Pesos. But if you hold any USD based investments either in the US or the Dominican Republic AND you live in the Dominican Republic are you hedging against US cost of living or Dominican cost of living? Is 5% compensating for any real decline in the purchasing power of the US Dollar? And what about currency exchange rates between the USD & the Peso?聽 As of June 2025 the claim is the rate of inflation in the Dominican Republic is about 3.5% BUT the historical long term average over the past few decades has been about 5% or so. However, if you are earning the average 9% interest rate in Pesos then you are staying above both the current inflation rate and the longer term average.

Should you keep ALL of your money in Dominican Peso denominated investments? NO. Should you keep ALL of your money in USD denominated investments? Also NO. Rather, the mix should be a function of how much retirement income you might want or need from your investments AND with an eye towards hedging against any future debasement (read devaluation, inflation) of both currencies. Also be aware of debt because it does matter when it comes to a number of things including the value of a nation鈥檚 currency. In 2025 the national US Debt to GDP ratio is 124%, in the Dominican Republic it鈥檚 46% (as of August 2025).聽 Just something to think about.聽 聽

If you are coming here to work and save for retirement, just don't.聽 Stay where you are and save for retirement.聽 Get advice from an advisor who knows you and your situation

Having access to pension or retirement funds from abroad is only one issue to consider. There are many more (which one should be concerned about regardless if you are retired in Arizona, Thailand, The Dominican Republic, etc.) Namely inflation or the ability of the currency your retirement funds are dominated in to still afford a standard of living that you want. So with that said what is the correct mix of interest income generating investments in USD versus Dominican Pesos? Many upper & middle class Dominicans of course keep funds in USD or Euros to hedge against currency devaluation (read inflation) of the Dominican Peso but is the real rate of currency devaluation in purchasing power of the peso worse, better or about the same as the USD? We already know that food prices in the US have gone up 200% or more (some statistics report a 400% increase) from the period 2020 to 2024 in the US reflecting the loss of purchasing power of the USD if you were still living in the US.
One major advantage of retirement in the Dominican Republic is of course cost of living which is a fraction of what it is or could be in many US locations (obviously living in places like NYC or LA much more expensive than say a small town in the Midwest). Likewise, Santo Domingo & Santiago more expensive than say San Francisco de Macor铆s or Mao. Punta Cana of course is a tourist destination and aesthetics of living there aside you are paying 鈥渢ourist鈥� prices for both food & accommodation so choosing where to live equally important as well.

So, how do you hedge to make sure you have the best mix of both income AND possible purchasing power protection going forward? The first step is to educate yourself on the REAL rate of currency debasement or inflation. Many people call the US Bureau of Labor & Statistics (BLS for short) the Bureau of Lying Statistics for good reason. Likewise the Dominican Central Bank may not always put out the whole truth and nothing but the truth either (as can be the case with most central banks). And so you are going to have to commit yourself to read.

Dominican Banks currently are paying about 5% in interest for USD certificates of deposit (plaza fijo) and about 9% for certificates of deposit in Pesos. But if you hold any USD based investments either in the US or the Dominican Republic AND you live in the Dominican Republic are you hedging against US cost of living or Dominican cost of living? Is 5% compensating for any real decline in the purchasing power of the US Dollar? And what about currency exchange rates between the USD & the Peso? As of June 2025 the claim is the rate of inflation in the Dominican Republic is about 3.5% BUT the historical long term average over the past few decades has been about 5% or so. However, if you are earning the average 9% interest rate in Pesos then you are staying above both the current inflation rate and the longer term average.

Should you keep ALL of your money in Dominican Peso denominated investments? NO. Should you keep ALL of your money in USD denominated investments? Also NO. Rather, the mix should be a function of how much retirement income you might want or need from your investments AND with an eye towards hedging against any future debasement (read devaluation, inflation) of both currencies. Also be aware of debt because it does matter when it comes to a number of things including the value of a nation鈥檚 currency. In 2025 the national US Debt to GDP ratio is 124%, in the Dominican Republic it鈥檚 46% (as of August 2025). Just something to think about.聽 - @wbernard2069711

Very astute observations; all very accurate.

If I may comment on the 9% rate for Certificates of Deposit in the DR, for the benefit of other readers:

1. First, YES, that 9% interest rate on Pesos "CDs" is REAL!聽 We've been enjoying that rate for over two years.
2. At our particular bank, they aren't "certificates of deposit."聽 Rather, they are "Fixed Term Savings Accounts."聽 聽Make sure you're asking for the right thing, or you may get blank looks.
3. In our experience, it was a waste of time visiting regular branches (at least for our bank) to inquire about the Fixed Term Savings (FST) accounts.聽 We tried at two local branches:聽 the CSRs had no clue what we were talking about, and assured us the only types of savings accounts available were the "regular savings accounts."聽
4. I don't know whether they simply didn't know/had never been told, or if they might be steering us toward products they would benefit from personally.聽 Be skeptical.
5. We KNEW our bank offered these products -- a friend had accounts with the same bank.聽 Our lawyer advised us to seek out a "commercial branch," which apparently most DR banks have (though they may have different names for them).聽
6. Once we got to a commercial branch, located in one of the upscale shopping malls, things went along fine.聽 They knew exactly what we wanted.聽
7. BE FOREWARNED: Bring passports, cedulas, recent bank statements, and be prepared to identify your source of funds (if it isn't going to be your account at that same branch).聽 If planning to wire money in, be sure to ask for DETAILED WIRING INSTRUCTIONS.聽
8. As with all things DR banking, the process of opening this new account was excruciatingly SLOW, despite our already being customers.聽 It took about 3.5 hours between arriving, waiting to be seen, and having the accounts set up.聽 YMMV, of course.聽
9. I suggest bringing light reading, your charged-up phone + a spare charger/battery and wearing comfortable clothing.聽 If you chill easy in DR air conditioning (like we do), then don't wear shorts, consider long sleeves, and bring a sweater or jacket also.

These 9% rates are quite attractive, but everyone should heed wbernard's warnings about keeping an eye on inflation rates.聽 I would at minimum own or be invested in assets or equities with significant protection against inflation.

1. As a teen during the high-inflation 1970s, I know all too well how damaging inflation is to one's budget and investments.
2. Take care that you pay attention to this area.聽

Best to all,

Jim

ExpatRusher

And please factor in the value of the peso!聽 If you look at its history you will see that the 9% quoted rate gets eroded by exchange differentials.