Every September, for our Annual Global Retirement Index, we rate 30 countries in the world under eight categories to give you the results of the best places in the world to retire to. This year, Ecuador is top of our scoreboard. Not only that, but it also wins in a category that is important to most people when they consider retiring overseas—the Cost of Living category.

Ecuador is the place to go to make your retirement dollars stretch even further. In fact, two retirees we know, Lee and Peg Carper live well here on less than $600 a month.

Lee and Peg live in Cotacachi, a small village in the Ecuadorian Andes two hours north of Quito. Cotacachi has a real sense of community. There are a couple of barbers, a small health clinic, and a pavilion for the town band. At night, the artisan shops close up and only a few restaurants and small mom-and-pop shops are open. That’s all you need. After a day of sunshine in the 8,000-foot-elevation mountain climate, night time is for sleeping.

The $600 a month covers their total expenses in Cotacachi—food, utilities, medical expenses, dog food, and even the rent on their new 1,200-square-foot apartment. An additional $100 covers miscellaneous expenses including cigarettes and a couple of cases of beer.

If you prefer to buy, you could follow in the footsteps of Dan Prescher. Dan and his wife Suzan have been spending time in Cotacachi since 2001. They fell in love with the place and bought a condo there last year. They now plan to spend part of the year in Cotacachi and rent it out when they are not there. Their condo, which they bought for $51,000, is a top-floor penthouse of a little more than 1,000 square feet with a fireplace, sunroom, outside terrace, and mountain views.

For city-living, look to Cuenca. Two years ago, Kent Zimmerman and his wife Christina decided to quit their jobs and take what they call a “career break.” They discovered Ecuador and moved to Cuenca at the end of October last year. They truly love the city.

Cuenca is a colonial gem with a stunning church on every corner and a festival almost every week of the year. The weather is perfect year-round. There are flowers everywhere, green grass, and rushing rivers (you can buy 25 long-stem roses for $4 at the market).

“The cost of living here is so low,” Kent says. “Our rent is $350 a month and includes all utilities, cable, and Internet. We spend about $400 to $600 per month on living expenses, not including Spanish classes, which cost from $5 to $8 an hour. We walk almost everywhere so our expenses for transportation are zero, but buses are 25 cents and taxis are $1.”

Cuenca real estate is affordable, too. For example, a new project being built in the historic district has 800- to 1,100-square-foot, two- and three-bedroom apartments starting at $43,000.

If you prefer living by the beach, our real estate expert, Ronan McMahon suggests Salinas—a seaside town located less than two hours north of Ecuador’s most populous city of Guayaquil. Its 9.5 miles of wide sandy beach has made it Ecuador’s “in” playground…perfect for sunbathing, boating, surfing, and sport fishing. The beachfront is lined with upscale highrise apartments, hotels, restaurants, and shops. Residents and visitors enjoy the sun and water sports during the day. The evening is for enjoying fine dining and the vibrant nightlife.

A new condominium community is being built at the edge of a tranquil, semi-private beach a few miles north of the malecón (boardwalk), and you can buy here for $50,000.

We’re not saying you should move abroad just because the cost of living is low (though that helps). The IL readers who have moved to Ecuador—to seaside resorts, mountain villages or colonial cities—all report back on how happy they are in their new havens.

“We have it good,” Peg Carper says.

Her husband Lee agrees. “In the last 50 years, we’ve gone from a society where Dad worked and everyone was happy to one where both Mom and Dad have to work just to make ends meet, and no one is happy. I’m enjoying life here."