US retirees looking for lives of comfort at bargain-basement prices might do well to look at a sunny, sophisticated city near the equator.

By MSN Money staff

US retirees looking for lives of comfort at bargain-basement prices might do well to look at a sunny, sophisticated city near the equator.

The best place in the world to retire, according to expatriate lifestyle magazine International Living, is sunny, cheap, cosmopolitan and 8,000 feet high in the Andes.

Cuenca, Ecuador’s third-largest city, is a well-preserved colonial city of cobblestone streets and dramatic period architecture, with modern suburbs, shopping and all the comforts American retirees might expect. Yet they can live there — and well — for about $17,000 a year, the magazine says.

Cuenca and Ecuador in particular have so much to offer, says International Living Managing Editor Laura Sheridan, that the country bumped Mexico from the top spot in the publication’s Annual Retirement Index, released last month.

The index analyzes and ranks 29 countries in categories including real-estate costs, special benefits offered to retirees, culture, safety and stability, health care, climate, infrastructure and cost of living. The rankings are below.

“We look closely at the best opportunities worldwide for retirement living,” Sheridan says. “Where will the retiree’s dollars go farthest? Which country is the safest? Where is the health care best? We give top priority to those things that matter most to anyone planning for retirement, including programs with special benefits for retirees . . . things like tax breaks and discounts, for example, that various governments offer in an effort to attract investment and retirement dollars.” Read the rest of this entry »