Using an Annuity to Meet a Visa Income Requirement in 2026: Where It Works and Where It Doesn't

Written by Hans Goldstein, licensed insurance agent · CA 4273294
Updated October 2026

Here is the problem I see over and over. An American in their 60s has done the work: real savings, a paid-off house, Social Security on the way. Then they read a consulate checklist and learn that the money in the brokerage account may not count. Retirement visas ask how much arrives every month, and whether it will keep arriving. I started digging into this because my mom is Norwegian and my dad is American, and they’re planning the move from the US to Norway. I’m writing this to help others in the same boat as my parents.

This page makes the case for a lifetime annuity the way I rank it: first, does it meet the income requirement better than the alternatives; second, how will the new country tax it. Then the currency question, a 29-country scorecard, and a plain answer to whether it makes sense everywhere.

Why a lifetime annuity meets income requirements that savings cannot

Income tests ignore savings

A visa income test is a forecast: will this person support themselves for years without local public help? A balance can be spent down, so many countries look past it. Norway’s UDI says plainly that “own funds (money in an account)” do not count. Italy’s consulates generally refuse savings balances on their own for the elective residence visa. The Netherlands counts only income that continues for at least another 12 months. Other countries accept savings (Spain, Greece, France, Sweden, Mexico), but usually as a pile you must show again at every renewal.

A life-only single premium immediate annuity (SPIA) turns part of that balance into a fixed monthly payment for as long as you live. On paper it looks like a pension: a contract, an insurer letter stating the amount, and deposits landing every month. That is exactly the evidence income tests are built to read.

Why “lifetime” and “not capitalizable” wording matters

Several countries spell out the kind of income they want, and the wording decides which annuity qualifies:

• Panama: a certified lifetime pension of at least $1,000 a month, and the regulation expressly covers private pensions administered by a foreign insurer (Decreto Ejecutivo 320 of 2008, art. 201, as amended in 2009).
• Costa Rica: a permanent, stable pension from abroad of at least $1,000 a month, certified as lifetime (Ley 8764, arts. 81 and 82).
• Spain: the Los Angeles consulate lists being the beneficiary of a “life annuity, not capitalizable, payable by a public or private institution.”
• Norway: UDI counts pensions and “periodical benefits (insurance payments or similar)”, and time-limited annuities, such as 5-year or 12-year contracts, do not count.
• Colombia: a certified lifetime pension of at least 3 minimum wages (Resolution 5477 of 2022, art. 77).

“Not capitalizable” is the key idea. If you can cash a contract out, an officer can reasonably treat it as savings in a wrapper. A life-only SPIA has no cash-out right, which is precisely why it reads as income.

Renewals: the same line every time

Most permits are renewed, and the money test comes back each time. Spain accepts savings, but a two-year renewal on savings alone means showing €57,600 for a single person, and every year you spend down, the balance looks thinner. Costa Rica renews temporary residence with a fresh pension letter; Belize wants a yearly Belize bank statement showing the deposits. A lifetime annuity shows the same monthly amount in year one, year five and year fifteen. Panama goes further: its pensionado permit is indefinite, with no renewal at all.

Couples: the sponsor and main-applicant point

For a married couple, whose name the income is in can matter as much as the amount:

• Norway: the test is on the Norwegian spouse (the sponsor) alone; the American’s own income counts only if he or she works legally in Norway. The annuity belongs in the sponsor’s name.
• Netherlands and Sweden: same logic. It is the Dutch or Swedish sponsor’s income that is tested.
• Spain: the main applicant shows €3,000 a month for the couple (400% of IPREM plus 100% for the spouse), and the rules do not say a spouse’s separate income can be added, so keep the income in the main applicant’s name.
• Panama: $1,250 a month for a couple, and spouses may add their two pensions together.
• Costa Rica: one $1,000 lifetime pension can cover the applicant and spouse.

Two practical points. If the annuity is on one life and that spouse dies, the survivor may need lifetime income of their own at the next renewal; a joint and survivor annuity solves that, at a lower payout per dollar. And if the premium comes from the other spouse’s money, the transfer is a gift between spouses: unlimited between two US citizens, and up to $194,000 in 2026 to a spouse who is not a US citizen before Form 709 is needed (Rev. Proc. 2025-32). An annuity bought with IRA money has to be owned by the IRA owner.

Which annuity designs count

Designs that read as lifetime income:

• A life-only SPIA: the highest payout per dollar, paid for one lifetime.
• A joint and survivor SPIA: paid as long as either spouse lives.
• An existing deferred annuity or MYGA converted to lifetime payments (annuitized).

Designs that usually read as savings: a period-certain annuity (10 or 20 years, then it stops), an income rider (GLWB) on a contract whose account value you can still cash out, and any annuity still accumulating, such as a MYGA earning its fixed rate. These can fail tests that require lifetime or non-capitalizable income. Buy while you still have a US address, and start payments 3 to 12 months before you apply so the deposits show on your statements.

What it costs at 62

Premium needed = monthly gap / payout per $100,000 x $100,000. In the ImmediateAnnuities.com survey of September 9, 2026, a life-only annuity bought at 62 paid an average of $603 a month per $100,000 for a man and $582 for a woman (best quotes $660 and $637). So each $1,000 a month of shortfall costs roughly $152,000 to $172,000 of premium. Social Security, which can start at 62, counts as income from abroad in most of these tests and shrinks the gap. Illustrative, not a quote.

Then tax: what your new country takes

Tax is the second filter, not the first. As a US citizen you keep filing a US return, and on an annuity bought with after-tax savings the exclusion ratio treats part of each payment as your own premium coming back untaxed. What changes is the host country:

• No local tax on the annuity: Panama and Costa Rica (territorial systems, and the payment is foreign-source), Belize (statutory QRP exemption), the Dominican Republic (declared qualifying income exempt under Law 171-07) and the Philippines (a resident alien is taxed only on Philippine-source income). US tax is the only tax.
• Only a slice taxed: Spain taxes 24% of each payment from an annuity set up at 60 to 65; Germany 21% if payments start at 62; Portugal only the income part; Ireland relieves the capital element.
• Whole payment taxed: Norway taxes the gross payment at 22% and credits the US tax, but a US annuity sits outside Norway’s wealth tax, which makes it the best option there for Americans with real savings; Italy likely taxes the whole payment at ordinary rates.

Where both countries tax, a treaty or credit usually leaves you paying roughly the higher of the two bills, not both. Since January 1, 2026, a US citizen with a foreign residence address cannot opt out of federal withholding on annuity payments, even into a US account (Treas. Reg. 31.3405(e)-1); withholding is a prepayment of your US tax, not an extra tax. Country detail is on how Europe taxes a US annuity and wealth tax by country.

The trade-offs, once

A SPIA is irrevocable: the premium becomes income, and you cannot take it back as a lump sum. Payments are fixed in dollars, with no inflation adjustment unless you add a cost-of-living rider, which starts lower. The income depends on the insurer’s claims-paying ability, so choose a highly rated one. And buying younger means a lower payout per dollar: $603 a month per $100,000 at 62 versus $714 at 70 for a man. Size it to the gap plus headroom, not to your whole net worth, and keep the rest of your money liquid.

My annuity pays dollars, but the bar is in euros: the currency question

This is the question I hear most from couples heading to Europe. A US annuity pays dollars. Spain’s bar is €2,400 a month, Norway’s is in kroner, a Swiss canton judges your means in francs. If the dollar weakens, the same check covers less of the bar.

Here is what actually happened to someone living on dollars over the last 20 years, from the European Central Bank’s monthly reference rates, January 2006 to September 2026. “Change” is how much more (or less) local currency one dollar buys; the “worst” columns are the worst rolling stretch for a dollar earner.

• Euro: over 20 years a dollar buys about 5% more euros than in 2006, roughly a wash. The path was bumpy: the worst 12-month and worst 5-year drops were both about 15%.
• Norwegian krone: the dollar gained 41%, and over every 10-year window since 2006 a dollar ended up buying more kroner, never fewer. Single years still saw drops of up to 20%.
• Swiss franc: the outlier. The dollar lost 36%, and the worst 5-year stretch was a 37% drop. In Switzerland a dollar annuity needs more headroom or a franc cushion.
• Dollar countries: in Panama, Ecuador and Belize the bar and the check are in the same money.

Past exchange rates do not predict future ones. The table shows the size of the swings a plan should survive, not where the dollar goes next.

How to handle the currency gap

• Size with headroom. Aim 10 to 25% above the bar; the Run my numbers calculator on this page uses 15%. At $1.17 per euro, Spain’s €2,400 is $2,808 a month, and 15% headroom means about $3,229. That absorbs a drop of about 13% in what a dollar buys. To ride out a repeat of the worst 15% year without touching savings, use 20 to 25%, or the next tool.
• Keep some savings in the local currency. A euro (or krone, or franc) cushion covers a weak-dollar year, so an exchange-rate dip never shows up as a thin statement at renewal.
• Consider a cost-of-living rider. It raises the payment every year, in exchange for a lower starting payment.
• Count Social Security’s own raises. Social Security gets an annual cost-of-living adjustment, so the part of the bar it covers grows over time.
• Know whether your bar moves. Many bars rise every year in local currency: Norway’s is 3.2 G, and G rose about 4.9% on 1 May 2026; Colombia’s is 3 minimum wages, and the 2026 minimum wage rose about 23.7%; Argentina’s peso bar rises every month. Others stay flat: Spain’s IPREM has been €600 a month since 2023, so the €2,400 bar has not moved. A rising bar is a second reason for headroom.

Scorecard: how well an annuity fits each country in 2026

Two scores out of 10, in my order of priority. Income-requirement fit is how much a lifetime annuity helps you qualify compared with the alternatives: high where savings do not count or lifetime income is required, low where a deposit or savings is cheaper or there is no income test. Tax fit is how lightly the country treats the annuity, wealth tax included. Overall weights the income requirement first. These are my judgments from the country guides, not official ratings; each country links to its guide and sources.

Does an annuity make sense everywhere? No.

Top tier: Panama, Norway, Costa Rica, Spain, Belize. Panama and Costa Rica require lifetime pension income outright, so a life-only SPIA is the direct way in, and their territorial tax leaves the annuity to the US. Norway never counts savings, and a US annuity in the sponsor’s name is the one tool that both meets UDI’s test and stays outside the wealth tax. Spain’s consulate names the exact product, and only a slice of each payment is taxed. Belize names annuities on its form and exempts the income by statute.

Strong: Ireland, Italy, Colombia, Ecuador, the Dominican Republic. The annuity fits the income test well in each; the tax side or a document question (Italy’s full-payment tax, Ecuador’s unclear classification, the Dominican pensioner certificate) keeps them a step below.

Middle ground: Germany, Portugal, the Philippines, the Netherlands, Austria, Argentina, Greece, Switzerland, Uruguay. An annuity is a clean way to document income, but savings, a deposit or other income also work, or the permit turns on discretion or other conditions.

Not the right tool: Mexico, Thailand, Malaysia, Denmark, Sweden. In Mexico about $78,000 on deposit beats roughly $700,000 to $800,000 of premium for $4,630 a month at 62. Thailand accepts THB 800,000 in the bank (about $23,900). Malaysia’s MM2H has no income test, only a fixed deposit. Denmark sets no income figure at all. Sweden, from 1 October 2026, accepts two years of assets in the sponsor’s name, which is far cheaper than buying income it may not count. France, Malta, Cyprus, Finland and New Zealand also score low because savings count, the bar is low, or other conditions decide the case.

In those countries a lifetime annuity can still be a sensible way to pay for retirement. It just is not what gets you the permit, and I would rather tell you that than sell you something you don’t need. Never treat any annuity as a promise of approval: get the consulate’s or immigration office’s view in writing before you buy.

Frequently asked questions

Related reading

• Moving abroad on a fixed income: hub
• Retirement visa income requirements compared
• Wealth tax by country and the US annuity
• How Europe taxes a US annuity
• Panama pensionado visa income requirement
• Move to Norway from the USA: Norway guide
• Spain non-lucrative visa income requirement
• Costa Rica pensionado income requirement

Sources

• European Central Bank Data Portal: US dollar per euro, monthly reference rate (EXR.M.USD.EUR.SP00.A)
• European Central Bank Data Portal: Norwegian krone per euro, monthly reference rate
• European Central Bank Data Portal: Swiss franc per euro, monthly reference rate
• Decreto Ejecutivo 26 of 2009, amending Panama Decreto Ejecutivo 320 of 2008, arts. 201 and 203
• Costa Rica Ley General de Migracion y Extranjeria No. 8764, arts. 79, 81 and 82
• Consulate General of Spain in Los Angeles: non-lucrative residence visa
• Real Decreto 1155/2024, Reglamento de extranjeria (arts. 61 to 64)
• Ley 31/2022, Presupuestos Generales del Estado 2023 (IPREM)
• UDI: Income requirement in family immigration cases
• Utlendingsforskriften chapter 10 (section 10-8), Lovdata
• NAV: Grunnbelopet (the basic amount G)
• Skatteetaten, Skatte-ABC F-24-2.1 Livrenteforsikring, formue
• Cancilleria de Colombia: Resolution 5477 of 2022 (art. 77)
• Belize Retired Persons (Incentives) Act, Cap. 62, s. 4(4) tax exemption
• Social Security Administration: cost-of-living adjustment
• Treas. Reg. 31.3405(e)-1 (T.D. 10008): no withholding opt-out for a foreign residence address from 2026
• IRS Rev. Proc. 2025-32: 2026 annual exclusion for gifts to a non-citizen spouse
• ImmediateAnnuities.com: immediate annuity rates by age (survey of September 9, 2026)