La Paz Centro, Nicaragua

This tiny town of 28,118 people is hardly the idyllic Central American paradise many expats dream of. The shops and pottery may seem quaint, but the long-running feud with neighboring Nagarote over the best quesillos is a telling sign of the pettiness that can dominate local life. And while the Asososca Lagoon may be pristine, the town was also the site of a violent battle between U.S. Marines and Nicaraguan rebels not long ago. Bureaucracy and tensions with other towns are persistent headaches here.

La Paz Centro is best suited for those looking for a sleepy, unambitious retirement, far removed from the hustle and bustle of Nicaragua's more vibrant cities.