Photo by Ian Armstrong
Initially I read a poorly written piece claiming that you could gain permanent residency in Ecuador only showing a $800/month income — similar to how you can gain permanent residency in Uruguay — but the article cited no sources. In the process of trying to verify that claim (send me info if you have it), I got sidetracked onto Peru.
You'll probably want to speak Spanish or Quecha, but Peru is now liberalizing their immigration policies and foreigners can now apply for a residence permit while in Peru. This gives you the advantage of being able to travel there, stay there for several months (you can live quite comfortably on $500/US a month) and decide if you wish to stay.
It also turns out that Peru has a thriving expat community, and under President Alan García, appears to be doing much better economically, though there's still crushing poverty for much of the country. Teaching English is a viable option there, and despite the strong economic growth and the housing boom, the average house price in Lima, their capital, is still just over $100,000. Outside of the capital, I'm reading about nice houses around $40,000 and under.
Photo by Malojavio El Saucejo
If you're like me, you hear "Peru" and immediately think Sendero Luminoso. While this terrorist organization is ceased to be much of a factor since the arrest of their leader in 1992, there have still been occasional problems such as the 2009 political crisis.
Peru, like much of South America, is truly an option for the adventurous, if you're willing to accept a bit of risk (probably not much, to be honest) in exchange for a an inexpensive and exotic lifestyle. South America appears to be having a bit of renaissance economically and those who are willing to take advantage of it may be very well off in the next couple of decades.