Retire in Portugal? Live Large, Affordably!

LouisHorkan

By Louis Horkan
Reviewed by Nathan Kattner

Table Of Contents

    Ever consider retiring in Portugal?

    If the thought of living one day in retirement as an expatriate in a faraway locale sounds appealing to you, then Portugal might be a place you wish to consider for lots of reasons.

    Introduction

    Consider the fact that for plenty of others that is exactly what they might be looking forward to doing when it comes to living out the second half of their life. Living the expat life. Maybe even retiring someplace really cool, like Portugal.

    Wow…

    Where’d that come from? I must be day dreaming again. Hope the boss didn’t notice.

    Sounds wonderful, though.

    It’s a great thought, but you know deep down that’s probably not happening for you. Right? A little vacay? Absolutely, but living…you’d have to be nuts.

    Maybe not so nuts. Consider the fact that for plenty of others that is exactly what they might be looking forward to doing when it comes to living out the second half of their life.

    Whether it’s a matter of you’re just looking for a different kind of experience in terms of some travel in retirement (especially extended travel to a really cool area) or the thought of living the expat experience is something your seriously considering, you might want to think about Portugal.

    Lots of others have and they wouldn’t change their decision.

    Today we are focused on living a life in retirement in a Mediterranean locale where many from around the world have chosen to live their golden years.

    General info

    Big picture items about PortugalWhen contemplating a new locale for the second half of your life (or at least some portion of it), you definitely want to become as familiar with the area as possible.

    It’s one thing to have stayed there in the past. Heck, you may have grown up there or spent a fair amount of time there for school, work or vacationing in the past.

    But you really need to learn the lay of the land as it is now in the present if you’re thinking of laying down roots there. Especially if considering doing so with a spouse or significant other who isn’t familiar.

    Getting familiar with the big picture is a good start. This should include things like general location (where it is situated from a practical standpoint), the population and the languages spoken. Also there’s the climate and whether that is something agreeable with you and your health.

    Other big picture items include:

    • How easy to move there
    • Culture
    • Faiths that are practiced and accepted
    • Traditions
    • What’s celebrated and customs
    • Things to do
    • Tourism
    • Things the place is known for
    • And, more

    Portugal, or officially the Portuguese Republic, is actually a very popular place for people contemplating retiring to from around the world.

    It was founded in 1143, according to the World Factbook by the CIA. It is the oldest nation-state in Europe, according to Expatica.

    The country is located on the Iberian Peninsula in Southwestern Europe. It is bordered by Spain to the north and east, and the Atlantic Ocean to the west and south. Its western tip is the western-most point in continental Europe

    The country is approximately the size of the state of Indiana or roughly 36,000 square miles. For the sake of comparison in the area, it’s about two-thirds the size of England. The border shared between Portugal and Spain is the longest uninterrupted borderline of the European Union countries.

    The country’s population is currently estimated at 10.24 million by the United Nations (U.N.).

    The capital and largest city is Lisbon, which has a current population of just over three million, making it one of the most populated urban areas in the European Union, according to Macrotrends and the U.N. The city is actually older than Rome and among the oldest in all of Europe.

    The official and predominate language spoken throughout the country is Portuguese, with more than 95-percent of the population speaking the language. English (approximately 15-percent), French (approximately 10-percent) and Spanish (approximately seven-percent) are also spoken.

    In terms of the climate, it is Mediterranean, so it’s warm but moderate in the summers and the winters are mild for the most part. Temperatures do vary some per region, but not by a lot. There is a rainy season during the winter.

    Photo of PortgualAs a member of the European Union, the currency used throughout the country is the Euro. It is also part of the Schengen Area in Europe.

    According to the Embassy of Portugal to the United States of America, this is important because as one of 29 member nations, those residing in or visiting in Portugal don’t need to use passports to travel to other members within the Schengen Area. That said, there are some restrictions in terms of the amount of time you can do so when visiting.

    Among its most notable historical contributions is the fact it is considered the world’s first maritime power. It was so during the 15th and 16th centuries and was home to some of the most recognized early explorers. One of the most notable is Ferdinand Magellan, who was the first person to circumnavigate the globe.

    Today the country is known, among other things, for its most famous export and national drink – Port wine. It also makes more than half of all the corks worldwide.

    In terms of safety, Portugal is ranked “third safest” in the world and the “fourth most peaceful” globally, according to World Population Review, an organization that publishes global population and demographics data. Portugal is also recognized as the “most friendly” among European countries.

    Additionally, the country is known for its warm and welcoming people, relatively inexpensive cost of living, thriving cultural arts scene, and relaxed pace of life, according to Global Citizen Solutions.

    Kick the tires

    As mentioned previously, no matter how familiar you might be with Portugal from your past, and especially if either of you has never been there, you definitely want to visit for an extended period, preferably up to three months. Maybe even a couple times before making the huge decision of relocating.

    The good news is this is easy enough to do as a U.S. citizens. You can actually do so without obtaining a travel visa. All you’ll need is your passport and a return ticket exiting the country within 90 days of entry, according to the Portuguese Embassy.

    In fact, if you only plan to live there on a part time basis in retirement, you can do so simply using your U.S. passport. Portugal allows you to stay in the country for up to 90 days in a six-month period as a tourist, according to International Living magazine.

    If you plan to live there for more than 90-days at a time or even permanently, then you are looking at a long-stay resident visa. More on that in a bit.

    When you do make this extended trip, you want to tour the country to the extent possible to gain familiarity and to determine where you might feel comfortable living.

    What would probably be more ideal would be a couple trips at different times of the year so you gain a better sense of what it would be like to live there on a year-round basis.

    And to stay for periods in different cities/areas during those trips, giving you a much better idea of where you will want to settle when you do so.

    You’re not talking a large area like the states, but there are differences from the north to the south and centrally, in terms of climate, culture and other issues, so it’s best to determine what suits your fancy before ever making the move.

    Retirement Planning Youtube Playlist

    Click to see all the latest retirement videos for your Retirement Planning research.

    Expatriate community

    If you’ve ever moved to a new place where you have literally no family, friends or anyone else you know, it can be tougher than you might expect. This is especially true if you and/or a spouse are social and like entertaining and doing things with friends and family.

    Throw in the fact most people are speaking a different tongue than you (assuming you speak little or no Portuguese) and things just got tougher.

    And then there’s the fact that just as in the U.S., each community has its own ways about it, ranging from how they do things, where to shop, festivals, accents, preferences, and much more. With no one to clue you in…talk about disorienting and a tall order to learn.

    For these reasons and many more, expats often tend to seek out others who are in the same boat.

    Portugal is considered one of the best places to live.These communities can be critical to those seeking to settle in a foreign locale. They’ve made the jump already and can help you learn the ropes in a new city or area. Ultimately they can make it easier to acclimate in the early months after moving.

    Chances are you will choose to settle in an area where there are other expats. These are likely to be people you’ll eventually befriend and engage in activities with.

    Fortunately, Portugal is famous for its expatiate communities, which you’ll find throughout the country, especially in the major areas such as Lisbon, Porto, the Silver Coast, and the Algarve, according to International Living magazine.

    The country is actually considered one of the best places to live in the world for expats from any country. As of 2022, the Portuguese government estimated there were approximately 10k U.S. expat citizens living in the country.

    While on the subject, it can be a good idea to research online and via social media for expat groups in the area where you plan to settle. You’ll likely find loads of information and resources for when you do make the move, and potentially even strike up friends in advance, which can make your transition all the easier.

    Affordable cost of living

    Beyond the beauty of the country, the moderate climate, history and friendly people, a major reason Portugal is so popular among expats from the U.S. is the affordable cost of living.

    Compared with its neighbor Spain, as well as many countries in Western Europe (e.g., UK, Ireland, Scottland, France, Germany), Portugal is inexpensive.

    Comparatively, you’ll pay more than 40-percent higher when living in the U.S. on average than living in Portugal. According to Global Citizen Solutions, the costs are even lower in the country when compared with high costs cities in the U.S., such as New York City, San Francisco, L.A., Chicago, et. cetera.

    Comparatively, you’ll pay more than 40-percent higher when living in the U.S. on average than living in Portugal. They also point out that rents and mortgages are the highest expenses proportionally that you’ll pay in Portugal, with costs for other items even less expensive comparatively.

    For further context, International Living magazine estimates that for those seeking to live in a thriving city such as Lisbon, the costs there are approximately 50-percent of that in New York City. And the largest expense, rents, is even cheaper – an average of 65-percent cheaper than in New York City.

    For other areas and those wishing to live on an even cheaper budget, rents can range from €500 to €1,100 and more per month, depending on the areas you wish to live. The magazine estimates that a couple, depending on their lifestyle, can live for €2,500 to €3,000 per month in Portugal.

    One other area to be aware of in terms of costs is that of purchasing a home, which for most involves apartments, but there are detached homes for sale as well.

    And you can get a mortgage from a Portuguese bank even as a non-resident. In fact, it’s fairly easy to do so, with similar qualifying requirements and terms as what you are used to in the U.S.

    Representative 2024 prices (source: International Living magazine):

    • Porto – two two-bedroom apartment near city center $250,000/house in the country $400,000
    • Silver Coast (one hour north of Lisbon) – small modern apartment in city center $150,000/large four-bedroom home in country $235,000
    • Lisbon – a modern two-bedroom apartment near the city center $500,000 and up
    • Algarve (Portugal’s southernmost region) – two-bedroom modern apartment near city center $280,000 and up/semi-detached house $400,000/three-bedroom home in golf community with sea-views $535,000

    Property taxes on homes range from 0.3-percent to 0.8-percent per year according to Portugal Simple Life.

    When it comes to taxes, you will need to check with your tax or retirement advisor, as there are different schemes for income and other taxes depending on how you are categorized by the government in Portugal, according to Global Citizens Solutions.

    Healthcare

    Obtaining healthcare in Portugal is fairly easy and the level of care is considered modern and comprehensive. Obtaining healthcare in Portugal is fairly easy and the level of care is considered modern and comprehensive.

    If you are staying 90-days or less, you are not required to have health insurance, but for periods longer than 90-days you must have VISA insurance with certain coverage requirements. Keep in mind this is separate from, and in addition to, travel insurance.

    When moving to Portugal you will have to have private health insurance, which is pretty affordable. It can run you from €400 to €1,000 per person per year, depending on age, health, type of coverage, deductible, et. cetera, according to Global Citizens Solutions.

    Once you obtain residency you are eligible for public health insurance through the public healthcare system, which is the Serviço Nacional de Saúde (SNS). The SNS guarantees public health insurance to all residents.

    Residency and citizenship

    In order to retire to Portugal as a non-European Union citizen, you will need to file for a D7 Visa, which is also known as a Portuguese Retirement Visa or the Passive Income Visa, according to Get Golden Visa.

    To do so you will have to file at your nearest Portuguese Consulate or Embassy in your home country. There are certain requirements, such as demonstrating you have minimum income (example – pensions or investments), proof of personal health insurance, provide a residence in the country where you will live, criminal background check, Portuguese NIF (Tax ID Number), et. cetera.

    Once the Visa is granted you can apply for a residency permit (retirement), which is good for a year. You can renew it after that year for a two-year period, and thereafter for another two-year period. After the five years of legal residency you can apply for permanent residency.

    You can even apply for citizenship thereafter, as the country allows dual citizens as long as your home country allows it.

    Separately, there is the well-known Portuguese Golden Visa program which allows for non-EU citizens to apply for residency outside of the D7 Visa program, according to Get Golden Visa. The Golden Visa program allows for an assortment of investments (venture capital, investment, arts, donations, et. cetera) into the country in order to qualify.

    Until recently it also allowed individuals to purchase real estate in order to qualify (minimum amount requirement – example $500k), but that scheme is no longer available.

    Culture and food

    The culture of Portugal is highly influenced by the fact that 80-percent of the population identifies as Catholic, according to the Portuguese government’s 2021 census. The culture of Portugal is highly influenced by the fact that 80-percent of the population identifies as Catholic, according to the Portuguese government’s 2021 census.

    As such, there is an abundance of related festivals and holidays celebrated on a regular basis throughout the year. The values and traditions that are prevalent throughout Portugal are largely influenced by the Catholic faith, according to International Living magazine.

    Food and wine tours and festivals are hugely popular throughout the country among tourists and the locals, as many towns host their own events throughout the year. And given the Mediterranean flavor and vibe that exists throughout the country, as well as the amount of sunshine, the country is known for its beaches and accompanying watersports activities.

    You’ll also find a plethora of cultural activities throughout most towns and communities, ranging from theater, arts, music and other types of festivals; many that are distinct to their host area. In addition to the beaches, there are many historical sites and national and local parks to visit throughout the country, so outdoor activities abound.

    As for cuisine, as a diverse international country you can find almost all types of foods available. But what the country is most known for is its seafood selection, which you’ll find in abundance just about anywhere, given the fact it is situated on the Atlantic Ocean.

    In addition to being famous for its Port, wines of all sorts can be found and are celebrated throughout the country. As mentioned previously, there are wine-focused tours and festivals that you can take advantage of throughout the year.

    Conclusion

    Let’s face it, we all deal with a magnitude of momentous decisions that we must take on throughout our lifetimes. Ranging from relationships, family and children-related issues, work, where we will live, healthcare…

    You name it, literally every aspect of our life requires lots of thought, planning and making big decisions.

    So, why would retirement be any different? It’s not. In fact, in many ways there’s more decisions that you’ll make related to your retirement. And if they aren’t carefully considered, they can cost you big time…even negatively impact the retirement you are hoping to live out.

    One such decision is where you will live. An accompanying decision is where you can do so in a manner that will allow you to live the best life possible in the most affordable manner.

    One potential answer is that of living in an area that provides great quality of life and an enjoyable lifestyle, while being able to do so at a more advantageous cost of living than where you do so currently.

    That’s why some just like you do more than just dream about living in a location like Portugal. It can offer real opportunities and advantages in the right scenario, maybe even for you.

    Speaking of retirement, wherever you stand (approaching or already retired), you definitely need to be following a solid retirement plan, including where you plan to live. One that can help ensure your plans and goals are fully incorporated and accounted for.

    At Oak Harvest we can look at your current retirement plan to determine if it can really meet your goals. Or we can assist you with a retirement plan capable of helping you do so. We can build a holistic, comprehensive retirement plan addressing relevant issues, utilizing strategies that cover taxes, income, spending, healthcare, legacy, and more, customized to your family’s specific needs.

    A plan created with the goal of ensuring you can successfully live out the retirement you and your spouse envision.

    If you are ready to take the next step and talk to a team of retirement planners who can advise on all your retirement needs, and who will put your interests first, Schedule a call today!

     

    Related Content

    Does Medicare Cover Health Expenses If You Retire Overseas?

    Retiring To The Dallas Area? Check Out These 8 Unique 55+ Retirement Communities

    Retirement Planning From a CFP®: 6 Keys to a Happy and Successful Retirement

    Five Important Steps to Planning a Secure Retirement

    Should You Retire In Thailand? The Pros And Cons?

    4 Most Important Things to Consider When Estimating Retirement Expenses

    Let Us Help You Achieve the Retirement You Deserve!

    Investment Advisory services are provided through Oak Harvest Investment Services, LLC a Registered Investment Advisor. Insurance services are provided through Oak Harvest Insurance Services, LLC. Oak Harvest Investment Services, LLC and Oak Harvest Insurance Services, LLC are not affiliated with the U.S. government or any government agency. Information presented is for educational purposes only intended for a broad audience. Not an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies.
    “Peace of Mind,” “Safety,” “Principal Protection,” “Lifetime Income, “Guaranteed Income,” or other guarantees are associated with fixed insurance products. No such language refers in any way to investment advice, investment advisory products, securities, or recommendations provided by Oak Harvest Investment Services. Investing involves risk. Rates of return are not guaranteed unless otherwise stated. All guarantees are dependent on the financial strength and claims-paying ability of the issuing insurance company. Annuities have limitations and are not appropriate for all circumstances or individuals. They are not intended to replace emergency funds or to fund short-term savings or income goals. Lifetime income may be available on certain products through an optional rider, at no cost or for an additional cost, depending on the contract. Insurance products are not insured by any federal government agency and may lose value. By contacting us, you may be offered information regarding the purchase of insurance and investment products.
    Oak Harvest has a reasonable belief that this marketing does not include any false or material misleading statements or omissions of facts regarding services, investment, or client experience. Oak Harvest has a reasonable belief that the content as a whole will not cause an untrue or misleading implication regarding the adviser’s services, investments, or client experiences. Please refer to www.oakharvestfg.com for additional important disclosures.