You will find a diverse range of biomes available to explore if you are thinking about spending your retirement in Costa Rica. Whether you find yourself in the cloud forests or standing on the white-sand beaches, this country offers some incredible rewards when you decide to live here during the next phase of your life.
For most retirees, living in Costa Rica requires fewer financial resources than it takes to live in the United States or most other developed nations. Single Americans can often make this decision happen with only their Social Security check supporting them. If you decide to move as a couple, then your housing expenses per person get cut even further, allowing you to have an affordable, enjoyable time together.
Costa Rica is a nation which delivers modern cities, entertainment venues, cultural attractions, and reliable infrastructure. You have access to the beach, climbing trails, and urban hiking environments. There are even multiple methods of applying for a visa to live in the country as a retiree so that almost everyone can qualify in some way.
If you are a budget-conscious retiree who is looking for a way to extend the value of your savings, then here are the pros and cons of retiring in Costa Rica to begin considering.
List of the Pros of Retiring in Costa Rica
1. You can retire to Costa Rica without much in savings.
The average cost to retire in Costa Rica is about $18,000 per year. That breaks down to a median monthly expense of $1,500 per month for an individual retiree or $36,000 per year for a couple. These expenses including your medical care, housing, food needs, and transportation costs. If you don’t mind going down there to live on the light end of the spending spectrum, a couple can retire in this country for about $2,500 per month. Since that is about the same amount that you’ll receive in Social Security benefits, it means you can live a good life down there without worrying about what is in your savings account.
2. There is a specific immigration program for retirees.
Since Costa Rica is a relatively short plane ride from the southern border of the United States, the journey to reach this retirement destination is simple enough. You will just need to ensure that you have taken care of your bureaucratic responsibilities to stay there so that your retirement can be everything you dreamed it could be.
Your first resident option when retiring to Costa Rica is the Pensionado Program, which was made specifically for retirees. You must verify that you earn a minimum monthly income of $1,000 per month from a retirement fund or pension. Then you must transfer those funds into a local bank account and spend it in the local currency. The Rentista Program qualifies you if you hold a current cash balance of $60,000 or a monthly income of $2,500 for at least 2 years. You must renew the program status every two years at a cost of $100 each.
3. You can retire in Costa Rica if you invest in a local business.
If you do not qualify for the two standardized retirement programs and still want to move to Costa Rica, then you can do so by immediately investing at least $200,000 into an approved property or business in the country. There are no other income qualifications with this option at the time of writing, although you will need to pay a $250 application fee. The consulate also charges $40 per document for authentication, along with any translation and notarization fees that are necessary.
In most situations, couples that move will have one spouse apply and prove their income levels or purchasing power. The other will be classified as a dependent for entry purposes.
4. There is an option to apply for permanent resident status.
Once you complete three full cycles in one of the retirement programs in Costa Rica that allows you to immediately immigrate there, then you can decide if you wish to apply for permanent residency. You can continue to process the renewals if you want, but after six years of being in the country successfully, the government will give you the option to make your transfer permanent. There may be financial considerations to look at if you do this that might impact your pension or benefits, so consult with a professional advisor before considering this potential advantage.
5. Costa Rica offers a universal healthcare program.
The government-run healthcare system in Costa Rica is called Caja. Residents are charged a monthly fee based on your current income for access to the program. In exchange for this payment, you receive doctor’s visits, medication, and even surgeries if they become necessary. You will no longer need to worry about the expensive cost of some procedures that Medicare might not cover in the United States with this benefit. You can even choose to visit a private clinic if you prefer and pay for it in cash if you don’t like the idea of universal care. There are also private health insurance plans available in the marketplace.
6. The country prefers to practice political neutrality on the global stage.
Costa Rica is one of the largest countries in the world today that does not have a sitting army. After a devastating civil war in the late 1940s, the leadership of the nation at the time decided that the violence was something that they never wanted to experience again. You will still have a significant police presence in the country to protect you, but the government’s commitment to peace and prosperity makes them a true neutral where there is no threat of political agenda interfering with your retirement.
7. You can try living in Costa Rica first to see if you like it.
Costa Rica does not require citizens of the United States to have a visa before entering the country. The only stipulation that you have is to show a valid passport upon arrival. The customs agent will want to see a return ticket to grant you entry as well. Then you can stay there for up to 90 days to see if you would want to retire there. If you do, then you can return to arrange your affairs, complete the paperwork, and then make everything official.
8. It is easier to return for a visit with your family in Costa Rica.
Retirees might love what life offers in Costa Rica for them, but there will be times when you miss your family as well. When you make this country your home, then it is possible to purchase a round-trip ticket from here to several American cities for about $300 per person if you plan in advance. That makes it a lot easier to come back to see everyone without destroying your budget when compared to other popular retirement destinations like the Philippines.
9. You will have opportunities to make plenty of new friends.
If you are an American, then retiring to Costa Rica might take you away from your family and friends, but it can also help you to make new ones. Not only do you have the entire culture to start exploring after you make the move, but you will also find yourself in familiar company. There are more U.S. residents per capita in the country than anywhere else in the world outside of the United States. There are some adjustments that you will need to make in the first days after your move, but there will be several moments where you can experience some familiarity as well.
10. Permission to move to Costa Rica doesn’t mean permission to work.
Most of the retirees who move to Costa Rica and need some additional income look at the option of a web-based business. You are unable to work as an employee on any of the visas that allow you to live here after you retire. The country does allow you to own a company and receive dividends from it. You are also permitted to operate as a freelancer if your customers or clients are outside of the country.
List of the Cons of Retiring in Costa Rica
1. It can be difficult to adjust your circumstances if you change your mind.
Costa Rica is not a country for everyone. If you didn’t do your homework on the country before deciding to retire there, then you might wake up one day deciding that you hate your new home, despite the country, and would do anything to reverse your decision. Living a modest lifestyle here to extend your retirement savings can create a boring life for some people and couples. If you bought a property at too high of a price, it might take forever to sell it.
You can counter some of the problems in this disadvantage if you start renting first and try different locations. It can be helpful to spend the first couple of years looking around for a place that you love.
2. You must pay significant attention to your lifestyle choices.
If you manage your money wisely in Costa Rica, then you can legitimately retire here for under $20,000 per year as an individual. Some expats envision a life where they live at the beach, take daily walks along the surf, and then have a late, large breakfast. Then they spend an afternoon enjoying the sunshine or exploring the community before having an early dinner to do it all over again.
The reality of retirement in Costa Rica is that you will need to cook most of the meals yourself. If you are on a tight budget, then a property by the beach is out of the question. You might not even be able to afford a place in the city. That’s why it is a good idea to take a vacation here first before deciding if this is going to be your retirement destination.
3. Budget-conscious retirees will need to live outside of the city.
The housing costs in Costa Rica are highly variable. Several factors, including the actual city, it’s size, and the geographic location in the country all impact your rental costs for an apartment when you retire. If you want to live near the city center, then expect to pay about $1,000 per month for the privilege and some space. If you don’t mind downsizing, then a one-bedroom space is about $500. When you get outside of the city, then your rates drop by 20%. Expect to pay another $75 per month for your utilities and the same for unlimited Internet service.
4. Crime levels may be higher than what you are used to experiencing.
The levels of crime in Costa Rica are starting to rise, but the rates are comparable to what you would experience in other Latin American countries. You will need to take into account how much money you take with you each day, the way you dress, and even the location of your home or apartment to see if you are comfortable with this situation. The immigration system might have you following some specific rules, but it can also be pretty lax. There are people who have overstayed their visa by several years without any follow-up. New laws and regulations are looking to reduce the impact of this disadvantage, but it could be some time before the effects are felt.
5. You will need to consume local goods almost all of the time.
The import costs to bring food items and foreign luxuries into Costa Rica are very high, which means you will be consuming a lot of local goods to avoid customs’ duties if you decide to retire here. You will want to see which local versions help to satisfy whatever cravings that you have. Because of this issue, there are some changes in the culinary scene that might be bothersome to some folks, such as a lack of salad bars or good Mexican food. Once you get settled and used to preparing many of your meals at home, you will discover that this country can be affordable if you’re willing to embrace a new lifestyle.
6. There is the issue with the street dogs that could bother you.
Costa Rica is home to many undernourished and stray street dogs. Many retirees have adopted them because their circumstances are so sad. Many of the canines are friendly and just want a treat, but there is always the threat of an aggressive one nearby as well. You will want to remain on guard when you see a pack of them, and never allow yourself to be backed into a corner. If you show fear, then they’ve won. Some like to howl at night too, which could keep you up frequently depending on where you live in the city.
7. There can be long waits to access care at a public hospital.
Although this disadvantage is not present all of the time, it is a significant concern if you are trying to retire on a budget to Costa Rica. There can be a long wait to receive the attention you need, even if it is an emergency situation. You have the option to access the private-care system and pay for health insurance when living here, but that comes at an additional expense. The care might cost a fraction of what it does in the United States, but you might also discover that trying to see your doctor is an all-day event.
8. If you don’t like the rain, then don’t come to Costa Rica in October.
When you want to retire to Costa Rica, then you’re probably dreaming of sunshine, beaches, mountains, and relaxation. Although those elements are present throughout much of the year, October is an entirely different story. The rainy season in its entirety can be a little problematic in some cities where the infrastructure lags behind a little. When October comes around each year, it might be a better choice to fly back to see the family instead. You are invariably going to get soaked.
9. Riding a bicycle in Costa Rica can be challenging with the traffic.
The city traffic in Costa Rica can sometimes be exceptionally bad. Downtown city boulevards that are five lanes across can sometimes be bumper-to-bumper throughout the day. If you live in one of the country’s urban centers, then you may want to start walking to where you need to go or begin taking public transportation. You will spend a lot of time in traffic otherwise.
Why not take a bicycle instead? Because there are only a handful of bike lanes available to cyclists throughout the country. Although the government is making it a priority to install safe spots to pedal, the infrastructure is seriously lacking in this area right now.
Retiring to Costa Rica has several pros and cons to consider that are unique to every situation. Can you manage having an extended distance between you and your family and friends? Are you able to manage the sub-tropical temperatures that are present in this Central American nation which are everywhere except the higher altitudes? There are many similarities to the infrastructure of this country, but there are unique cultural differences to consider too. That is why an extended vacation here before you retire is usually the best course of action to take.
Blog Post Author Credentials
Louise Gaille is the author of this post. She received her B.A. in Economics from the University of Washington. In addition to being a seasoned writer, Louise has almost a decade of experience in Banking and Finance. If you have any suggestions on how to make this post better, then go here to contact our team.