An important factor to keep in mind when deciding to live in Panama is the cost of living there, although this should, of course, only be one factor and not the only reason to decide for or against a life in Panama. Generally, prices in Panama tend to be slightly higher than in other Central American countries such as Nicaragua or Guatemala and are about the same as in neighbouring Costa Rica. Panama is not as cheap as it used to be, and there are some things that are not a lot cheaper than in Europe or North America. However, there are also a few real bargains you can make, and people from North America or Europe will still find a reduction in their cost of living when coming to Panama.
Food and Dining
As explained in the blog about the costs for groceries in Panama, it depends on you and on what you buy how much money you will spend on food. If you buy local food, you pay a lot less than you would in the U.S. or Canada, and you will pay more for brand names you know from back home here in Panama. What strikes the eye is how cheap “bad things” are in Panama, e.g. a can of beer costs only $ 0.50 (in Costa Rica it is at least twice as much!), a bottle of liquor only $ 5.
Due to the comparatively low costs of local produce, meat and fish, dining in Panama City is very affordable. For only $ 3 or even less you can get the typical lunch with your choice of meat, rice, beans and salad in the so called Fondas. For $ 4 you can get a nice breakfast (either typical with tortillas, eggs, beans and cheese, or “gringo” (=U.S.-American) with pancakes, bacon etc.) and for $ 5 to 6 you get a good pizza. For a fine dinner for two (including wine and dessert) expect to pay about $ 40- 50. Fast Food chains have about the same prices as in North America or Europe.
Even though fuel prices in Panama might not be as low as in other Latin American countries, it is affordable. Panama is in the middle range of countries in terms of fuel prices, and fuel is about the same as in the U.S. and cheaper than in Canada and many European countries (e.g. $ 8.50/gallon in Germany).
Transportation is very cheap in Panama City (especially when I think of the $ 3 I have to pay in Cologne, Germany for just one subway ride!). For only $ 2- 4 you can get around in the city by taxi, depending on the destination and time of the day. To get on the bus is even cheaper: You can either ride the “red devils” (the old, painted school buses) for $ 0.25 or the new Metrobuses for $ 0.45.
The fact that health care is a lot cheaper in Panama than in other countries (a doctor’s visit is about $ 25 to $ 50) has a positive effect on health insurance, and local Panama health insurance can cost $ 100 per person per month or less. This, of course, depends on your physical condition. People after age 60 pay more for insurance in Panama, but when compared to the rates in the U.S. or Europe it is still a bargain.
The costs for car insurance depend on the driver, but are about $ 50 per month. My tip is to definitely get car insurance, as traffic in Panama City can get pretty crazy (as well as the drivers!) and as you, as a foreigner, will be pretty much blaimed for any damage, whether you caused it or not!
Utilities and Communication
Electricity in Panama is not overly cheap, eventhough the government subsidises it. However, the amount on your electricity bill depends on your consumption, and if you do not have your air condition running 24/7 you will be more than ok with your expenses for electricity. Cable TV and Internet are about the same price as in the U.S. (about $ 40 to 50 each, depending on the speed etc., it is cheaper if you purchase a package of both, e.g. with Cable Onda).
Manual Labor and Professional Services
In this sector you are most likely to make the big savings. As wages are low in Panama (the minimum wage has recently been risen by 18% to $ 416), services like landscaping, housekeeping, construction and trade, auto repairs etc. are extremely cheap. For only $ 300 per month you can have, as many Panamanians do, a live-in nanny, who takes care of your kids as well as of the household and all tasks connected to it (cleaning, grocery shopping, cooking, laundry etc.). A landscaper will cost you about $ 2.50 per hour.
For only $ 5 you can get a mens hair cut. Women pay slightly more. A manicure in a beauty salon will only cost you $ 5, as well.
Professional Services are also very cheap. Certified translations (with stamp and signature) from English to Spanish and Spanish to English e.g. only cost about $ 10 per page (for more information visit www.dndpanama.com). A one hour consultation with an immigration lawyer will cost you about $ 150 (for more information visit www.lawyers-abogados.net).
Entertainment is also quite cheap in Panama. At the movie theater you pay $ 5, only $ 2 as a retiree. You can get a ticket for a local theater production for about $ 10 to $ 15 (see www.ticketplus.com.pa).
In bars you usually do not have to pay a cover to enter. For a national beer you will pay $ 2-3, for an imported one $ 4.
All in all, life in Panama is a lot cheaper than in most countries in North America and Europe, even though it is not as cheap as it used to be some years ago. As a retiree you will receive discounts almost everywhere, which reduce the cost of living even more. The biggest savings can be made in the service sector, whereas you have to expect to pay the same as you do at home for electricity, TV and internet. For any questions concerning the cost of living in Panama, please leave a comment in the section below.
About The Author
Ines is the Pro-Blogger for Panama City, Panama. Her role is to connect people who are currently living in Panama City, and provide unbiased information for people who are considering Panama as a retirement destination. Learn how YOU can become the Pro-Blogger for YOUR community!