Can I Afford to Live in . . . (Pick a Country)

What’s the cost of living? Can I afford to live in Country X, or Y or Z?

Lots of folks want to make sure their dollars, pounds, euros or other currency will be enough to support them comfortably after they move abroad. I totally understand, because that was a huge concern for us as well.

Last month, to note the anniversary of my move to Panama, I asked readers to submit questions about their biggest concern about living in another country. I’m gradually working my way through the answers.

Today’s batch has to do with cost of living.

It’s Important to Get the Whole Picture

It’s all very well to read glowing reports about how inexpensive this or that country is, but it doesn’t really give you the whole picture of what it will cost you.

The same is true back home. When I was raising five kids, my expenses for food, clothing, transportation and school supplies were a whole lot more than they are today, no matter where I live. Your idea of slumming it might be someone else’s idea of luxury.

So I can’t possibly tell you whether you will have enough income to live comfortably the kind of life you want for yourself.

Three Reader Questions

Here are three of the questions I received from readers:

1. Is my Social Security check of $1300 enough to live on in Panama?
2. Can I live on my single Social Security check in Las Tablas?
3. Can I live on my pension of almost $5,000/month?

Panama’s a small country, but the choices of where to live range from isolated rural areas where the cost of property and food is low, to Panama City where the cost of living is quite a bit higher. If you prefer the city, expect to pay more — maybe as much as three times more — for basic living expenses as you would in the interior.

But that’s common sense, and true of cities everywhere. It costs a lot more to live in New York City than in Schenectady, more to live in Boston than in Easthampton, Massachusetts, more to live in Tokyo than Okinawa.

What do you like to do? Do you eat dinner out five nights a week? Hire a live-in housekeeper and full-time gardener? Get season tickets for sporting events or the symphony? Your cost of living will be considerably higher than someone who eats out occasionally, does his own housework and goes to an occasional ball game.

Anyway, you get the idea.

Can I live on my single Social Security check in Las Tablas?

Yes. I don’t know how big your check is, but if it’s average ($1,200/mo) or better, you’ll be fine if you’re single. If you’re a couple you’ll probably need to be careful with your spending.

Rent — for a house or apartment generally acceptable to someone from the US or Canada — ranges from about $200-$600 a month. At the low end it will be unfurnished, and you may have to provide your own linea blanca — refrigerator, stove and other appliances.

Is my Social Security check of $1300 enough to live on in Panama?
Probably yes.

$1300 won’t get you very far in Panama City — I’ve seen lots of places where they want that much or more in rent. But in the interior, you can probably manage.

Can I live on my pension of almost $5,000/month?

Absolutely yes — unless you’re looking for a very high level of luxury.

You can check out the budget I published recently showing our actual expenses for living in Las Tablas and use it as a rough guide.

When you’re looking at other people’s budgets, make sure they include the items that are important to you. You’re looking for a comfortable life, the way you want to live it.

photo by stephendepolo on flickr