Thursday, July 29, 2021

Amongst the many factors within a single country that influence the cost of living, your consumption behaviour will contribute significantly. Your personal cost of living is influenced by your chosen standard of living, overall lifestyle and buying habits.

To help you construct a budget for living in Panama, we have researched the typical cost of 10 different categories. Where applicable, we have also included the price ranges of four different locations. The table below each heading will give you a quick reference.  By adjusting each of the 10 sliders, the total budget will respond accordingly:

My Panama budget :


1 Rent


PlaceLower end ($)Higher end ($)
Panama City7502500

There are a large number of variables that influence rent, including size, location, location within that location, furnished or not, type of construction, age of construction, quality of finishes, and many more.

In tourist hotspots such as Bocas, the rent is hugely influenced by the tourist season, in terms of both price and the term available.

Here is an advertisement that recently appeared: “House for rent! 2bedroom/3bathroom house located in Hato Pintado in Panama City. Great location near Metro, Pharmacy, Grocery, and Hospital. Has been renovated with new kitchen, and bathrooms. Private gated driveway, and beautiful yard. $1,300 pm.”  Given everything I have researched in terms of rent, I think this is a very well-priced option.

Another advertisement; this one is for an apartment in David: “Rent apartment with space for living room, kitchen, bathroom, a large room, laundry under roof and a parking lot. Located on the way to the airport after Radio Chiriqui. $250 pm.”

Lease agreements would normally require rent paid in advance, on top of a security deposit equal to at least one month’s rent.

Important: Make sure that your rental agreement is registered with the Ministerio de Vivienda (MIVI for short) and that they hold the deposit, otherwise you might have trouble getting your deposit back, in full and/or in good time.

2 Utilities


PlaceLower end ($)Higher end ($)
Panama City150400
*Based on two people at or near retirement age

Although the price of propane is fairly universal across the country, the price of electricity varies greatly, depending on your location. Smaller rental units, without an air conditioner, will sometimes advertise a rent including electricity. But the quoted rent of larger units, especially when one or more air conditioners are available, mostly exclude electricity.

Stating the obvious, but keep the tropical climate in mind – the use of air conditioners have a significant impact on your utility bill.

3 Health insurance, Healthcare


PlaceLower end ($)Higher end ($)
All cities150550
*Based on two adults aged between 50 and 55

The cost of health insurance is mostly influenced by the ages of the applicant and dependant; the health insurance companies quote premiums in 5-year age brackets. Thereafter, the premium is influenced by the choices in terms of:

  • Health insurance company;
  • Local or international insurance;
  • Level of deductible;
  • Level of co-insurance;
  • Frequency of premium payment.

Tip: see Healthcare for more detail.

Apart from health insurance, you could budget for a routine doctor’s visit of around $30 per person, per month. If chronic medication is required (for example high blood pressure medicine), add another $50 per individual, per month.

4 Connectivity, Mobile service


PlaceLower end ($)Higher end ($)
All cities50150
*Based on two people at or near retirement age, not requiring good connectivity for a mobile business

A pre-paid package deal of $15 with DigiCell, gives the user 2GB data, 10GB social media ‘data’, 150 minutes talk time and 50 SMSs, all valid for 30 days.

Very good connectivity can be arranged for $100 pm, but it’s possible to get by on as little as $40 pm.

5 Insurance (house content, cars)


PlaceLower end ($)Higher end ($)
All cities50200
*Based on two people at or near retirement age

The three variables that will have the biggest effect on the monthly premium are the vehicle’s type, age and location.

6 Transport (public and/or own)


PlaceLower end ($)Higher end ($)
All cities50250
*Based on two people at or near retirement age

This obviously depends on whether you are living in Panama City and commuting to work every day, or living in Bocas and riding your bicycle to the shop!

The price of gasoline (that is fuel or petrol for non-Americans) is $0-81/ℓ in Panama, so you can do a quick estimate if you intend to use your own vehicle(s).

A rechargeable travel pass, for both the Metro and Metro Bus, will get you a one-way ride for $0-25, so with a recharge of $10 you can cover a lot of miles.

An average taxi ride in Panama City is $5 to $10; from Tocumen International Airport to the city centre about $30. Both Uber and Lyft are available.

7 Groceries, Household cleaning


Place & ProductLower end ($)Higher end ($)
Panama City, buying international brands350800
Smaller towns, buying local products300750
*Based on two people at or near retirement age

Two major factors are at play here. The first is Panama City versus the smaller cities or towns further away, with Panama City as a general rule being more expensive. Having said that, some smaller towns (Boquete for example) are experiencing an inflow of expats (driving prices up) while Panama City offers a large variety of stores and supermarket options, which tend to keep prices competitive.

A typical small-town exception is Bocas, where groceries are more expensive than Panama City, since everything needs to be transported over long distances, including a sea passage.

The second factor at play is international brands versus local products. If you are bent on buying everything that you used to buy in the US or Canada, expect to adjust your budget upward, by a lot. Getting used to local brands, and adjusting to local buying habits, can keep your grocery bill manageable.

For a detailed discussion on the food in Panama, you can read this article:  Food In Panama: Eat Like An Expert Expat 

Tip: Although Panama is officially using the metric system, many prices are shown for pounds or gallons. Some items will show both. So be sure to check.

8 Education


Type of schoolLower end ($)Higher end ($)
Panama City, good international school4001500
Smaller towns, good local schools150300
*Based on one child

Private international schools can cost anywhere between $400 and $1500 per month, per child.

Good schools outside Panama City can cost about $150 pm per child, but depending on your desired level of tuition, you might have to invest in extra tuition or private classes in some subjects.

9 Clothing & Footwear


PlaceLower end ($)Higher end ($)
All cities50300
*Based on two people at or near retirement age

Based on average prices available in the larger malls in Panama City, the following items might give you an idea:

  • Women’s full-body bathing suit $30
  • Women’s shorts $25
  • Women’s light summer dress $45
  • Women’s casual sandals $25
  • Women’s/Men’s branded jeans $65
  • Men’s shorts $20
  • Men’s flip-flops $20
  • Men’s running shoes $85
  • Large straw sun hat $35

10 Sport, Recreation, Entertainment


Type of activityLower end ($)Higher end ($)
Golf – monthly membership250350
Golf – play a round50120

Golf club membership in the popular expat area of Coronado is in the region of $15,000, or if you buy a membership, the transfer cost is about $5,000.

Like anything else, the money spent on dining out is determined by personal preference. A couple can certainly enjoy a light meal for $30 or spend a small fortune on pre-dinner cocktails in one of the city’s rooftop restaurants.

Gym membership in Panama City can range between $50 and $75 per month.

Back to budget total

Conclusion: For a long time, Panama was punted as a cheap destination, a retirement haven where low prices will enable the average couple to retire comfortably. Relatively speaking, it might still be the case, but to a lesser degree. In terms of cost of living, Panama is now on par with some US cities, and only slightly cheaper than the US overall.

Make sure to get the free e-book “50+ Things To Consider Before Immigration”.

This will help you to make an informed decision, by prompting the thinking and planning process around immigration.

Travel Hippi, retire early, retire abroad

Complete Guide to Immigration and Residency in Panama