With its sun-drenched coastlines, historic charm, and vibrant culture, Portugal has repeatedly been rated the best European country for Expat retirees. For Americans, the allure isn’t just its picturesque landscapes; it’s also the blend of a laid-back lifestyle with the benefits of European living. There are also big communities of expats from the UK and many other international countries.
However, every paradise has its nuances. While Portugal offers many advantages, some aspects might require some adjustment. In this guide, we’ll delve into the multifaceted experience of retiring in Portugal, highlighting its attractions and the challenges one might face. Whether you’re captivated by the coastal serenity of the Algarve or the bustling energy of Lisbon, we’ll provide you with everything you need to know about what it means to retire in this wonderful nation.
Table of Contents
- The Pros of Retiring in Portugal
- The Cons of Retiring in Portugal
- Essential Considerations for Americans
- Personal Insights and Tips
- How to Retire in Portugal: EU Citizens vs. Non-EU Citizens
- Best Places to Retire in Portugal
- Are you ready to retire in Portugal?
The Pros of Retiring in Portugal
Affordable Cost of Living
Compared to many other European countries, Portugal offers a significantly lower cost of living. This affordability is especially noticeable when compared to the USA. Our Cheapest Country to Live Index has Portugal’s cost of living at just 58% vs the USA (link). For retirees, this means stretching your savings much further. Portugal provides a very comfortable lifestyle, whether dining out, renting a home, or just day-to-day expenses, and all this without breaking the bank. Especially for those on a fixed income, the economic benefits compared to the States or other European countries can be a significant draw.
Great retirement visa options
Portugal’s D7 Retirement Visa is affordable and accessible. The Portugal Golden Visa is another option, although restrictions passed in 2022 on where you can buy a property have made this a more difficult option, it is still possible to obtain.
High-Quality Healthcare and Private health Insurance
One of the standout features of Portugal is its healthcare system. Ranked among the top in the world, it offers both public and private healthcare options. For retirees, this means access to world-class medical services, facilities, and professionals at a fraction of the cost (even with private health insurance cover) they might incur in the US. Additionally, the country’s national health service infrastructure is well-distributed, ensuring that even those in smaller towns have access to quality care.
Stunning Scenery and Climate
Portugal’s natural beauty is undeniable. From the golden beaches of the Algarve to the rolling vineyards of the Douro Valley, the country offers diverse landscapes for any person looking to enjoy the delights of their natural surroundings. Add to this a Mediterranean climate with mild winters and sun-soaked summers, and you have a perfect setting for adventure enthusiasts and those seeking a slower lifestyle.
Rich Culture and History
For history buffs and culture enthusiasts, Portugal is a treasure trove. You’ll find historic sites outside the major cities, from ancient castles to grand cathedrals. The country’s rich maritime history, age-old traditions, and vibrant festivals offer a deep dive into a culture that seamlessly blends its past with the present.
Friendly and Welcoming Locals
Visitors and Expats alike consistently comment on the Portuguese warmth and hospitality. As a retiree, this means an easier transition into local communities and a chance to forge genuine connections. The openness of the locals often makes it easier for Expats to integrate and feel at home. And Portugal is safe and secure, ranking as the 14th safest country in the world according to our index.
Tax Benefits for Retirees
Important Update: António Costa, Portugal’s Prime Minister, unexpectedly revealed during a television interview on October 2, 2023, that the Non-Habitual Resident (NHR) tax program will cease to accept new participants in 2024. This Program is no longer accepting new participants.
Key thing to know:
- Existing participants will keep their NHR status for the entire ten years.
English-speaking capability
Many Portuguese people speak excellent English. As in many places, young people and tourist areas have the highest concentrations. However, you’ll find excellent English in many parts of Portugal.
The EF English Proficiency report ranks Portugal 8th in the world, giving it a Very High rating. Interestingly, this high ranking results from a recent effort to build English capability within the country. In 2014, Portugal was ranked in 21st place with a Moderate rating showing that significant progress has been made in the last decade.
Need Immigration Assistance for Portugal?
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The Cons of Retiring in Portugal
Language Barrier
Despite the large effort placed on increasing the English capability of the country, you will still hit language issues occasionally. From shopping at local markets to dealing with official paperwork, not knowing some of the language can pose challenges for day-to-day tasks. Learning Portuguese, at least at a basic level, will give you a much smoother experience and reduce the time it takes to settle into your new home.
Navigating Bureaucracy
Dealing with administrative tasks in Portugal can sometimes be a test of patience. Whether applying for residency, setting up utilities, or understanding local regulations, the bureaucratic processes can be slow and sometimes confusing. When possible, being able to outsource bureaucratic tasks or information collection can make a big difference to these processes!
Cultural Differences
While the laid-back lifestyle is one of Portugal’s charms, it can also be frustrating. The relaxed approach to time means that things might not always happen promptly. Additionally, certain customs or social norms (like kids out late in restaurants and squares) might differ from what Americans are accustomed to. As such, some of these customs can require some adjustment.
Distance from Loved Ones
While it is still close to the UK and the rest of Europe, for those looking to retire from the US, being an ocean away from family and friends can be challenging. While technology has made staying connected easier, missing out on significant events or just the familiarity of home can be difficult to manage. So, while living in Portugal offers so many benefits for retirees, it’s important to approach the decision with a balanced perspective.
READ ALSO: Essential Tips for Successfully Living in Portugal
Essential Considerations for Americans
Visa and Residency Options
Understanding Portuguese visa and residency options is crucial for Americans wishing to retire in Portugal. The most popular choice is the D7 visa, designed for retirees and those with a stable income. This visa allows individuals to live in Portugal and can lead to permanent residency and even citizenship. Another option is the Golden Visa program, which requires an investment in the country but offers a faster path to residency.
There are many considerations for those looking to move from the USA to Portugal. We have outlined the main points below, but we would encourage you to do as much research and find out as much about where you are choosing to move to as possible. Our detailed guide on Living In Portugal will also give you a great overview of what your life will be like in Portugal, some of the best spots to live in and the overall cost of living in different areas.
Financial Planning
Retiring abroad requires meticulous financial planning. It is essential to understand the cost of living in your chosen location in Portugal, be it Lisbon, Porto, or a quaint village in the Algarve. Consider housing, healthcare costs, services, transportation, and daily expenses. Additionally, understanding how your US-based pensions, Social Security, and other financial assets will work in Portugal is vital.
Finding the Right Location
Portugal is diverse, with bustling cities, serene coastal towns, and tranquil countryside. Each region has its unique charm and lifestyle. Researching and possibly visiting various locations before settling can help you find a place that aligns with your retirement vision.
See our picks in the section below for the best places in Portugal for your retirement.
Integrating into the community
Building connections and integrating into the local community can enhance your retirement experience. Joining Expat groups, participating in local events, and even taking Portuguese language classes can help make friends and feel more at home.
Personal Insights and Tips
In the next section, we’ll delve into personal insights and tips from those who’ve made the leap and are now enjoying their retirement in Portugal. Their experiences, both good and challenging, will provide a firsthand perspective on what life in Portugal truly entails. Ultimately, retiring in a new country is a journey of discoveries, adjustments, and memorable moments. These are just some tips to make the most of this exciting new life journey!
Embrace the Learning Curve
Every new place comes with its own set of challenges. Whether it’s understanding local customs or figuring out public transportation, there’s always something new to learn. Embracing these moments, rather than resisting them, can make the transition smoother and more enjoyable.
Local Markets Are Your Best Friend
One of the joys of living in Portugal is exploring the local markets. Not only do they offer fresh produce, but they’re also a great way to immerse oneself in the local culture and even practice your Portuguese.
Stay Connected with Fellow Expats
While integrating into the local community is essential, connecting with fellow Expats can provide a sense of familiarity. They can offer advice, share their experiences, and even help you navigate your challenges. No matter where you are in the world, having a community around you to support you is one of the most important things you can build.
Explore Beyond the Tourist Spots
While places like Lisbon and Porto are beautiful and worth exploring, Portugal offers so much more than just these big cities. Take weekend trips to lesser-known towns, explore hidden beaches, or attend local festivals. These experiences can provide a deeper understanding and appreciation of the country.
Stay Patient with Bureaucracy
One common challenge many expats face is dealing with Portuguese bureaucracy. While it can be slow and sometimes confusing, staying patient and seeking advice from those who’ve been through it can make the process more manageable.
Invest in Learning the Language
While many Portuguese speak English, especially in urban areas, learning the language can significantly enhance your experience. It not only helps in daily interactions but also shows the locals that you’re making an effort to integrate.
How to Retire in Portugal
The requirements for retiring in Portugal depend on your citizenship. If you have dual citizenship, you can use the nationality most beneficial for your application.
We have written a complete guide on How to Move to Portugal. We’ll cover much more than just immigration permits. You’ll learn to find a place to live, move your things, health, and what you must do when you arrive.
- D7 Passive Income Visa (also known as the Portugal Retirement Visa).
- Portugal’s Golden Visa.
Each has pros and cons, depending on your Portuguese retirement plans.
EU/EEA/Swiss Citizens
Retiring in Portugal is easy for many. Citizens of the European Union (EU), the European Economic Area (EEA), and Switzerland have easy access. You don’t need a visa, but you must register for residency in Portugal.
EU citizens can register in Portugal at any Immigration and Borders Service (SEF) office.
Remember that UK citizens no longer qualify as a result of BREXIT. A UK passport holder must apply for a visa and residence permit (see the non-EU citizen section below).
Non-EU Citizens
If you are a non-EU citizen who wants to retire in Portugal, you must apply for a visa. This includes US citizens and UK citizens (after BREXIT. )
Two visa options are most commonly used for retirement in Portugal.
D7 Visa (Passive Income) to Retire in Portugal
Portugal’s Retirement Visa (D7 passive income visa) is available to non-EU, non-EEA, or non-Swiss citizens who want to live in Portugal. To qualify, you must be able to meet a minimum annual income threshold of €9,120.
The income can be from pension income, trust fund distributions, share dividends, rental income, and other regular investment income.
To apply for the D7 visa, you must submit your application to the Portuguese embassy in your country. You will receive a four-month temporary residence permit and an appointment date with the official immigration service office (SEF.)
At your SEF appointment, you will need:
- Proof of accommodation.
- Proof of health insurance.
- A police check for both in your home country and Portugal.
The D7 visa is valid for two years, and you can then renew the visa every three years.
This visa is perfect if you:
- Have a steady income.
- Are based in Portugal for at least four to six months per year. This can make you a tax resident.
- Want to rent a property.
Find out if Portugal’s D7 Passive Income Visa is perfect for you in our detailed guide. We also look at the Portugal retirement visa (D7) income requirement.
Golden Visa (Investment) to Retire in Portugal
Another option available for Expats who want to retire in Portugal is the Portugal Golden Visa. It is an investment visa for people who want to invest in Portugal’s economy through capital, or business investments.
You can make investments in:
- Capital Investment
- Investment in a Portuguese company
The minimum investment is €250,000 (for specific arts and entertainment investments).
This immigration program is a good option if you:
- Want the flexibility to come and go from Portugal as you please.
Route to citizenship (and a European Union passport)
The D7 and Golden visas can lead to Portuguese citizenship (or permanent residence permits) after five years. There are some steps to take, including passing a Portuguese language test.
Portugal allows dual citizenship, so there’s no need to relinquish your original nationality.
Find out more about how to get Portuguese citizenship and your EU passport in our guide. We cover the language test and other requirements.
Best Places to Retire in Portugal
Retirees choose Portugal because of its pleasant climate, relatively low cost of living, and safety. While there are Expat retirees nationwide, some locations are very popular with international retirees. There are also many different options to either rent or buy properties in Portugal – we cover all of these options and more in our detailed guide on Moving to Portugal. We also have a comprehensive article for Expats Living in Portugal, covering the best places to live in Portugal in depth. However, the options we present below are focused on our knowledge of retiree’s looking for locations in this iconic European country!
Lisbon
Lisbon is the capital city of Portugal. It has many Expat communities, making it an ideal place to build networks of other retirees. Popular tourist spots are plentiful, and its metro system makes traveling within the city easy and affordable. There is an endless list of wonderful restaurants, bars, and leisure facilities and the international scope of the city means it has all the best of modern lifestyle facilities. The city also highlights the best of the Portuguese lifestyle with some of the best food in the country and iconic historical landmarks.
One thing to note when considering Lisbon is that due to its size and international acclaim, the rental costs are higher than other parts of the country.
Cascais
Outside Lisbon, this seaside region is popular with local and Expat retirees alike. Many locals living in Lisbon will also have a second home here. Because of this, property prices can be higher than in other areas, but the facilities, beaches and restaurants are all exceptional.
Porto
Considered Portugal’s second-largest city, Porto has a large Expat community and is rich in culture and entertainment. It is situated in the Northern part of the country on the Douro River. It has tall bridges and sloping streets which give any wanderer stunning views of the whole city and river. Because of this, it received UNESCO Heritage Site status in 1996. Property prices in Porto depend on the location and are lower outside the major city center. The city has a wide variety of properties, from apartments to family homes. Porto also has an international airport with flights to the States, UK and most other international capitals.
Algarve
This southern coastal region in Portugal is a main attraction for Expats. It has splendid beaches, a warm sea, and a mild climate. It has an iconic coastline full of cliffs, caves and stunning sea views. The Algarve also features an abundance of golf courses that attract retirees in particular. While the Algarve has a very classic Portuguese identity, you’ll find more than one English and Irish pub here! Direct flights to the UK and European countries from Faro Airport are also frequent and inexpensive making it a very popular tourist destination.
Alentejo
The Alentejo region of Portugal is vast, a full 33% of the area of mainland Portugal. However, it is home to just 7% of the population. It also has some beautiful natural parks and wide-open spaces. There is less infrastructure, and the area is less popular with retirees looking for active Expat communities. However, it also provides a quieter, more serene side of this busy country!
Braga
Located in northern Portugal, Braga is the country’s oldest city and the third-largest after Lisbon and Porto. Here you can find hundreds of cafés showcasing Portuguese cuisine in city squares and old churches such as the Braga Cathedral. Braga offers a variety of properties, from modern to historic. Prices vary according to location and facilities.
Aveiro
Also known as Portugal’s Venice, Aveiro sits at the center of Portugal. Modernization has changed the city, but it still keeps its traditional flair with its canals, architecture, and moliceiros. It is popular for tourists and Expats alike, making the city an ideal place for settlement.
Madeira
The tranquil islands of Madeira off the coast of Morocco also offer a unique appeal for retirees. It is a ninety-minute flight from mainland Portugal but has a strong cultural link. The weather is excellent, making it a popular winter destination, and living costs are affordable. There are also good facilities, including free healthcare.
The Azores
The Azores is a North Atlantic archipelago of islands. Dramatic landscapes and natural beauty are the big appeals here. They are also a much less busy group of islands as even the biggest city of Ponta Delgada is relatively quiet.
READ ALSO: Moving to Portugal: Your Complete Relocation Guide
Are you ready to retire in Portugal?
Retiring in Portugal is a decision with the promise of sunlit days, a rich tapestry of culture, and the allure of a more relaxed pace of life. The country, with its diverse landscapes from the bustling streets of Lisbon to the serene shores of the Algarve, offers a unique blend of old-world charm and modern comforts.
However, as with any significant life decision, it’s essential to approach it with a balanced perspective. The benefits of a lower cost of living, friendly locals, and a vibrant culture are undeniable. Yet, it’s equally important to acknowledge the challenges, from navigating bureaucracy to bridging language barriers.
If you’d like help, our fantastic Portugal immigration lawyer provides excellent value and first-class service. Have a look at the reviews other clients have left on their service.
For anyone considering this leap, it’s about more than just a change in geography. It’s a journey of discovery, adaptation, and, ultimately, finding a new place to call home. Weigh the pros and cons, seek insights from those who’ve walked this path, and embrace the joys and challenges. Covering those bases means retiring in Portugal will be a fulfilling and enriching experience.
I am a retired professor (and U.S.A. citizen) in the U.S.A. who has a guaranteed monthly pension of U.S.$4,674 until I die. I also receive a monthly U.S. Soc. Security check in the amount of U.S.$2,886. I own a U.S.$250,000 home that is fully paid for and have no debts. I also have an annuity and savings that amount to U.S.$220,000. I’m interested in possibly immigrating to Portugal, and the D7 status might work for me (and my spouse). Depending on Covid pandemic developments, we plan to tour Aveiro, Madeira and the Azores in early 2022. When should I begin the application process for NHR status? I would like to have this 2022 visit included as part of my five years of visits, if possible. What is your advice?
Hi Jack. Processing times for the visa are 4 – 6 months, so I’d suggest meeting soon with our Portugal Legal partner. This will allow you the time to get your visa approved and your SET meeting booked in good time before your Portugal visit. You can book a consultation here. Enjoy the trip – sounds like a fabulous itinerary. All the best, Alastair
Regarding healthcare options- I understand that private insurance is requires of all D7 Visa applicants, but I also see references to D7 holders having access to public healthcare. Can you clarify? And assuming we were to stay in Portugal for the full five years and then become citizens, would we have full access to the public healthcare system? Would we still need to have additional private insurance?
Hi Jeanie. Once your residence is approved you can apply for public health cover. You need private or Expat health cover until then. All the best, Alastair
Is residancy requirement for D7 visa same for the principal applicant as well his/her dependents or dependents have different residency requirements?
Thanks.
Hi NP. Yes, the requirement is the same. All the best, Alastair
We did our initial exploration of Portugal and plan to go back for a month in October. We’re not sure when we will moving since this second trip will help us hone in on where we want to rent for a year. Can we get an NIF number when we go in October? Does it expire at all or have to be used in a certain time period? Thanks so much!
Hi Bea. I asked our Portugal partner and their response is below. If you’d like assistance from our partner, please book an appointment with them here. All the best, Alastair