Portugal recently topped the list as one of the best places to retire. Considered “the Florida of Europe”, many North Americans have flocked to this tiny gem of a country.
Portugal has a pleasant climate, unique culture, and a relaxed way of life that appeals to many new retirees.
But how can you retire in Portugal from Canada? Well, I’ve narrowed down a few of the most important steps you should start with. Check them out.
- Calculate your cost of living and how much you need to retire in Portugal.
- Figure out what kind of visa or residency permit you need.
- Consider where you’ll live.
- Learn about the tax system and how it will affect you.
- Educate yourself on the healthcare system.
How to Start – What You’ll Need
Making the move across the Atlantic is a big deal. A new country and way of life. While it’s exciting, it’s probably a little bit scary too. Before you hop across the pond, here’s what you’ll need to prepare.
- A computer. Get ready to do a ton of research. Not only on the country itself but where you’re going to live. Not only that, but you have to figure out which documents you need, how the healthcare system works, and how much everything will cost.
- A moving company. What do you plan on taking with you? How will you ship it? What happens once it arrives in Portugal? You need to consider all these questions beforehand and find a solution before your moving day comes.
- Apartment/House/Real Estate Agent. Where will you live when you arrive in Portugal? Do you plan to rent until you make the final decision? Investing in a real estate agent is probably a good idea. They can help you learn the lay of the land and give you insight into your new homeland.
Can a Canadian Retire In Portugal?
Yes, Canadians are welcome in Portugal. In fact, many expats now call Portugal their home. With fantastic weather, great food, and inspiring culture, Portugal is becoming a retiree’s paradise.
How To Retire in Portugal
1. How Much Money Do I Need to Retire In Portugal?
Before even considering the move, you should know your numbers. Mainly, what’s the cost of living in Portugal, and how much do you need to survive?
Living in Portugal is cheaper than living in one of Canada’s big cities, so you’ll likely not need as much money. The consensus seems to be that around $1,600 – $2,200 per person per month lets you lead a comfortable lifestyle.
If you choose to live along the coast, expect to pay more since it’s a desirable location.
As with many other countries, if you choose to rent, you’ll find that apartments come already furnished. That’s a huge saving for you since you won’t have to ship all your belongings across the Atlantic.
Other everyday items like groceries are cheaper than their Canadian counterparts, making it a good deal.
2. Figure Out Your Visa or Residency Permit
Portugal made it easy for retirees to obtain residency. The simplicity of the process is probably why many expats find the country so desirable.
To apply, you must first apply and receive a visa, then visit a nearby consulate and fill out an application for residency. You will also need to provide other documents like proof of income, your passport and complete a thorough background check.
Once finished and approved, you will get a temporary residence permit, which you can renew after the first year. Once you’ve had five years of temporary residence, you can then apply for permanent residency status.
There’s also a Golden Visa resident card, which is essentially a fast track to residency. However, you need to fulfill one of the following requirements:
- Purchase real estate that’s at least 500,000 euros.
- Make a capital investment of at least 500,000 euros for qualifying research and development.
- Do a capital transfer of 1.5 million euros or more.
Note that the Golden Visa program has been undergoing significant changes recently. Please see this guide for up-to-date information regarding the program.
3. Consider Where You’ll Live
One of the many benefits of retiring in Portugal is that most locals speak English. This is especially true of the bigger cities and areas along the coast – both popular retirement destinations.
Lauded as one of “the most affordable countries in Western Europe,” deciding where you want to live might be your biggest decision. The Algarve region on the southernmost tip of Portugal is a popular tourist and retirement destination.
With picturesque craggy cliffs, sandy beaches, golf resorts, and high-end cuisine, many retirees flock here to live the good life.
While the Algarve is popular, it’s also more costly than living in the countryside. The same goes for Lisbon and other larger cities throughout the country.
However, while the prices in these areas might be higher than in other less populated regions, it’s still probably cheaper than what you’re used to paying.
Many couples in Portugal can expect to spend 800-1200 Euros per month in rent near the coast and around 600-1000 Euros per month further inland.
Considering where you live depends on your preferences – the activities you enjoy, the weather, and if you’re interested in living among other expats.
4. Learn About the Tax System
Portugal is very welcoming to foreigners, and nowhere is this more prevalent than in its tax code.
Portugal normally taxes all income, including income from jobs, as well as pensions. However, in 2009 Portugal launched a popular program to help expats gain tax benefits.
Can You Retire In Portugal Tax-Free?
It won’t be exactly tax-free, but you likely pay much lower taxes than in Canada. Retirees can apply for the Non-Habitual Residence Program (NHR). You may qualify for this if you haven’t been a tax-paying resident of the country for the past five years.
If you’re approved, your income is taxed at a 10% rate for 10 years. This includes income from investments, jobs, pensions, and capital gains.
5. Learn About Healthcare
The National Healthcare in Portugal provides free healthcare to its citizens. However, anyone that is a non-EU citizen isn’t eligible for free coverage until they become a permanent citizen, usually after five years.
In the meantime, non-EU expats will need their own insurance coverage, something that’s mandatory in Portugal when applying for residency.
After moving to Portugal, they can change their coverage to a private Portuguese plan which is usually cheaper than international coverage.
There’s a high standard for the public health system. The facilities are modern and equipped with updated technology. Most doctors speak English, easing the burden of communication between doctor and patient.
The downside to the public health system is that wait times might be long. There may only be smaller facilities in rural areas, meaning you’ll have to travel for healthcare.
Disadvantages of Retiring In Portugal
While it sounds like an affordable place to spend your golden years, things in Portugal aren’t always sunny – quite literally.
While the southern part of Portugal enjoys warmer weather year-round, there still is winter in the northern part, and it’s rainy.
While that’s probably not a big deal to most Canadians, it can come as a shock if you’re expecting sunny weather year-round.
If you’re attracted to Portugal because of its cost of living, remember other people are too.
Many expats have retired to Lisbon or the Algarve for the same reasons. So while Portugal is experiencing a boom, it might mean you won’t get the quiet retirement you’re seeking.
And while housing and food are relatively low costs compared to other countries, other items are extremely expensive. Electricity, fuel, clothes, and electronics are all priced high.
The bottom line is that you’ll encounter pros and cons no matter where you choose to retire. You just need to have as much information on an area before you go all in and make the move.
Retirement Communities in Portugal
While some retirees prefer the hustle and bustle of city life, others are more inclined to join retirement communities. These communities often cater specifically to expatriates and provide a more structured environment for seniors.
These communities are often built with the needs of retirees in mind. They usually offer facilities such as swimming pools, gyms, clubhouses, and sometimes even healthcare facilities on-site. Plus, living within a community of like-minded individuals means there’s always a social event to look forward to or someone to share a cup of coffee with.
Apart from the comfort and amenities, these retirement communities also offer safety. They often have 24/7 security, ensuring that residents can enjoy their retirement without any worries.
Choosing a retirement community over a standalone house or apartment can also reduce the hassle of maintenance. After all, the idea is to enjoy your golden years, not to spend them fixing leaky taps or mowing the lawn.
Conclusion
Picking up and moving to a new country for retirement is the dream of so many people.
Portugal is one of the most affordable and picturesque areas retirees flock to. With a low cost of living and high quality of life, travelling across the pond for sun and relaxation sounds like a retiree’s ultimate dream.
If you’re still considering other places for retirement, check out these best spots for Canadian retirees.
Some info is incorrect and outdated here. There is now a 10% tax for NHR and the cost of rent is NOT as cheap as you state – not by a long shot. Its about 1000 Euros ($1400 Canadian) in the largest cities (for a decent place), english is not widely spoken outside the larger cities and your Visa section is oversimplified – you need to get a Visa first, then apply for a residency permit once in Portugal.
Hi Cheryl, I’ve been meaning to update this for inflation, and I’ve added some updated figures. If you live in Portugal, I’d love to pick your brain sometime about it! I’ve been thinking of making the move myself. Thanks for the comment.