Retiring in Portugal

A Guide to Spending Your Golden Years on the Iberian Coast

Known for its sun-soaked beaches, delicious food and wine, and a cost of living that’s surprisingly affordable, it’s easy to see why so many dream of retiring in Portugal.

This article walks you through everything you need to know to make that dream a reality, from choosing the perfect place to live and understanding the cost of living to navigating visas, healthcare, and tips for thriving in your new Portuguese life.

The Pros and Cons of Retiring in Portugal

Portugal is a dream retirement destination for many, thanks to its warm climate, scenic landscapes, and high quality of life. However, like any country, it has its advantages and challenges. Here’s what you need to know.

Why Retire in Portugal? The Pros

Portugal offers numerous advantages that make it an appealing destination for retirees. Here are some of the key reasons why so many choose to spend their golden years in this sun-soaked country.

Warm and Inviting Climate

Portugal enjoys a warm, Mediterranean climate that’s ideal for retirees, with an average of 300 days of sunshine per year.

Even in winter, Lisbon gets around 10 hours of daylight, perfect for outdoor activities and enjoying the city.

The southern region offers hot summers and mild winters (60–65℉ / 16–18℃), while the northern region is cooler but still comfortable (50–53℉ / 10–12℃). This makes it easy to choose a climate that suits your retirement lifestyle.

Safe and Peaceful Environment

Portugal is one of the safest countries in the world, making it a top choice for retirees seeking peace of mind.

Ranked 7th on the 2025 Global Peace Index, the country boasts low crime rates, stable governance, and minimal social unrest.

From quiet coastal towns to bustling city centers, retirees can enjoy daily life with confidence, whether walking the streets, exploring local markets, or traveling across the country.

High-Quality Healthcare

The healthcare system in Portugal provides high-quality medical services at an affordable cost, making it a key consideration for retirees planning their move.

For example, prescription and generic drugs are generally about 75% less expensive than in the United States.

The country ranks 20th in the world in the 2025 CEOWORLD Health Care Index, based on key factors such as infrastructure, professional expertise, access to quality medicine, and overall healthcare costs.

Whether retirees seek care at a local clinic or private hospital, they receive timely and reliable treatment, making retiring in Portugal easier and less worrisome. Read on to learn more about healthcare options for retirees in Portugal.

Affordable Cost of Living

Many retirees find Portugal more affordable than the U.S., the U.K., and even neighboring Spain, making it easier to enjoy retirement without financial stress.

According to recent Numbeo data, the overall cost of living in Portugal is about 5.6% lower than in Spain, even though rent in Portugal is on average 6.1% higher.

Portugal is about 40% cheaper than the U.K. and 42.7% lower than the U.S. when excluding rent, while rent alone is around 65% less expensive than in major U.S. cities.

While costs vary by region, retirees can enjoy a comfortable lifestyle while stretching their savings across housing, food, transportation, and leisure. Read on for a breakdown of daily living costs and typical monthly budgets.

Warm and Welcoming People

The Portuguese are known for being warm, friendly, and welcoming to foreigners. Many locals, especially younger generations, speak English, making it easier for retirees to integrate into the community.

Retirees often find themselves quickly accepted, whether chatting with neighbors in a village café, joining local clubs, or participating in cultural events and festivals.

Portugal also has a vibrant expat community, offering opportunities to connect with like-minded individuals, attend organized activities, and receive practical guidance from those already settled in the country.

Diverse Lifestyle Options

Portugal offers a wide variety of living environments to suit every retirement preference. Retirees can enjoy the bustling streets of Lisbon and Porto, the inland medieval villages that provide charm and quiet, or the sunny southern beaches that allow year-round swimming and relaxed seaside living.

With its relaxed pace, scenic landscapes, and abundant cultural opportunities, including local social clubs, volunteer projects, and cultural events, Portugal makes it easy to enjoy your golden years at your own speed while feeling fully connected to the community.

Flexible Retirement Opportunities

Retirees also benefit from flexibility. While the official retirement age is 66 years and 4 months, expats can relocate at any age with the correct visa, making early retirement a real possibility.

The combination of a warm climate, scenic landscapes, and welcoming communities makes Portugal an ideal place to enjoy your golden years.

What Are the Cons of Retiring in Portugal?

While Portugal has many benefits for retirees, it’s also important to be aware of some potential challenges before making the move.

Slow and Complex Bureaucracy

The relaxed pace of Portuguese life extends to government services, which can be slow and sometimes confusing.

Retirees handling residency paperwork, healthcare registration, or other official matters may face long waits and differing information depending on the staff member, so patience is essential.

Emergency Services in Rural Areas

Outside major cities, access to emergency services can be slower, with longer ambulance response times and limited specialized medical support.

Retirees may want to identify the nearest hospital, keep emergency contacts handy, and maintain reliable transportation. Many also opt for private coverage or insurance with rapid-response options to ensure timely care.

Being aware of local clinics, fire services, and police stations helps maintain peace of mind and independence in more remote areas.

Limited Public Transport in Rural Areas

Smaller towns and inland villages often have limited bus or train services, making daily travel less convenient than in major cities.

Retirees living in these areas may need to rely on a car for errands, appointments, and leisure activities, which can increase transportation costs and require adjusting to local driving norms.

Planning for fuel, car insurance, and parking is also vital for maintaining mobility and independence.

Restricted Banking Convenience

While Portugal’s banking system is reliable, expats may find that smaller towns and local markets prefer cash over cards.

Opening a local bank account is usually necessary for bills and pensions, and some international cards may not always work.

Keeping a mix of cash and cards and choosing a bank with English support can make day-to-day transactions easier.

Lack of Central Heating

Most Portuguese homes do not have central heating. Retirees, especially those accustomed to warmer indoor climates, may find northern homes chilly in winter, and higher electricity bills can increase monthly expenses.

Many apartments also lack air conditioning, which can make the hot summer months in the south less comfortable.

In addition, older homes often feature small kitchens with compact stoves and refrigerators, so retirees should keep these factors in mind when choosing a property.

Language Barriers

While many locals, especially younger generations, speak English, retirees aiming to fully integrate into their community or apply for permanent residency or citizenship will benefit from learning basic Portuguese.

Language skills are essential not only for everyday tasks like shopping, banking, and transportation, but also for navigating healthcare, accessing local services, and participating in social, cultural, and volunteer activities.

Visa Options for Retiring in Portugal

Retiring in Portugal requires careful planning, particularly when it comes to obtaining the correct visa and residency status.

The requirements vary depending on whether or not you are an EU citizen, so it’s essential to understand your options before making the move.

EU Citizens

If you are an EU citizen, retiring in Portugal is relatively straightforward. You can live in the country with minimal bureaucracy, registering with the Portuguese Immigration and Borders Service (SEF) to access the same benefits as nationals. This makes it easy to settle, open bank accounts, and access healthcare.

Non-EU Citizens

For retirees from outside the EU, obtaining a retirement visa is the first step. After moving to Portugal on a qualifying visa for five years, you can apply for permanent residency and eventually Portuguese citizenship.

The two most common visa options for retirees are the D7 Visa and the Golden Visa.

D7 Visa

The D7 Visa is designed for retirees with stable passive income or sufficient savings, making it the most common choice for those without significant investments.

Typical eligibility requirements include:

• Proof of stable passive income at or above Portugal’s minimum wage ( at least €920/month for the main applicant in 2026).
• Proof of accommodation in Portugal, either through long-term rental or property ownership.
• Private health insurance that is valid for at least the first year.
• A clean criminal record.
• A Portuguese bank account and evidence of sufficient funds for the first 12 months.

Golden Visa

The Golden Visa allows residency through qualifying investments. Since 2023, real estate and simple bank deposits are no longer options, and the program now focuses on:

• Investing in qualifying Portuguese investment funds or capital transfers.
• Supporting cultural or research projects.
• Creating jobs through business investments.

Golden Visa benefits include the right to live and work in Portugal, visa-free travel across the Schengen Area, and the ability to include family members, such as spouses, dependent children, and, in some cases, parents.

After exploring your visa options and requirements, the next step is to understand the cost of living, taxes, and the step-by-step process for retiring in Portugal.

How to Retire in Portugal: Step-by-Step Process

Once you have chosen the correct visa, retiring in Portugal typically follows a clear sequence of steps. While timelines can vary, most retirees move through the process below:

• Step 1: Choose the Appropriate Visa: Most non-EU retirees apply for either the D7 Visa (passive income) or the Golden Visa (investment-based).
• Step 2: Secure Long-Term Accommodation: You’ll need proof of accommodation, such as a long-term lease or property ownership, to support your residency application.
• Step 3: Obtain a Portuguese Tax Identification Number (NIF): A NIF is required for banking, renting property, and paying taxes.
• Step 4: Open a Portuguese Bank Account: Most visa applications require a local bank account showing sufficient funds.
• Step 5: Apply for Residency: Once approved, you’ll receive a temporary residency permit.
• Step 6: Register for Healthcare: After residency approval, retirees can register with the SNS or maintain private international health insurance.
• Step 7: Renew Residency and Plan Long-Term Status: Residency permits must be renewed before they expire, leading toward permanent residency or citizenship after 5 years.

Housing Options for Retirees

Housing is often the most significant expense for retirees in Portugal, and costs vary widely depending on location, property size, and whether you choose to rent or buy.

Many retirees start by renting, which provides flexibility while exploring different regions, before deciding to purchase a property.

For example, a one-bedroom apartment in Lisbon or Porto can cost around €500–€1,800 per month, while similar rentals in smaller towns or inland regions may cost €250–€650 per month.

Lisbon, Porto, Cascais, and the Algarve typically have the highest rents, whereas inland towns and northern regions offer more affordable options.

For those buying a home, it’s important to consider property taxes, including the annual municipal property tax (IMI) and the property transfer tax (IMT), which vary by location and property value.

Portugal places no restrictions on foreign ownership, making it straightforward for international retirees to purchase and enjoy property in the country.

The Cost of Retiring in Portugal

Beyond housing costs, the cost of retiring in Portugal largely depends on your lifestyle and daily choices.

Factors such as how often you dine out, travel, or participate in leisure activities all influence monthly expenses.

Living costs also vary by location. Larger cities and popular tourist destinations like Lisbon and Porto tend to have higher day-to-day expenses.

By contrast, smaller towns and lesser-known villages are generally more affordable, allowing retirees to maintain a comfortable lifestyle while stretching their budgets further.

Day-to-Day Living Costs

Below is a general estimate of monthly expenses for retirees based on location:

• Retired couple in a smaller town: €1,400–€1,900
• Retired couple in Lisbon or Porto: €1,900–€3,200

Everyday living costs like transportation, food, and leisure remain relatively reasonable compared with many other Western countries.

Portugal’s public transportation system is well-developed and affordable, with monthly passes in major cities often around €30–€45 and single tickets about €1.50–€2.

Groceries in Portugal are generally more affordable than in much of Western Europe, with typical monthly spending for basic supermarket items often falling in the low hundreds of euros per person. Shopping at local markets and buying seasonal produce can also help keep costs down.

Dining out remains budget-friendly: a meal at an inexpensive restaurant typically costs around €10–€15, while a mid-range dinner might cost €20–€35 per person.

Leisure and lifestyle activities also fit well into many retirement budgets. Options like gym memberships, cinema tickets, and cultural events tend to be modestly priced.

There are also abundant low-cost or free outdoor activities, such as hiking and exploring beaches or historic towns, that enrich daily life without a hefty price tag.

Healthcare for Retirees in Portugal

Public healthcare in Portugal is managed by the Serviço Nacional de Saúde (SNS) and funded through taxes, giving all tax-paying residents, including retirees, access to medical services.

EU citizens can also use the S1 form (issued by their home country) to maintain coverage while registering with the SNS.

However, non-EU retirees, including U.S. citizens, must first obtain legal residency and register with the SNS to access public care.

It’s important to note that certain services, such as dental care or cosmetic procedures, are not covered by the public system.

As a result, many retirees choose private health insurance in Portugal to ensure faster access, English-speaking doctors, and greater comfort.

Additionally, the SNS can involve long waits for non-urgent care, especially in urban centers, making private coverage appealing for many retirees.

Taxes Laws for Retirees

Understanding Portugal’s tax laws is essential to planning a smooth retirement abroad.

Individuals become tax residents if they spend more than 183 days in the country each year. As a resident, you must declare all worldwide income, including pensions, investments, and other earnings.

Portugal has agreements with numerous countries, both inside and outside the EU, designed to prevent double taxation.

This means that income, such as pensions, won’t be taxed twice, once in Portugal and again in your home country.

To take full advantage of these treaties, retirees should obtain a Portuguese Tax Identification Number (Número de Identificação Fiscal, or NIF) and consult a tax professional to navigate the system, identify available exemptions, and ensure an efficient tax plan.

Portugal’s Non-Habitual Resident (NHR) Tax Regime

Portugal’s Non-Habitual Resident (NHR) tax regime offers favorable tax treatment for foreign retirees, including reduced taxation on certain pension income.

While some of the original benefits have changed, retirees who qualified under earlier rules may still benefit from transitional provisions.

Retirees should understand how pension income, dividends, and foreign-sourced income are taxed under the current NHR rules and consult a tax professional to ensure compliance and optimize their tax situation.

Inheritance Laws for Retirees

Portugal does not impose inheritance tax on real estate, and close family members, such as spouses, children, and parents, are generally exempt from the standard 10% stamp duty.

For other assets, inheritance rules may depend on the deceased’s home country, though Portuguese law may apply when spouses or heirs are from different nations.

To ensure your estate is managed according to your wishes, it’s essential to have a properly drafted will.

Retirees with assets in multiple countries should consider creating legal documentation in both Portugal and their home country, ideally with the guidance of an experienced estate planning professional.

The Best Places to Retire in Portugal

Portugal offers a wide variety of regions that appeal to retirees, from bustling cities and serene countryside to sunny coastal towns.

Some may prioritize beaches and nature trails, while others prefer art, culture, or historic neighborhoods.

Here are some of the most popular destinations for those considering retiring in Portugal.

The Algarve Region

Portugal’s southernmost region, the Algarve, is one of the country’s most popular retirement destinations and is home to an estimated 100,000 pensioners, many of them British.

The region is celebrated for its fresh seafood, local wines, and mild winters, and it offers hundreds of miles of stunning beaches with crystal-clear waters and around 300 days of sunshine each year.

The capital, Faro, features an international airport, making it easy for foreigners to visit their homes and travel across Europe.

With many expats living throughout the Algarve, including Faro, Lagos, Albufeira, and Tavira, English is commonly spoken on the streets, helping newcomers feel at home.

Lisbon

Located in western Portugal, the country’s capital and largest city is characterized by historic trams, painted tiles, and cobbled streets.

The modernity of the urban city blends seamlessly with the traditional neighborhoods and historic plazas.

Lisbon offers a mixture of urban and natural landscapes. Its high-quality healthcare, public transportation, and cultural diversity pull in art enthusiasts and golfers alike.

However, Lisbon is the most expensive city in the country and is no longer considered affordable by local standards, which is a key consideration for those retiring in Portugal.

It’s currently experiencing a cost-of-living and housing crisis, with skyrocketing prices pushing many locals out.

The Silver Coast

The coastline from Lisbon to Porto is often called the Silver Coast (Costa da Prata). Similar to the Algarve, it is known for its rugged coastline and sunny beaches.

However, you’ll find the area is less developed and crowded than the south. There will be fewer tourists and more local surfers at these beaches.

The Atlantic breeze makes the area cooler than the Algarve, and you can expect wet winters and spring-like summers.

Porto

Porto, the second-largest city in the country, is a UNESCO World Heritage Site. Located on the Douro River in the north, this is the place for food and wine lovers who love cooler weather.

While there is still plenty of sunshine in Porto, you can expect rain during the winter months. Like in Lisbon, retirees will find a rich cultural scene with easy access to nature outside the center.

However, Porto offers a more relaxed and slightly more affordable alternative to the capital, appealing to retirees who prefer a slower pace and a strong sense of local character.

The Islands

Madeira and the Azores are Portugal’s two autonomous regions. They are ideal for retirees looking to escape from it all while still being part of a tight-knit community.

The islands offer a warm subtropical climate and abundant natural beauty, including beaches, forests, and volcanoes.

Madeira sees more tourists than the nine islands of the Azores, though both are accessible to Portugal and the rest of Europe.

However, keep in mind that the cost and effort to get to the mainland can be high – the remoteness is not for everyone!

Other Great Cities for Retiring in Portugal

With so much to offer, it’s hard to narrow down the top five best places to live in Portugal for retirees.

While the above cities have a lot to offer, these other spots are popular with foreigners as well.

Cascais

A coastal town located 25 minutes away from Lisbon’s busy streets by train. It’s great for expats who still want access to city amenities but prefer the laid-back lifestyle of an old fishing village.

The town is known for its beaches and rock formations, as well as outdoor activities such as sailing, golfing, and swimming. You can also find plenty of museums and cultural events.

Aveiro

Often compared to Venice for its network of canals, this west-coast city has a mild climate and is ideal for escaping the hot sun of the south.

Besides its affordability, one of the biggest attractions for retirees to Aveiro is its walkability and the fact that you don’t need a car to get around.

Braga

The third largest city in Portugal and one of its oldest. Braga offers the big-city amenities of Porto and Lisbon without the higher cost of living.

It’s full of entertainment options, from museums to centuries-old churches to music festivals. For nature lovers, it also offers easy access to national parks.

The warm welcome from locals and lower property prices attract retirees from all over the world.

Coimbra

Located on the Mondego River, this is Portugal’s fourth-largest city. It’s a vibrant college town with a rich cultural history.

The University of Coimbra dates back to 1290 and is a UNESCO World Heritage Site. Retirees enjoy the lively atmosphere of the town, full of locals, students, and foreigners.

Museums, restaurants, cultural events, and shopping mean there’s always something to do.

Ready to Make Your Golden Years Shine?

With its sunny climate, affordable cost of living, excellent healthcare, and welcoming communities, Portugal remains one of the most attractive retirement destinations in the world.

Whether you’re drawn to the golden beaches of the Algarve, the cultural energy of Lisbon and Porto, or the charm of smaller historic towns, Portugal offers a retirement lifestyle that balances comfort, adventure, and peace of mind.

Of course, retiring abroad requires careful planning, from choosing the right visa and understanding tax obligations to securing reliable healthcare coverage.

But with the right preparation and expert guidance, retiring in Portugal can be both smooth and deeply rewarding.

Thinking about making the move? Speak with an insurance expert to find global medical coverage that aligns with your retirement plans, budget, and long-term needs, so you can focus on enjoying life on the Iberian coast with confidence.

Frequently Asked Questions