HOW TO RETIRE IN COSTA RICA: A Guide to Living Well

Stunning beaches, verdant forests, and many outdoor activities coupled with a relatively low cost of living. These are some of the reasons why many retirees choose to spend the rest of their lives in Costa Rica; a country that is rich in natural beauty and blessed with ecological diversity.

This is part of our Retirement Guides series:
Retire in Portugal
Retire in the Philippines
– Retire in New Zealand

The reason you’ve stumbled upon this blog is probably that you are dreaming to retire in this Central American nation. Fret not, because we’re here to help you make that dream a bit closer to reality by giving you the information you need on how to retire in Costa Rica. Keen to learn more? Read on.

Retirement in Costa Rica
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GETTING A COSTA RICA RETIREMENT VISA

The first thing that you need to secure before retiring to Costa Rica is a residence permit. A residence visa is required from foreigners who wish to live in the country for longer than 90 days regardless of their nationality. You can apply for one at the Costa Rican Department of Immigration (known locally as Dirección General de Migración y Extranjería – don’t look for a website, you won’t find one!) but you’ll need to first secure a provisional visa from the respective Costa Rican consulate in your country.

How do I qualify for residency?

To qualify for a permanent residency in Costa Rica, you must first obtain a temporary resident permit. There are three types of temporary permits issued to foreign nationals:

  • Retiree (pensionado) is for people who receive at least 1000 USD pension per month
  • Rentiers (rentista) is for people who have at least 2500 USD income per month from investments, business, or property and will continue to receive it for the next two years
  • Investors (inversionista) is for people who will invest at least 200,000 USD in Costa Rican real estate, businesses, and others.

If you’ve stayed in Costa Rica for at least 2 years with a temporary resident permit, then you’re eligible to apply for a permanent resident permit. Another way to qualify for permanent residency is if you have a blood-related Costa Rican family member such as your parents, siblings, or child.

How do I become a Costa Rica citizen?

If you want to know how to retire in Costa Rica, then you ought to know how to become a Costa Rican Citizen. Of course, being born in the country is a given. But if you’re born outside Costa Rica, here are the three ways to become acquire a Costa Rican citizenship:

  • By descent: even if you’re not born in Costa Rica and you have at least one Costa Rican parent, it doesn’t matter which country in the world you’re born in, you’re automatically entitled to become a Costa Rican citizenship
  • Naturalization: foreign nationals who are at least 18 years of age and have been a resident of Costa Rica for at least seven years can apply for citizenship. If you’re from Spain or other Latin American countries, you only need to stay in Costa Rica for at least 5 years before becoming eligible for citizenship.
  • By marriage: if you’re married to a Costa Rican, you’re eligible to apply for citizenship after living in the country for at least two years.
HOW TO RETIRE IN COSTA RICA: A Guide to Living Well 1
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Chestnut-mandibled Toucan | Photo by Zdeněk Macháček on Unsplash

In addition, you must be literate in the Spanish language, have no criminal record, and you must present proof of income or a professional career. You also need to demonstrate your understanding of the history of the country by taking an Education Ministry exam or present proof of education in Costa Rica, unless you’re married to a Costa Rican national.

How many expats live in Costa Rica?

Costa Rica is one of the most famous retirement destinations in the world which is why more than 488,900 foreign nationals from all across the globe currently live in Costa Rica, and a huge number of these retirees are from the Americas followed by Europe, Asia, then Africa. This means that you’ll have plenty of opportunities to mingle with fellow expats and a high chance of meeting someone from your own country, too.

WHAT ARE THE BEST AREAS TO RETIRE IN COSTA RICA?

Most Popular: San Jose

Technically speaking, the most popular destination to retire in Costa Rica is also its capital: San Jose. With the many museums and historical sites in the city, you’ll learn so many interesting facts about the history of Costa Rica; two of the most popular museums to visit are the Pre-Columbian Gold Museum and the National Museum.

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While Costa Rica is the capital, many retirees head for less urbanized places | Photo by Robin Canfield on Unsplash

Aside from its historical museums, there are restaurants in every corner of the city which makes it a convenient place to live in. Mercado Central is the place to be if you want to experience the raw urban life in San Jose with the many eateries that serve local delicacies, and shops, where you can buy various local merchandise, such as hand-crafted items, t-shirts, and more.

San Jose is a fine choice. But with that said, more and more retirees are heading away from the city and towards the areas that truly make Costa Rica such a special place.

Up-and-Coming: Montezuma Beach

What started as a simple fishing village is now one of the most frequented tourist spots in Costa Rica: Montezuma. With its long stretch of stunning beaches blessed with fine white sands and a whole lot of other natural wonders, this small town that sits in Puntarenas Province is quickly gaining popularity from travelers all over the world.

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Puntarenas Province | Photo by Arianne Beeche on Unsplash

Though a part of San Jose, San Gerardo de Dota is a town with not so heavy tourism. Nevertheless, it is another place that is quickly becoming recognized in Costa Rica. Also blessed with beaches perfect for surfing, but more famous for over 200 species of birds including tanagers, woodpeckers, hummingbirds, and the mythological resplendent quetzal that can all be seen in Talamanca Cordillera.

Most Underrated: Playa Chiquita

Costa Rica is often praised for its scenic locations, but it still has several places that are yet to be recognized. One such place is Playa Chiquita that sits near the Caribbean coast where you can enjoy a meal or two from its little restaurants, and shop for fresh produce in the farmer’s market, plus, it will give you the luxury of being able to visit the stunning beaches, tropical rainforests, and national parks.

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The Caribbean Coast | Photo by ronald salazar on Unsplash

Another lesser-known town in Costa Rica is Zacero. If you’re fond of scenic routes, lush forests, and other eye candies, then this town is a great retirement spot. It’s known for being a sugar plantation, and one of the major producers of coffee in the country. Also, this part of the country enjoys a much cooler temperature which is perfect for people who can’t stand high temperatures. It is also home to a topiary garden that boasts of its over 120 hedge sculptures shaped in the form of different animals and even humans.

HOW MUCH DOES IT COST TO LIVE IN COSTA RICA?

It’s common knowledge that Costa Rica has one of the lowest costs of day to day living which is probably the reason why you want to know how to retire in Costa Rica. It only takes a long vacation here to appreciate this fact, more so if you are living in the US, Europe, or Australia. But exactly how much budget do you need to live a comfortable life in Costa Rica? Let’s find out below.

Daily cost of living in Costa Rica

Part of knowing how to retire in Costa Rica is knowing how much the average daily cost of living in the country is. According to budgetyourtrip.com, the average daily price based on the expenses of tourists visiting the country is 73 USD. This is much lower compared to the average daily expense in the USA of 224 USD. Of course, different people have different budget styles, so let’s find out roughly how much you’ll need if you’re on a budget, a mid-ranger, or a YOLO believer:

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Photo by Trevor Cole on Unsplash

On a budget

The average daily cost of living for budgetarians in Costa Rica is around 30 USD.

  • Food: if you’ll choose inexpensive eateries over luxurious restaurants, you’ll only need to allot a budget of 7 USD per day which is good for two people
  • Transportation: an average of 4 USD per day is what you’ll need for local transportation, while intercity travel needs a budget of about 6 – 7 USD.
  • Rent: If you choose to rent hostels and other cheap accommodations, you’ll only need to shell out 16 USD per person

Mid-range

At mid-range, a budget of 73 USD is all you’ll need to have a comfortable life in Costa Rica.

  • Food: if you’re dining in local fast-food chains and mid-range restaurants, a budget of 17 per day is all you need
  • Transportation: Riding a taxi will cost you an average of 10 USD per day; going from one city to another will cost about 17 USD per day.
  • Accommodation: mid-range hotels offer a more comfortable stay for a relatively higher price of 41 USD per day

Luxury:

If you want Costa Rica’s high-end experiences, a budget of 189 USD per day is what you’ll need.

  • Food: if you’re choosing fancy restaurants, a budget of 40 USD per day is sufficient.
  • Transportation: allot a budget of 30 USD per day for local transport, while a luxurious intercity trip needs a budget of about 55 USD per day.
  • Accommodation: high-end hotels on average costs around 110/day per person

Buying real estate

One of the reasons why it is a good idea to retire in Costa Rica is that, unlike some other countries, Costa Rica allows foreigners to fully own a real estate property which means that you don’t need to partner up with a local and can straight up buy a property under your name with the exception of beachfront concession properties because a different set of rules apply to these.

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Alajuela | Photo by Fernando Álvarez Rodríguez on Unsplash

Housing costs in the country differ from one city to another. As a general rule, a property in an urban area is more expensive than a property in a rural spot. A beachfront condominium may cost 100,000-130,000 USD or higher.

What are the tax benefits of living in Costa Rica?

Aside from being rich in natural wonders, another thing that makes Costa Rica an attractive country to retire in is the tax advantage. Get this: the only income that is taxable in the country is the income that you earned within the country. In other words, you only need to pay tax if you are employed or have a business in Costa Rica. Employees are subject to up to 15 percent income tax per month, while the self-employed are subject to about 10-25 percent.

This means that you won’t have to pay tax for your business or investments outside the country, which is a good thing especially for freelancers and digital nomads. This also means that you don’t have to pay tax for your monthly pension or social security.

COSTA RICA RETIREMENT COMMUNITIES

Best expat towns for retirees

Tamarindo, a small town named after the tamarind fruit, is one of the most safest expat havens in Costa Rica. It has some of the best beaches in the country, and it houses around 80 restaurants where you can meet and socialize with other expats who chose the town as their retiring place. Tamarindo is quite popular to both casual tourists and retirees, but is also one of the most expensive places in Costa Rica, with a day to day cost of living comparable to the US.

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The Dry Guanacaste Region | Photo by Juliana Barquero on Unsplash

Arenal has a high number of American retirees which makes it another great spot if you love socializing with like-minded people. Plus, it’s rich in natural features such as a lakeside where you can enjoy so many water activities with friends and family, not to mention that it is located next to a rainforest.

Heredia is another city with lush forests, scenic views, friendly locals, and everything else that makes Costa Rica a great place to live in. Though the expat community in this city is not that huge, because of the simple lifestyle and the beautiful environment, it is becoming popular among retirees and it won’t take long before it becomes a one of the top retirement choices in the country.

Assisted living in Costa Rica for expats

Another reason why Costa Rica is one of the best places in the world to retire in is because of the low cost of assisted living. By comparison, assisted living in the US costs anywhere between 1000-5000 USD a month depending on the location, while in Costa Rica, you will only pay half of that figure or even less.

One of the best assisted living communities in the country is the Jose Pujol Marti Retirement Residence, which is supported by the Spanish Cultural Association. Majority of retirees are Spanish, but there are many English-speaking residents, too. The monthly fee is just USD $1,000 USD and it covers meals, rent, housekeeping, laundry, as well as access to the Spanish Country Club. A majority of residents here are independent retirees, but they also offer on-site, or even full-time nursing services. 

LIFESTYLE

Cuisine

I’ll be honest – I don’t think food is Costa Rica’s strongest quality. Don’t get me wrong – there is plenty of fresh fruit available at roadside stalls, in restaurants, and well, pretty much everywhere. But for international jet-setters, Costa Rica’s gastronomy can often leave something to be desired.

While American and European food is widely available in the country, especially in fast food chains and commercial restaurants, part of knowing how to retire in Costa Rica is becoming familiar with the local cuisine. Some of the staple foods here are rice, beans, and lots of fruits and veggies, so if you’re thinking of going vegan or are already one, you’ll find it easy to live here. Meat is also a large part of Costa Rican cuisine.

Because it is a Latin American country, expect a myriad of Spanish food anywhere you go here, such as empanadas, tamales, and so on. Here are some of the traditional Costa Rican cuisines that you should definitely try:

  • Casado: the most common dish in Costa Rica; a combination of rice, beans, bell peppers, onions, tomato, and cabbage, plus the meat of your choice.
  • Gallo Pinto: a staple breakfast food in the country. It’s a mixture of rice and beans served with scrambled eggs, chopped beef, and tortillas
  • Sopa Negra: also known as black bean soup, it is Costa Rica’s version of a chicken soup, which is served to people who are not feeling well. It is served with hard boiled eggs, rice, and tortillas. This dish is best eaten when the weather is cold
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Yes, Pineapples come in red | Photo by Zdeněk Macháček on Unsplash

These are but the tip of the iceberg because Costa Rica still has many food and dishes for you to taste, and you’ll only be able to experience all of them if you choose to live in Costa Rica for a long time.

How to get around

Driving: (aka “The Costa Rican Massage“)

They call driving here “The Costa Rican Massage,” and once you experience the miles of unpaved, bumpy roads, you’ll understand why! The fact is, driving is very difficult in Costa Rica, and can be quite dangerous. Roads are windy, steep, generally not well maintained, and in fact rarely paved. Tread carefully. Very carefully.

Buses are the most common mode of transportation in Costa Rica. If you want an inexpensive fare, go for public buses which are not just cheap but also offer excellent service. If you want a quicker travel time, opting for privately owned shuttles is the way to go, however, it is also pricier. There are also an abundance of taxis in the country, which offers better value for a group of people. Car rental is the most expensive option.

Flying

You can also fly around Costa Rica if you value less travel time and more playtime. The most popular airlines that offer domestic flights here are NatureAir and Sansa. Air travel is the most recommended option if you are thinking of visiting remote regions of the country, because it will only take you less than an hour to get to your destination as compared to riding a bus which can take 4-5 hours.

Is Costa Rica a safe place to live?

One of the most important things to consider when choosing a place to retire in is its safety. Costa Rica, like every country in the world, has its fair share of inconveniences and people with bad intentions. Petty crimes such as theft happen here, but with vigilance and common sense, you can easily avoid them. If you take care of yourself and your belongings just as you would in your home country, then you’ll be safe from harm. Here are some tips to keep you from becoming a victim of crime in Costa Rica:

  • Don’t bring lots of money with you. Bring only what you’ll need.
  • Keep your cellphones, gadgets, and expensive jewelries out of sight from potential robbers.
  • Stay alert when riding a public transportation.
  • If you need to withdraw money, use ATM’s in malls and avoid the ones in the street
  • Do not walk alone at night, and avoid going to dark and less crowded places.
  • Use ride-hailing apps as it is much safer, especially at night.
  • Avoid the poorer neighborhoods because the majority of violence in Costa Rica happen there, like gang wars.
  • Keep a low profile. You don’t want to be a walking target of bad guys.

Health insurance

One of the benefits that Costa Rica is famous for among tourists and retirees is its excellent healthcare system. They have a government-run healthcare system called the Caja Costarricense de Seguro Social (CCSS) and Foreigners who are on a rentista or pensionado residency can join this program for a small monthly fee and avail of free treatment when the need arises.

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Playa Conchal | Photo by Lindsay Loucel on Unsplash

On the other hand, the private healthcare systems have higher fees, but still considerably low as compared with many other countries. If you choose to pay cash, doctors on average charge no more than 60 USD per visit. Surgeries are a quarter or more cheaper than surgeries in the US.

Both public and private healthcare systems in the country are of a top-notch quality in terms of equipment and medical staff training, their processes are still continuously being upgraded. Although the healthcare system here is advanced, you won’t have to pay a fortune just to be treated when you become sick.

REASONS NOT TO RETIRE IN COSTA RICA

Disadvantages of living in Costa Rica

Each country has its own annoyances, and Costa Rica is no exception. Traffic is one of those things that will drain your positive energy here, coupled with roads that don’t have the best quality.

Also, the huge number of stray dogs roaming around the streets of Costa Rica can be really sad to be a part of. Though most of these dogs won’t do you any harm, there’s still a chance of getting attacked by one bad dog. They can also get very noisy at night when they start howling which can be irritating when you’re sleeping.

Language barrier

Generally speaking, there are a lot of English-speakers in Costa Rica. Students learn English from a very young age here, so it won’t be much of a problem. Although there are certain parts in the country where you might have a hard time communicating with the locals. This can easily be solved by learning a few Spanish phrases during your free time. Learning a new language is easier nowadays, thanks to the Internet.

Other things to know before moving to Costa Rica

Ticos (Costa Rican natives), unlike Americans, are more relaxed when doing almost anything. So don’t be surprised if you order food from a restaurant and the staff are taking their time to serve your order. It’s a cultural thing, and it’s called Tico time. Who knows? Maybe you’ll learn to appreciate the small things in life with this relaxed attitude if you learn to shift into this mindset from time to time.

FINAL THOUGHTS

With Costa Rica’s rich biodiversity, stunning scenery, relaxed pace of life, coupled with an excellent healthcare system, friendly locals and fellow expats, the country truly deserves to be one of the best retirement spots in the world. And even if there are minor inconveniences, the good far outweighs the cons.

I hope this article helped you in deciding how to retire in Costa Rica. If you have any questions, or if you have a tip or two for your fellow readers, leave them in the comment section below and let’s learn from each other. Take care!

Retirement in Costa Rica
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Stefan von Imhof is a travel writer and photographer. He loves going off the beaten path, exploring cities by foot and finding under-explored, hidden gems. After living in California for the past 15 years, he and his wife now live in Melbourne, Australia.

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