Costa Rica is a popular expat destination due to a variety of appealing factors. These include easy entry requirements, beautiful surroundings, friendly people and low cost (allegedly). We spent two months in Costa Rica and would highly recommend it to anyone seeking an expat living situation. I have done posts recapping our budget and reflections of Costa Rica. Here I want to do something different. I’m going to break down what it would cost to live an expat life in Costa Rica, based on the actual numbers from our trip.
The way I will approach this is to break this into a couple different analyses. One will be a renting scenario, where Airbnb or something like that would be used. The other is buying a property such as a condo. The numbers will be for a family of four since that’s our situation and is what our actual numbers are based on.
Lifestyle
Your lifestyle will be a major factor in your expenses. I wanted to provide a little background on our lifestyle in Costa Rica so there is context to our spending.
Our family is frugal, but not overly so. It might be better to say we are intentional rather than frugal. We will never achieve the levels of frugality I have seen from others pursuing lean fire or poverty fire, but we are more frugal than probably 90% of the population.
Our accommodations are nice in quality but not large. In Costa Rica we squeezed into two bedroom places with a family of four. Some expats pursuing FIRE may wish to push down the quality to make this even cheaper. Others may not be able to stand a two bedroom place with four people. I feel like that puts our numbers somewhere in the middle.
Food spending for us is likely average as well. We don’t eat out very often, maybe a couple times per month. We also don’t consider eating out to be food money, but rather discretionary money. The food we buy is very high quality fresh foods, and we don’t avoid any particular food due to cost. Our focus is on healthy eating with lots of fiber and protein through fresh fruits/vegetables and lean meats. However, at home in the US we still fall under the “thrifty” category of USDA food spending, which is the lowest spending category.
Assumptions
There are several assumptions made in the scenarios presented:
- You are selling everything and moving to Costa Rica. This means no costs to store anything or maintain anything back in your home country.
- You are using international health insurance, something similar to Cigna Global. You may have different more affordable options depending on your immigration status in Costa Rica.
- You will not own a car but use Uber instead. This is by far the frugal option if you don’t have a specific need for a car. We made all local trips farther than walking distance in Uber and it was reliable and extremely affordable. Whatever car you buy, you will not save money over Uber. Any inter-city travel will have to be done via shuttle or small plane, both affordable.
Scenario: Renting Accommodation
There is no guesswork in this scenario since renting a place is exactly what we did in Costa Rica. Below are all of the actual costs that would apply to anyone looking to live in Costa Rica. These costs represent living a portion of the time in La Fortuna and the rest of the time in Jaco.
Starting with the big picture, how much does it cost to live per year, and how much is needed in investments? Knowing the annual costs, we multiply that by 25 to get the investment total needed which allows for a 4% withdrawal rate that covers those expenses.
Big Picture Numbers:
| Monthly Expenses | $3,885.89 |
| Annual Expenses | $46,630.68 |
| Investments Needed | $1,165,767.00 |
Everyone’s situation is slightly different, so I’ll get into the detailed numbers that make up the aggregate costs.
Detailed Monthly Budget:
| Accomodation | $1,698.79 | This got us a very nice 2 bed 2 bath unit in Costa Linda Condominiums that was easy walking distance to the beach. In Fortuna we had a great 2 bed 2 bath house. You can definitely find cheaper lodging by sacrificing quality. |
| Grocery Store | $687.60 | |
| Cigna Global Silver w/ US | $612.18 | |
| Discretionary (i.e. fun & entertainment) | $429.34 | This was our actual spending which included restaurants, alcohol, a couple tours, etc. |
| Clothes | $200.00 | We actually spent no money on clothes but we fund a sinking fund each month. |
| Gifts | $60.00 | |
| Vaccines | $57.66 | This is the price of vaccines after removing Japanese Encephalitis which is unnecessary in Costa Rica. |
| Phone (Google FI) | $52.63 | |
| Transportation | $50.70 | This was the cost of many Uber trips |
| E-Sim | $20.00 | We are using Airalo |
| Virtual Mailbox | $14.00 | We are using postscanmail |
| Cloud Storage | $2.99 | Not everyone will need this. We store pictures and documents in cloud storage. |
Scenario: Buying A Residence
As we were staying in Costa Linda Condominiums, we loved it so much that I decided to research the cost of purchasing a unit similar to the one we were staying in. You can buy one of the better units there for $200,000, and once you do your monthly costs drop dramatically compared to the rent scenario.
Starting with the big picture, we see the much lower monthly expenses and dramatically lower investments needed. The catch of course is that you have to take $200K of your money to buy the condo. However, if you were starting with the roughly $1.2M needed in the rent scenario, you would still end up with $1M after paying for the condo. That easily exceeds the investment total needed to support the ongoing costs.
Big Picture Numbers:
| Monthly Expenses | $2,701.43 |
| Annual Expenses | $32,417.20 |
| Investments Needed | $810,430.00 |
Detailed Monthly Budget:
| Grocery Store | $687.60 | |
| Cigna Global Silver w/ US | $612.18 | |
| Discretionary (i.e. fun & entertainment) | $429.34 | |
| HOA | $225.00 | Includes wifi, trash, pool, 24/7 security, in unit washer/dryer |
| Clothes | $200.00 | |
| Electric | $200.00 | |
| House Escrow (property taxes, insurance) | $83.33 | .25%/year for taxes and for insurance, so ~1K for a 200K place |
| Gifts | $60.00 | |
| Vaccines | $57.66 | |
| Phone (Google FI) | $52.63 | |
| Transportation | $50.70 | Uber |
| Natural Gas | $20.00 | |
| eSIM | $20.00 | |
| Cloud Storage | $2.99 |
Conclusion
For anyone reading this looking to lean FI in Costa Rica, the numbers are probably discouraging. You have to keep in mind that this is for four people. It could be done for closer to $1,500/month for a single person to rent and live in Costa Rica on the cheap. The cost of the two biggest categories, groceries and accommodation, would be far less for one person. I would advise caution on thinking that’s a permanent lifestyle though. You hopefully won’t be the same person in ten years, and things are most likely going to change. You want to be open to the option to get married, have kids, live nicer, etc. When your expenses are already at rock bottom, there’s only one direction for them to change.
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