Although I had not planned to add a seventh location to my retirement list, the overwhelmingly positive feedback on my Retiring Abroad Series, together with numerous requests to include Portugal, persuaded me to extend my research to one more country.

As with the previous articles, I will evaluate it using the same six criteria. However, I will focus on mainland Portugal rather than the Azores, as the two differ significantly in terms of cost of living. I also recently holidayed on the mainland of Portugal, so I have more insight into the country.

The currency used in Portugal is the euro. The current exchange rate is one US dollar to 0.87 euros. The euro is not pegged to the dollar and that is a floating rate.

1, Cost of living and financial sustainability

Daily expenses (groceries, utilities)

• Utilities: for a typical one- to two-bedroom apartment, combined utilities (electricity, heating/AC, water, gas, refuse) plus basic internet usually average about 150 to 220 euros per month, depending on region, insulation, and usage.

• Groceries: retired couples typically spend around 260 to 450 euros per month on groceries. The higher range is usually in Lisbon or the Algarve, although many people buy fresh produce at outdoor food markets.

Common grocery prices are:

— Bread (0.40 to 0.80 euros) a loaf

— Milk (1.30 euros/litre)

— Chicken breasts (6 to 9 euros/kg)

— Apples (1.20 to 3 euros/kg)

— Eggs (1.80 to 4.00 euros/12)

Housing costs (renting or buying)

Average prices vary a lot by region, but the following ranges work as reasonable assumptions for Portugal as a whole, with Lisbon and central Algarve at the top end and interior cities at the lower end.

Average monthly rent (2025)

One-bedroom apartment (50 sqm): 700 to 1,200 euros

Two-bedroom apartment (80 sqm):1,100 to 1,800 euros

Average purchase price (2025)

Studio (20 — 30 sqm): 150,000 to 220,000 euros

Two-bedroom apartment (80 sqm):240,000 to 500,000 euros

Property taxes

Portugal’s main property tax is IMI, an annual municipal levy of 0.3 per cent to 0.45 per cent on an urban property’s taxable value, varying by location. On purchase, IMT applies progressively up to around 7 per cent to 8 per cent for investment properties, with exemptions for lower value primary homes. High value holdings face extra AIMI surcharges of 0.7 per cent to 1.5 per cent.

Tax environment for residents

Portugal offers special tax regimes for foreign residents, notably a 10 per cent flat rate on eligible foreign pensions and a 20 per cent flat rate on Portuguese-sourced income for qualified professionals. All residents are subject to standard taxes, including progressive income tax (up to 48 per cent) and annual municipal property tax (IMI).

2, Healthcare quality, accessibility, and affordability

Portugal offers high-quality healthcare suitable for retirees, with modern hospitals and English-speaking doctors ranking it among Europe's top systems.

Legal residents, including retirees on D7 visas (Portugal's passive income retirement visa for non-EU retirees) have access to public SNS system with modest fees or free care for seniors over 65 after five years. Prior to those five years retirees of non-EU retirees require private insurance costs 100 to 300 euros/month and is locally available.

Portugal provides public, subsidised long-term care through RNCCI units and charities with wait-lists, alongside private nursing homes and retirement villages costing 1,000 to 2,500 euros per month. Retirees often blend SNS medical coverage with private insurance and self-funding for residential or in-home support, especially in expatriate areas like the Algarve.

3, Climate, environment, and general liveability

Climate

Portugal has a Mediterranean‑Atlantic climate with mild, wet winters and warm to hot summers, especially in the Algarve. Coastal areas such as Lisbon and Porto remain temperate, while inland regions experience more seasonal extremes and occasional summer heatwaves.

Cleanliness of air and water

Air quality is generally good and the tap water is safe to drink, although many residents prefer bottled or filtered water.

Safety and crime levels

Portugal is consistently ranked as one of the safest countries in the world, with low levels of violent crime. Petty crime, such as pickpocketing, can occur in tourist areas and on public transport. In recent years, an influx of migrants has coincided with a slight rise in recorded crime, but overall levels remain low by international standards

Overall pace of life

The overall pace of life is relaxed, with a strong emphasis on family, socialising, and long mealtimes rather than long working hours. Many smaller towns and coastal areas move at a particularly slow rhythm, although Lisbon and Porto feel more cosmopolitan.

4, Visa and legal residency requirements

Retirement visa

Portugal’s main retirement route is the D7 “passive income” visa for non‑EU retirees with steady, non‑salary income such as pensions or investments. It initially provides a two‑year residence permit, followed by a three‑year renewal. After five years of legal residence, you can apply for permanent residence if you meet language and physical‑presence requirements. Long‑term, keeping the D7 depends on maintaining sufficient passive income, health insurance, a clean record, and the required number of days spent in Portugal.

Pathway to citizenship

Most non‑EU retirees start with a residence visa and then maintain legal residence for a qualifying period before applying for citizenship. As of 2025, citizenship can typically be applied for after ten years for most foreigners, and a Portuguese language proficiency test is required.

Property ownership

Foreigners, including non‑EU retirees, can freely buy and own real estate in Portugal; there are no nationality‑based restrictions on residential property. Ownership is usually freehold, recorded at the Land Registry, and you can buy in your own name, jointly with a spouse, or through certain entities, subject to tax considerations.

Estate laws

Portugal applies an EU succession‑law framework for residents that broadly looks to the deceased’s “habitual residence” to determine which national law governs the estate, but allows you to elect the law of your nationality in a will. Without a will, Portuguese forced‑heirship rules can apply, reserving fixed shares of your estate for close family (spouse, children and sometimes parents).

5, Infrastructure, amenities, and ease of integration

Transportation — public and private

In Lisbon, Porto, and many coastal corridors (e.g., Cascais line, Algarve rail), public transport is reliable, frequent, and being upgraded with new metro extensions and electric trains, making car free living realistic in core urban areas. Outside major cities and in smaller towns or inland regions, services thin out and evening or weekend frequencies drop, so most retirees find a car highly convenient or effectively necessary.

Amenities

• Supermarkets: Portugal has full‑service supermarket chains such as Continente, Pingo Doce, Lidl, and Aldi throughout the country; however, fresh open‑air markets remain popular for everyday shopping.

• Shopping and malls: from first-hand experience, Portugal has excellent shopping that is very competitively priced compared with much of Europe, particularly in Lisbon and Porto. By contrast, the Algarve feels more “touristy” when it comes to shopping.

• Social clubs: Portugal, particularly Lisbon and the Algarve, hosts various social clubs that are ideal for expatriates and retirees seeking community and networking. These clubs offer events, dining, and cultural activities.

• Banking: Portugal’s banking system is modern and well-integrated into the EU framework, overseen by Banco de Portugal as the central bank and primary regulator. There are also many international banks with branches in Lisbon.

6, Proximity to family, friends, and travel links

Relocating abroad often means starting with a small social circle, which can be isolating, especially for first-time movers. Since connections are often made through work, retirees must actively “retrain” their approach and make a conscious effort to build a new social network.

Air travel

The main airport in Portugal is Lisbon Humberto Delgado Airport (LIS):

Average flight duration

Middle East & Gulf — 6 hours

Africa — 5 to 8 hours

Europe (including UK) — 2 to 4 hours

Asia (South and North) — 9 to 12 hours (connections)

North America — 6 to 10 hours

South America — 9 to 10 hours (multiple connections)

7, Conclusion

Retiring in Portugal generally suits couples who value climate, lifestyle, and safety more than maximising income or ultra-efficient bureaucracy. It is a good fit for people who enjoy a slower pace, walkable cities or coastal towns, and who are willing to integrate locally and learn some Portuguese, accepting administrative quirks in exchange for good healthcare.

On the other hand, it would not suit couples who have a low tolerance for slow, paper-heavy bureaucracy, language barriers, or a generally relaxed pace of life, and who expect fast, highly structured services instead.

For a couple to live and retire comfortably in Portugal in 2025 while renting, a minimum annual income of around 40,000 to 50,000 euros ($46,900 to $58,600) is a prudent benchmark, although this can vary significantly depending on whether you live in one of the main cities or in a smaller coastal town.

References

Allianz Care (2025). Availa from: https://www.allianzcare.com/en/support/health-and-wellness/national-healthcare-systems/healthcare-in-portugal.html

Deane, C. (2025). Available from: https://www.lumonpay.com/articles/retiring-to-portugal-from-the-uk/

Global Citizens Solutions (2025) Available from: https://www.globalcitizensolutions.com/retire-in-portugal/

Peddicord, K. (2025). Forbes — Available from: https://www.forbes.com/sites/kathleenpeddicord/2025/02/28/everything-to-know-about-retiring-in-portugal/

Titan International Wealth (2025). Available from: https://titanwealthinternational.com/learn/portugal-tax-for-expats/

Unbiased (2024) Unbiased. Available from: https://www.unbiased.com/discover/retirement/retiring-in-portugal-a-complete-guide

• Carla Seely has 25 years of experience in international financial services, wealth management, and insurance. She holds an MSc in Business and Management and multiple professional designations, including ACSI, QAFP, and AINS, along with several investment licences

• For further inquiries or suggested topics, e-mail justaskcarla@outlook.com