Cost of living
How Panama compares to the US
🇺🇸 Houston, Texas (couple)
2BR rent$1,800/mo
Groceries$550/mo
Dining out$450/mo
Utilities$180/mo
Health insurance$750/mo
Total~$3,730/mo
🇵🇦 Panama City, Panama (couple)
2BR rent$900/mo
Groceries$300/mo
Dining out$250/mo
Utilities$100/mo
Health insurance$150/mo
Total~$1,700/mo
Cost estimates based on Numbeo March 2026 data. Illustrative only — your actual costs will vary by neighbourhood and lifestyle.
Visa for Americans
The main visa pathway for American retirees
Panama
Pensionado Visa
Min. pension income
$1,000/mo
Age requirement
None — pension income is the key requirement
PR pathway
Immediate — Pensionado is permanent residency
Discounts included
Up to 50% on hotels, restaurants, healthcare
Apply where
Immigration in Panama
Panama's Pensionado visa is one of the world's most generous retirement visa programmes — it grants immediate permanent residency and includes significant discounts. Social Security income qualifies. Requirements subject to change.
Other visa options: The Friendly Nations Visa is available to citizens of 50+ countries including the US and grants permanent residency through economic ties or professional employment in Panama.
US Tax for Americans in Panama
Understanding your US tax obligations
US still taxes you on worldwide income?Yes — always
US-Panama tax treatyNo — no treaty exists
FEIE eligibilityYes — earned income only
Foreign Tax CreditLimited — no treaty base
FBAR required?Yes — if foreign accounts exceed $10,000 aggregate
Panama territorial taxPanama only taxes Panama-source income. US pensions, SS, and foreign investment income are NOT taxed by Panama.
Panama's territorial tax system is highly favourable for American retirees: Panama does not tax foreign-source income. Your US Social Security, pension, IRA withdrawals, and US investment income are not subject to Panamanian income tax. The US dollar also eliminates currency risk. This combination makes Panama one of the most straightforward tax situations for American retirees among popular destinations.
This is general educational information, not tax advice. Always verify with a qualified US expat tax professional. ExpatAce is not a tax practice.
Safety & healthcare
Safety and healthcare for American expats
Safety
GPI Rank #67
Panama ranks mid-table on the GPI. Panama City has areas that vary significantly in safety. Most expats live in safe areas like Punta Pacifica, Costa del Este, or El Cangrejo. Research your specific neighbourhood carefully. US State Dept advisory: Level 2 — Exercise Increased Caution.
US State Dept advisory →
Healthcare
🏥 Private recommended
Panama City has excellent private hospitals including Johns Hopkins-affiliated Pacífica Salud. Medical costs are significantly lower than the US. The Pensionado visa includes healthcare discounts.
Medicare abroad: Original Medicare does not cover routine care in Panama. Plan your healthcare transition carefully before you leave the US.
Top cities for Americans
Where Americans are living in Panama
🇵🇦
Panama City (Punta Pacifica / Costa del Este)
From ~$1,800/mo (couple)
ModernInternationalBest healthcare
Panama's modern capital with the best infrastructure, healthcare, and international community. The Punta Pacifica and Costa del Este areas are popular safe expat neighbourhoods.
🇵🇦
Boquete
From ~$1,500/mo (couple)
Cooler mountain townExpat havenCoffee country
A famous expat town in Panama's mountains — cooler climate, strong American community, slower pace. One of Central America's most established expat destinations.
🇵🇦
Coronado / Pacific Beaches
From ~$1,400/mo (couple)
Beach1 hr from Panama CityWeekend destination
Beachside communities 1-2 hours west of Panama City. Popular with weekending Panama City residents and retirees seeking beach living without the capital's costs.
🇵🇦
El Valle de Antón
From ~$1,300/mo (couple)
Volcanic craterCool climateSmall town
A small town set inside an extinct volcanic crater — cool mountain climate, natural beauty, and a small but established expat community.
Get your personalised Panama score
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Cost data: Numbeo March 2026. Safety: GPI 2025. Visa data: Panama Immigration — verify current requirements. Nothing on this page constitutes legal, tax, financial, immigration, or professional advice.
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