Living in Costa Rica: cost of living and safety in the country
Who among us has never dreamed of opening the famous kiosk on the beaches of the Central American nation? Living in Costa Rica is probably one of the greatest aspirations of so many people, and judging by the data, a good portion of the Costa Rican population is indeed foreign.
During our trip to Costa Rica we met many travelers or retirees who have decided to move to the Caribbean coast on a permanent basis.
This is because the opportunities are many and because, contrary to what you might think, living in Costa Rica is quite safe.
In this article we will look at what it takes to live in Costa Rica and what the main factors are before making a decision that would change your life in any case.
It is important, for example, to take into consideration quite different factors than when visiting Costa Rica as a tourist, as aspects such aseducation, health care, taxes and much more come into play.
Read on if that is exactly what you want to know.
Living in Costa Rica: premises
Going to live in a foreign country is not difficult: you just have to decide it.
What remains difficult, however, is to make the right assessments from miles away, because without experiencing the territory, you run the risk of running into quite a few problems.
So what is the first piece of advice we feel like giving you?
A trip to Costa Rica! You got it right, if you have never been there, it is appropriate to plan a reconnaissance trip of at least three weeks and try to experience Costa Rican life.
This is the first step to take, because it is unthinkable to believe that you will buy a house in Costa Rica if you have not first evaluated hundreds of aspects.
You could also opt for a 14-day itinerary if you do not have three weeks to spare, perhaps for business reasons.
Travel and note.
Jot down anything that might catch your eye, not just house prices or food expenses.
Double-check business hours, local customs, and the displacement of necessary services.
For example, it is not desirable to live in Costa Rica without having a vehicle, although you may well decide to reside in the same village all the time with a very convenient bicycle.
However, Costa Rica’s population centers are far apart and sometimes have no small amount of sloping and uneven roads.
These are things we will look at specifically in later chapters, but you need to analyze precisely how many schools there are (if you have children), hospitals, medical centers, police headquarters, supermarkets, and even the tides if your intent is to get a beach house.
You’ll also need to figure out what might bother the locals and what might not, what kind of wildlife you might encounter, and what dangers you might face.
Mosquitoes in Costa Rica are not the same as you might encounter in Italy or France-there is a lot to know before taking such an important step.
Now, however, let’s go into detail.
Living in Costa Rica: how much does the housing market cost
It would be very easy to go to Google and look up what the real estate market situation is like to move to Costa Rica.
On the other hand, if you’re here it’s really because of Google, probably.
However, the Costa Rican market can vary from one moment to the next as far as brick is concerned, and we, fortunately, can give you an idea of what we saw during our stay.
Don’t think it hasn’t popped into our heads to buy a house in Costa Rica.
The supply varies from area to area, but we will take Puerto Viejo (Caribbean Coast) as an example, because it has various types of housing: from villas to building plots.
A building plot of land of about 1000sqm can cost about $45,000, to which, of course, construction costs, utility connections and many other costs will have to be added.
In any case, this option has been chosen by many foreigners who have decided to open businesses such as rentals on Airbnb, Booking and whatnot.
An already built house of 170 square meters, on a plot of 700, can cost around $350,000.
Compared to the costs of the European real estate market undoubtedly we are facing affordable solutions, considering that we are talking about tourist areas and practically beachfront.
These costs clearly come down if you opt for a less touristy area.
In any case, we can estimate that the cost per square meter for a building plot is between $50 and $100 square meters .
As far as existing buildings are concerned, if we assume a purchase in Playa Negra we can estimate around $1,000 per square meter, taking into consideration that almost all houses have ample surrounding land.
Compared to buying and selling, rents in Costa Rica are higher and more or less in line with the European market, although slightly lower.
Again, the area will make a difference, but in general a house with 2 bedrooms, kitchen and 2 bathrooms can cost about $1200 per month, including the garden.
Living in Costa Rica: how much does it cost to open a business
Defining how much a business costs to live in Costa Rica is not a simple matter.
In fact, many cost items are quite variable, but what we can do is to point you to whom you can turn for the possible opening of a business, as well as the known fixed costs.
Company registration and incorporation costs
Cost of business registration – Registering a business with the National Registry can cost between $100 and $500, depending on the complexity of the business structure and legal services used.
Notary Cost: Drafting legal documents such as corporate bylaws requires the services of a notary public.
These costs can vary significantly, but generally hover around $400-$1000.
Business licenses
Licenses vary depending on the type of business and the municipality.
Some specific permits may be required, the costs of which can range from a few hundred to thousands of dollars.
Cost of venue
Rent: The rent for a commercial space will depend heavily on the location and size of the space.
Rents in tourist areas or major urban centers can be quite high.
Let’s say a 70-square-meter store can cost $1,000 per month.
Purchase: Buying real estate can require a substantial investment, depending on the location and size of the property.
Banking costs
Opening a business bank account often requires an initial deposit that varies depending on the bank.
Some administrative costs may also be associated with managing the account.
Start-up costs
These may include the purchase of equipment,furnishing the business premises, and initial expenses for marketing and promotion.
Monthly operating costs
They include employee salaries, utilities such as electricity and water, internet, maintenance and other recurring expenses.
You have to consider the cost of corporate taxation and employee social security contributions, which in Costa Rica are significant and include several expense items.
The best advice we can give you, however, when you go to Costa Rica, is to reach out to a local entity that can guide you in opening a business. Make contact with locals.
Living in Costa Rica: cost of living, taxes, services, education and health care
You cannot think of going to live in Costa Rica without considering aspects such as cost of living,education (if you are moving with children) andhealth care.
Well, these last two items in the last century have been particularly boosted by the government, precisely because of theabolition of the esericito, whose funds were diverted to health care and education.
As a tourist, the cost of living is certainly not the lowest, but by going to live in Costa Rica you can certainly find places where a tomato does not cost nearly two dollars.
In the less inflated areas, it cannot be said that food expenses are high, it is true that if your intention is to relocate you will presumably opt for a tourist location, which is at least beautiful and, consequently, more expensive.
Let’s go into more detail.
Cost of living in Costa Rica
You need to make a distinction right away, because the cost of living in Costa Rica will undoubtedly vary based on your needs and, more importantly, the area will affect you greatly.
As we mentioned in our guide to Costa Rica, the cost of food is at least in line with European prices, if not higher.
Considering that this is just one of the cost items to keep in mind when moving to this fantastic country, an accurate calculation is a must: avoid jumping through hoops.
If we take an average Costa Rican salary (about 900 euros) as an example, we can imagine right away that we are not talking about a Third World state, far from it.
The costs of a family to be taken into account are at least to be attributed to these items:
- Food – Groceries will affect the family budget in no small way.
A kilo of bread in Costa Rica costs about $5, while 1L of milk stands at about $1.90 and 6 eggs are priced at about $1.60.
The amounts then are not that far from what you can find in Italy, or Europe, so consider a food budget roughly similar to what you employ in Italy or other similar countries.
If, on the other hand, we consider restaurant meals or take-out, for an inexpensive meal we do not go below $10 per person: the argument does not change if we refer to fast food such as McDonalds and the like. - Rents – Rents are somewhat lower than the European averages and range from $500 for a studio apartment, to $1000 for a 3-bedroom house.
Again clearly, the further out of the area you are, the less expensive the monthly rent will be: prices are slightly lower than in Europe, but much will depend on your needs. - Utilities – The costs to be considered for some utilities on the other hand are higher than European standards, in fact an internet connection costs $50 per month.
Other expenses such as electricity and water supply, on the other hand, are lower and, counting for a 90 sq. m . house, should not exceed $80 monthly (including garbage and gas).
Mobile phone prices are around $20 to $25 per month with unlimited data plans and calls. - Miscellaneous – Other major expense items include transportation, gasoline, clothing, and entertainment.
Passes for public buses are higher than in Rome for example, costing $45 (as opposed to $35 in Rome), however cabs are much cheaper and gasoline is significantly cheaper: 1L of super comes in at $1.47.
Designer clothing does not differ from our prices, then of course in the outlets you can find anything at bargain prices, while for entertainment we go from $7 for a movie ticket to 56 euros for a gym membership.
As you can see, the expenses of living in Costa Rica do not differ much from those in the United States or Western Europe.
If you are moving with family, it will be appropriate for you to consider other expenses as well, such as the purchase of a car or the cost of raising any children.
Taxation in Costa Rica
Personal income taxes in Costa Rica are levied on local income, regardless of nationality or state of residence.
This, too, is a must if you really intend to go and live in Costa Rica; it doesn’t even need to be stressed.
For persons domiciled in Costa Rica, any income earned within Costa Rican borders is considered Costa Rican source income and is subject to taxation.
Costa Rican origin income includes any income derived from goods used, goods located or services rendered in Costa Rican territory.
Non-residents are subject only to relevant withholding taxes (WHT), depending on the nature of local income.
Personal Income Tax Rates.
Self-employed Workers The tax rates for self-employed workers for the 2019 tax year, based on annual taxable income, are as follows:
Annual income brackets 0 to $7984.84:
0% From $7984.84 to $11924.75:
10% From $11924.75 to $19888.58:
15% From $19888.58 to $39861.20:
20% Over $39861.20: 25%
Employees The tax rates for employees, based on monthly salary, are as follows.
Individuals who are both self-employed and employees are not eligible for the full deduction of CRC 3,723,000.
Instead, they will only be eligible for the apportionment of this amount and the amounts resulting from the exempt brackets of income derived from employee services.
Monthly income brackets
0 to $1797.12:
0% From $1797.12 to $2637.42:
10% From $2637.42 to $4627.43:
15% From $4627.43 to $9252.95:
20% Over $9252.95: 25%
Keep in mind that income tax brackets for the self-employed and employees are updated annually.
Interest:
15% Dividends
15% Directors’ fees and the like:
15% Salaries to non-residents:
10% Professional fees:
25% Other: from
5.5% to 30%
No province or municipality imposes income taxes on individuals within their jurisdiction.
Education in Costa Rica
The data oneducation in Costa Rica speak for themselves; in fact, the Central American state enjoys a literacy rate of close to 93 percent, with all due consideration given to the facilities per se.
On the one hand,compulsory education (since 1896) has made great strides in literacy, but on the other hand the facilities for it do not enjoy a great reputation.
Mind you, there is a school in every corner of the country, but what most implanted citizens have noticed is the poor preparation of teachers.
However, at the recreational level, preschools provide numerous occupations, although there is a scarcity of after-school employment as we are used to in Europe.
Let us go into a little more detail and briefly look at how the school system works in Costa Rica, which is divided into four cycles:
- Preschool education – Divided into two main cycles, the preschool cycle mainly welcomes children as young as 4 years old who will take part in kindergarten and then the transition cycle.
Basically, basic notions are taught and music and art subjects are included from an early age. - General Basic Education – This is divided into three levels (primary, intermediate and higher) and embraces students from age 6 to 14.
It is basically the cycle that precedes what is commonly called high school in Italy. - Secondary education – All students from the age of 15 enter thesecondary education cycle, which in turn is divided into two cycles: an upper cycle and a diversified cycle.
During the latter cycle, pupils can choose whether to head for the academic, technical or artistic division.
Vocational or hotel technical schools are also included in this stage. - Higher education – In fact, this cycle is to be approached from university and is divided into three levels: bachelor’ s degree (pre-degree), second level (degree) and third level (post-degree).
Although public education is free, it still carries some cost as in Italy, however, there is also a wide choice of private schools in Costa Rica.
Generally, private institutions charge an annual fee of between $400 .00 and $500.00, in addition to a monthly tuition of the same amount.
Private schools guarantee (at least usually) interdisciplinary and extracurricular activities.
Health care in Costa Rica
Health is one of the focal points the government has been fighting for since 1948.
Health care in Costa Rica is free, and to date life expectancy for citizens stands at 81 years, much to the credit of the 2006 Salas reform.
The measure calls for the employment of figures called Atap, who are effectively equivalent to itinerant doctors (although they are technical assistants), able to move quickly throughout the country.
In addition to more-than-decent public hospitals then, citizens can enjoy home medical care based on health conditions, and even those in good health are entitled to at least one home visit.
Costa Rica ‘s health care system is thus directed to the community in all respects, and during the Covid period, the activities of the Ataps were of paramount importance.
There is no shortage of private facilities, however, which, as obvious, have rather steep costs.
During our trip to Costa Rica we pleasantly noticed medical centers and clinics even in the most remote areas, so in that respect you can find guarantees.
To benefit from the national health care system when you go to live in Costa Rica, you must necessarily be a Costa Rican resident, except in emergencies where anyone can go to local emergency rooms.
How to obtain residency in Costa Rica
One of the most complicated (and also most tedious) aspects of a permanent move abroad is definitely the rather lengthy process of obtaining residency.
In this section we will try to briefly explain how to obtain residency in Costa Rica, whether you are a retiree or a so-called digital nomad.
Keep in mind that before obtaining permanent residency, in most cases, you will have to apply for temporary residency of 3 years.
Since we have compiled a very detailed guide on this, we refer you directly to it.
Needless to dwell on it here, but know that this is an essential aspect to study before going to live in Costa Rica.
