Cost of Living
It surprises many, but often times, Costa Rica may be more expensive than where you are moving from. Here is why you need to research carefully before moving.
- Private health care is much less expensive than the United States and many other countries and is also very good. Health care insurance cost for a entire year in Costa Rica is about the same as it is for a month in the United States. My worldwide coverage policy, considered catastrophic protection, with a $10K deductible is just over $2500 per year. The same policy, through the same provider, quoted in the United Status was $3000 per month. The big difference in Costa Rica is that they do not accept pre-existing conditions and will either deny you coverage or write in exclusions. Paying out of pocket is also much less expensive. Once you become a temporary resident, you will be entered into CAJA, the national health care program. This program provides full coverage, including pre-existing conditions. The costs for CAJA will vary depending on income and expenses but generally will run the average family of two between $50 and $100 per month.
- Prescription medicine from private medical facilities is much more expensive in Costa Rica than in the United States and are often sold by the pill. For example, a 30 day supply of Lipitor is $80 USD. Once you are enrolled in CAJA, medicine is free.
- There is a Value Added Tax (VAT) of 13% on nearly everything purchased and for services rendered. This includes food, vehicles, dining out, labor, etc. Until July 2019, this tax was only on goods purchased but was recently expanded to include labor such as attorney fees, car repair, home maintenance, cable TV, water, electricity, etc. Some food items that are considered a necessity or are produced in Costa Rica are exempt from the tax. Examples of these are rice, beans, papayas, pineapple, coffee and local beer.
- Gas is roughly $4 USD and diesel about $3.30 per gallon and is sold by the liter. Below is a great link to get current gas and diesel prices. Use the pull down menus to select currency and liters versus gallons. Keep in mind that there are 3.785 liters per gallon.
Current Gas Prices
Current Diesel Prices
- There is no such thing as natural gas in Costa Rica. People that have gas appliances such as a stove or outdoor grill use propane. Is is widely available and costs about $11 USD for a five gallon container.
- Owning a car is expensive. There is a yearly registration fee called Marchamo, and is paid in December. It is based on the value of the vehicle, and with car values being very high in Costa Rica, even used cars will have an expensive Marchamo. Our 2014 Toyota RAV4 AWD is valued at about $16,000 USD and our fee was $587. Maintenance can be much more expensive and will vary on the road conditions that you drive on. If you live at the end of a potholed 20 mile dirt road, your maintenance will be far greater because you will be replacing tires and suspension related parts often. Parts are more expensive because they have to be imported but the labor to install is much less. The overall cost to repair something may end up being less, but the frequency will be more often if you drive dirt roads.
- There are also vehicle inspections called Riteve. For cars less than 5 years old, you must have the inspection every 2 years. For vehicles over 5 years, the inspection is every year. The inspection includes all lights, including license plate and backup lights, suspension, brakes (front, rear and parking), odometer, wipers, vehicle fluids including wiper water reservoir, air conditioning, emissions, tire tread and wear, seat belts and general integrity of the body and chassis. The cost for a standard passenger vehicle is about $27. The inspection takes about 30 minutes.
Property and Income Taxes
- If you own land or a home in Costa Rica, property taxes are much less as compared to San Diego. In California, it is not uncommon to pay between $8,000 to $12,000 a year in property taxes for a mid sized, 2,000-2,400 square foot home. In Costa Rica, the base tax rate for most homes and properties is 0.25 percent which equates to $250 USD for a $100K house and $1000 USD for a $400K house. However, there is an additional luxury tax on a home's value (excluding land) over 129M Colones (approx $221K USD) that starts at 0.25%. The luxury tax is bracketed so as the value of your home increases, so does the percentage of the tax. This tax gradually goes up to a maximum of 0.55%. A one million dollar home gets taxed at 0.40%. Please remember that this luxury tax is in addition to the standard 0.25% property tax on home and land.
- If you come here to retire and don't receive any income generated from Costa Rica, you won't have to pay Costa Rican income taxes. An example of this would be receiving Social Security, it is not taxable in Costa Rica.
- Depending on where you are coming from, for us California, you may no longer have to pay state income tax. Every state varies and there are many factors that may result in you continuing to pay state tax such as owning a vacation home or even a timeshare in that state. Consult your attorney to be sure. Even though you move to Costa Rica, you will most likely still have to file your Federal income tax.
- Homeowners insurance is about the same or less for some, than in the United States. It covers earthquakes, volcanic eruptions, floods, hurricanes, landslides, fire and theft. For us, because earthquake protection is included in the standard Costa Rica policy, and California required a separate policy, our overall policy dropped significantly, going from $1800 per year to about $700.
- A good automobile insurance policy runs about $700 per year. Most automatically include roadside assistance.
- Electricity is expensive, similar to San Diego. In hot regions where the AC must be on nearly all the time, it is not unusual is have a bill of $200-300 USD per month. In the Central Valley and surrounding foothills, AC is not needed and monthly electricity costs are very low. Solar is just emerging and not yet widely accepted. Solar is very expensive as compared to the United States because the panels and equipment must be imported.
- Water is inexpensive and generally plentiful. However, because of the hot and dry climate in the Guanacaste province, it is more expensive there and at times there can be water use restrictions.
TV and Internet
- Internet is going to vary, both in quality and cost, depending on where you live. The Playa Flamingo and Brasilito regions have fantastic internet, both in terms of speed and reliability. Fiber has just started coming to the area. Our monthly cost for internet is about $90 USD and allows us to stream movies and shows without any buffering. Once we get fiber this will drop to about $50 USD. In San Diego, our combined TV and internet cost was $240 per month.
- A good satellite TV service will be about $50 USD per month.
- Cell phone plans are incredibly inexpensive with outstanding coverage. Kolbi is perhaps the best provider. My bill in the US was $80 per month. In Costa Rica, using a prepay plan, it has been less than $10. You can save even more if you use WhatsApp to send text and make phone calls back to the US over your WiFi and internet.
Restaurants and Food
- There is an automatic 10% tip (propina) added to eat-in restaurant bills. This is mandatory, even if the service and food are horrible. If the experience was a good one, many people plus up with another 5-10% cash.
- Chicken, fish, eggs, rice, beans, potatoes and locally grown fruits and vegetables are inexpensive. Beef and pork are more expensive but there are some fantastic meat markets that offer much better pricing than local supermarkets. Anything imported from the United States that has a popular brand name is expensive like Jiffy Peanut Butter and Kellogg Raisin Bran.
- Fresh fish is bountiful, inexpensive as compared to the US and Canada, and really fresh. The tuna and mahi-mahi are some of the best in the world.
- Alcohol is expensive, primarily because the majority of it is imported. Locally produced beer is around $10 USD per six pack, although deals can commonly be found. Guaro is probably the most popular locally produced liquor and is made from sugar cane juices that are readily available from the region.
The food prices below are from the Guanacaste area, which is one of the more expensive areas in Costa Rica. Stores include local butchers, fish markets, Maxi-Pali (Walmart owned), Mega-Super and Auto Mercado)
- Chicken, Whole - $1.57/lb
- Chicken, Thighs - $1.45/lb
- Tuna, Can 295g - $1.82
- Mahi Mahi, Fresh - $5.00/lb
- Yellowfin Tuna, Fresh - $5.95/lb
- Red Snapper Fillet, Fresh - $3.65/lb
- Ground Pork - $2.98/lb
- Ribeye - $7.81/lb
- Pineapple, Whole - $0.82
- Cantaloupe - $0.39/lb
- Spinach, Bunch - $0.78
- Brocolli - $1.07/lb
- Cilantro - $0.52
- Garbanzo Beans, Can 576g - $0.96
- Plantain - $0.40
- Potatoes - $0.79/lb
- Coca-Cola, 600 ml - $1.26
- 100% Orange Juice, 61 oz - $4.76
- Local Beer, 6 pack - $10.38
- Almond Milk, 32 oz - $2.37
- Jack Daniel's #7 Black Label, 750ml - $45.91
- Jose Cuervo Reposado Blue Agave, 750ml - $25.44
- Butter, Stick 113.5g - $1.17
- Bread Bimbo, Loaf - $3.46
- M&Ms Plain 10.7 oz - $4.82
- Cheerios 16.9 oz - $4.30
- Aunt Jemima Syrup 24 oz - $4.39
- Heinz Ketchup, 4 pack - $12.19
- Aluminum Foil 12" x 1000 ft - $25.44
- Scott's Toilet Paper 24 pack - $11.75
Cost of Living