What Expats Will Find Different Living in Panama

Last Updated on August 16, 2025 by Retire in Panama

Having a population of more or less 4 million, Panama is a small country. In the past 20 years, a massive influx of expats, investors, and business people has been helping this country’s development wave. Panama has lost its third-world image and has become a destination for expats. Large expat communities are found here, specifically in Panama City, Coronado, Boquete, and many smaller communities nationwide. Foreigners are attracted to the country due to its modern infrastructure, warm climate, relaxing lifestyle, and stunning tropical environment.

Panama is a beautiful country with its natural biodiversity, offering nature lovers a never-ending display of flora and fauna. You can find miles of sandy beaches on two different coastlines, rolling mountains, hectares of beautiful jungle, and countless islands to discover – you won’t be bored in Panama!

What Makes Panama Different?

Panama differs from other world expat destinations as it features a more solid infrastructure and first-world conveniences – almost close to North America. In terms of value and variety, Panama is unbeatable. So, what makes Panama different from other expat destinations? We have listed some of the top reasons.

Luxury and Modernity

Panama remains a developing country, but it has the fastest thriving economy in Latin America, a stable government, and a currency pegged to the US dollar.

The majority of expats relocating to Panama usually decide to reside in one of Panama’s expat communities. Although, some prefer the laid-back lifestyle of a smaller Panamanian community. There are places where you can see modern high-rise structures, commercial and recreational amenities, exquisite restaurants, and all other infrastructures in a first-world country, along with a tropical backdrop. Or, if you prefer, the quietness of a beach or mountain life.

Live Well For Less

In Panama, the living cost is genuinely affordable. In a few areas of the country, outside of Panama City, a couple could live well on as low as $1,800 per month, including rent. Based on the cost of living website numbeo.com, a three-course meal in a mid-range restaurant for two in Panama City will set you back around $27, and a pint of local beer will cost $2. A movie theater ticket costs $5, and a liter of gas is around 87 cents. The price of imported goods will be more costly than local produce.

Panama – A Friendly Tax System

Panama has a territorial tax system, meaning the government doesn’t impose taxes on income earned outside of Panama. So if you’re a business owner residing in Panama who performs all your business abroad, you won’t need to pay any tax on the income generated from the company. And likewise, if you are receiving a foreign retirement payment, you will not be double taxed. Panama has an excellent infrastructure (fast internet and good telecommunication services), making it possible for businesses to function remotely when residing in Panama.

If you are moving to Panama for tax purposes, please consult with a qualified international accountant.

Excellent Quality Healthcare

It’s a great idea to get private health insurance whenever relocating to Panama – Full coverage private international health insurance will cost around $150 a month for a 50-year-old to $300 a month for someone 65. There are lower cost options for local health insurance also. The facilities from all of the major cities in Panama are excellent, and the price of health care and health insurance is affordable. Also of high quality, it has become a favorite country for expats to live in and retire.

More than in any other location in Latin America, you could easily find English-speaking skilled doctors and dentists in Panama, and the major hospitals have the most recent medical equipment for diagnostics and treatment services.

Expat Friendly Locals

Panamanians are quite warm and friendly towards foreigners, and it will cause you to feel very welcome. The culture is highly casual and hospitable – Panamanians are used to having foreigners around due to the strong US presence during the Canal-building and operation throughout the 1900s and today’s highly diverse cultural landscape.

Excellent Benefits For Resident Retirees

Panama has been rated one of the best countries to retire to by the International Livings Annual Global Retirement Index for many years now, thanks to the Pensionado Program with its numerous discounts. With this program, all you need is a $1,000-a-month pension. You can become a permanent resident of panama and receive discounts like 25% off airfare, meals, entertainment, electrical bills, and much more. To read all about Panama’s Pensionado Visa, go here.

Climate

At sea level, Panama has a warm and tropical climate all year. Go to the mountains, and you’ll experience spring-like weather with much cooler temperatures.

According to where you originate from, you’ll either love or hate Panama’s weather as it could become incredibly hot and humid with temperatures all year round varying between 80-95°F (27-35°C). On the other hand, if you choose the mountains, it could be much cooler than you are used to, with temperatures all year round varying between 60-76°F (15-23°C). There are two seasons – “summer,” which goes from December to April, and “rainy season,” which goes from May to November; you will see rain in the late afternoons 2 – 5 times a week, with October and November being the wettest.

Panama will be different for almost every expat, and how you adjust to this difference is up to you. If you are looking for a retirement destination that is just like you have at home, well, you need to stay at home, as that does not exist. Embrace the differences, and you will love Panama.

 

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