Cost and quality of living in Portugal

Portugal is one of the top three best places to live, according to Expat Insider 2022.

Moving to Portugal allows cosmopolitans to live in a warm climate by the ocean, travel freely to other EU countries, get a European education, and develop international business.

How to get a Portugal residency with a D7 visa

Obtaining a Portugal residence permit after a D7 visa is one of the popular routes to move to the country legally. In addition, a foreigner has the right to apply for citizenship five years after receiving a residence permit.

The country has favourable conditions for business: many modern companies and educational and technological conferences are held regularly.

According to the QS World University Ranking 2023, four Portuguese universities are in the top 500.

Infrastructure in Portuguese cities is constantly developing. There are good transport links, quality medicine, prestigious universities, museums, parks and restaurants.

However, living in Portugal has its downsides. For example, scorching heat strikes in summer, and there is no central heating not available everywhere to warm residents up in winter; it is mainly installed in new houses. The country also suffers from high unemployment and bureaucracy.

Portugal is one of the cheapest countries for living in the European Union. The Portuguese cost of living is lower than many other European countries, such as Italy, France and Germany.

Monthly expenses in Portugal depend on the region. Lisbon, Porto and Cascais are among the most expensive Portuguese cities.

Renting a one-bedroom apartment in Lisbon costs €700+ per month. Utilities for an 85 m² apartment are €110—120.

Dining out and groceries. In Portugal, visiting restaurants doesn’t cost much more than cooking at home: a dinner for two in a middle-range restaurant costs about €40.

Even the Portuguese themselves frequently eat out. The dish of the day — "prato do dia", an affordable daily option on the menu, is available at many restaurants.

Transportation. A litre of gasoline costs about €2 in Portugal.

Public city transport is provided with buses and trams. The major cities of Lisbon and Porto have a metro:

• in Lisbon, a single metro ticket valid for 60 minutes costs €1.5 and a 24-hour pass costs €6.45+;

• Porto’s metro fees include €1.2 for a single ticket and €4.15+ for a 24-hour pass.

The taximeter in Portugal determines the cost of your trip by taxi. Your final fare will increase in price the further you travel. Credit card payments are typically accepted in taxis. However, it’s best to confirm with the driver before boarding. Normally, a receipt is given to you after the ride.

Tax residents and non-residents pay taxes in Portugal.

Residents live in the country for more than 183 days a year and receive income from work, business or other transactions. Non-residents include foreigners who spend less than 183 days a year in Portugal but at the same time run a business, buy a property or receive other income in the country.

Income tax can be as high as 48% for individuals, depending on the income level. The tax is levied on any income from labour and entrepreneurial activities, including rental.

New Portuguese tax residents who spend at least 183 days a year in Portugal can get a special status — Residente não Habitual. The status is valid for 10 years.

The reduced income tax rates for residents with the RNH status are the following:

• 0% — dividends and interest on deposits from abroad;

• 0% — rental income, royalties and other types of passive income;

• 0% — income from employment in another country;

• 10% — pension received from a foreign country;

• 20% — employment, freelance and commercial activities in Portugal for highly profitable professions.

Account maintenance fees. Opening and using current accounts are usually free in Portuguese banks. But a bank may ask for a minimum deposit of €100—250 to activate the account.

Packaged accounts with extra services are usually paid. The fee depends on a bank policy but usually is between €2.50 to €7.

Service fees for bank cards. Debit cards are usually services free of charge. Credit cards are services with a fee of €0 to €50 a year.

ATM fees. Most Portuguese banks are a part of the national Multibanco system. There is usually no commission when you use a local card to withdraw cash or pay bills using an ATM.

International money transfer. If the transfer amount is less than €50,000, the fee is up to €15. For transfers over €50,000, the fee is €30 or more, depending on the sum. There also might be a currency conversion fee.

Individual cost calculation for the Portugal Passive Income D7 Visa

Get the cost calculation

Portugal ranks 13th in the Euro Health Consumer Index. The rating considers the availability and speed of obtaining medical services, life expectancy and the quality of patient care. According to these indicators, Portugal ranks better than the Czech Republic, the UK, Italy, and Spain.

The Portuguese use the services of public and private medical institutions.

The National Health Service is Servicio Nacional de Saude, or SNS for short. The Ministry of Health is in charge of this system. SNS is designed for Portuguese citizens, including expatriates.

Most services are paid for even in public hospitals. Including, but not limited to:

• a doctor’s consultation — €4 to €7;

• a house call — €10;

• a night in a hospital — €25.

Voluntary health insurance is only one type of insurance. You can take out private health insurance to avoid queues and long waits and access to more specialists.

Insurance is paid monthly, even if the person did not see a doctor during this period. In addition to the monthly insurance fee, the holder must pay for the appointment: €30 to €70, depending on the specialist.

Expenses for medical insurance are an essential part of Portugal’s living costs for foreigners. The price of insurance can be calculated on the websites of insurance companies.

Insurance cost depends on the patient’s age and the number of services in the policy. Insurers of 60 years old will pay twice as much as policyholders in their 30’s — about €100 per month.

Preschool education. In Portugal, kindergartens are for children from 3 months to 5 years old. They are private and public.

Public kindergartens, unlike private ones, require parents to queue in advance. Additional expenses include meals and an after-hours club — €120 per month.

In private English-speaking daycares, parents pay €500—1,500. Groups are smaller in private kindergartens and include no more than 10 children.

Foreigners can send their child to a public kindergarten if they have a Portugal residence permit or citizenship.

School education. Portuguese schools are also divided into public and private.

Public schools are free and conduct studying in Portuguese; you only need to pay for lunches: €30 to €50 per month. Parents can also receive financial assistance to purchase school supplies.

Educational fees in private schools vary from €200 to €10,000 per month. Students learn English, French, German, Portuguese, and other languages.

A child can enter a public school for free if the parents have a residence permit or citizenship. Parents fully pay for private schools, regardless of their official status in the country.

The most famous private schools in Portugal are:

• St Julian’s School;

• Carlucci American International School of Lisbon;

• Colegio do Rosario in Porto.

Higher education. According to QS World University Ranking, four Portuguese universities are included in the 500 best world universities: the University of Lisbon, the University of Porto, the NOVA University of Lisbon, and the University of Coimbra.

Portuguese diplomas are recognised in all EU countries. Some universities have programs developed jointly with British colleagues. Students of these programs receive double diplomas from Portuguese and British universities.

The most famous universities in Portugal are:

1. The University of Lisbon.

2. The University of Porto.

3. The NOVA University of Lisbon.

4. The University of Coimbra.

5. The Catolica Porto Business School.

Free education in a public university is available to foreigners who have residence permits and have lived for more than two years in Portugal. Without a residence permit, you can enter a paid department.

Studying at Portuguese universities is cheaper than at other European universities: €2,500 to €8,000 per year, depending on the institution and program.

Portugal has a relatively high unemployment rate, but there are areas in which it is easier to find a job: cybersecurity, IT, data analysis, tourism, agriculture, and healthcare.

The Randstad agency has compiled a list of the most in-demand professions. The fastest way to find a job with a salary above the average level is in the following specialities:

• a data analyst;

• a CRM manager;

• a product manager;

• a company director;

• a chief sales officer;

• a chief financial officer;

• an SEO expert.

Freelancers can also move to Portugal. They enter the country with a Schengen or resident visa and then register their company with the tax office or work as individual entrepreneurs.

The minimum wage in Portugal is €9,120 per year, more than in Poland, Estonia and Croatia but less than in the UK, France and Germany.

Portugal’s average income is €1,200 per month. Service workers receive an average of €600 per month, while professionals receive up to €3,000.

The average salaries in Portugal are the following:

• programmer — €2,000;

• engineer — €1,800;

• teacher — €1,200;

• office manager — €900;

• courier, driver, waiter — €600.

Portugal is the only European country in the top 10 of the Expat Insider 2022. The country has high Portugal living standards, affordable prices, and ease of relocation.

Here are some benefits of living in Portugal, which expats often name.

Good geographical location. Portugal is on the Atlantic coast. There are many beautiful beaches; you can surf the big waves and even go whale watching by boat. The average air temperature in winter is +15 °C, and in summer, it is +23 °C.

Fresh local food. It is easy to follow the Mediterranean diet in Portugal: there is always fresh fish and lots of local fruits and vegetables.

Rich culture. Portugal is home to many castles, unique cultural sites, and museums. There are 17 UNESCO World Heritage Sites, including the city of Sintra, the country’s oldest university in Coimbra, the Dominican monastery of Batalha, and the laurel forests of Madeira Island.

Comfortable cost of living. In Portugal, the cost of living is lower than in other developed European countries like Germany, Austria, and France.

Safe environment and friendly locals. Portugal is ranked third on the Global Peace Index. Foreigners note the locals’ friendliness.

Favourable conditions for business. Portugal ranks 39th out of 190 and bypasses Poland, Belgium, and the Netherlands in the Doing Business ranking. Startups and co-working centres are actively developing here, and international IT conferences are held, such as Web Summit and Trojan Horse was a Unicorn.

Life in the European Union. Portugal is part of the EU, which means its residents can work, study and travel without visas within the EU and the Schengen area.

A few things can bring discomfort to future cosmopolitans: high temperatures in summer, dampness and humidity in winter, much bureaucracy, and a relaxed rhythm of life are unusual for many expats.

Intense summer heat. It will not seem like a minus for some, but not everyone tolerates heat well. The average summer air temperature can reach +30 °C in Portugal.

Lack of central heating in winter. Like many other European countries, Portugal does not have central heating. Therefore, houses can be damp and cold in winter. People install electric heaters, but electricity in Portugal is expensive. On average, owners of small apartments pay €100 per month for utilities.

The need to learn Portuguese. English is spoken in tourist places in Portugal, but those who decide to move to the country have to learn Portuguese. The language is needed for study, work, and contacting banks, hospitals and other institutions. You can look at this as a plus: learning the language will help you better understand the culture and the local mentality.

Bureaucracy and queues. You can spend several hours in line both in public and private institutions. Usually, you have to collect and fill out many documents. In addition, everything closes quite early in Portugal: banks stop working as early as 3:00 PM, and other institutions close at 6:00 PM.

Cash payments. People pay by card in supermarkets and large museums, but small shops, restaurants and transport often do not accept cards, so you should always have cash.

Relaxed pace of life. Although the steady pace of life like a plus, it has drawbacks. The Portuguese are not distinguished by punctuality and are often very late for friendly and business meetings. Also, this factor contributes to the prosperity of the bureaucracy.

The Portugal D7 Visa Program helps foreigners move to Portugal and get residence permits. It requires €760 income per month for one person, which is comparable to the average cost of living in Portugal.

The monthly cost of living in Portugal varies by region and family composition. The following is a sample monthly budget for a single person or family of three living in a major city like Lisbon or Porto.

€2,286 — monthly expenses for a single person in Portugal, including the following costs:

• rent one-bedroom apartment — €1,100;

• utilities — €100;

• internet — €36;

• private health insurance — €50;

• groceries — €500;

• entertainment — €500.

€6,006 — monthly expenses for a family of two adults and one child, including the following costs:

• rent two-bedroom apartment — €2,200;

• utilities — €120;

• internet — €36;

• kindergarten — €1,000;

• private health insurance — €150;

• groceries — €1,500;

• entertainment — €1,000.