Cost of Living in Panama 

Panama is a very cheap and safe place to retire.  The cost of living is Panama is a fraction of that in the United States.  Many citizens of the US, Europe and Canada retire in Panama and live like a King. 

What would be a meager retirement fund in the US or Europe affords a very high standard of living in Panama. 

Cost of a Maid in Panama 

In fact, it is common practice in Panama to have servants.  A full time house keeper costs only about $200 per month.  A driver costs about $350 per month.  In general make make more money in Panama.  This may not be something to be proud of, but it is true non the less. 

Cost of Food in Panama 

Food is very inexpensive if you buy at the outdoor markets.  A pineapple, for example, costs only 25 cents.  In general your food bill will be 1/4 to 1/5th of what it would be in the US or Canada.  Be careful, though, Panama City has many upscale shopping malls and grocery stores which sell their goods at American prices.  I recommend that you only use these stores to stock up on goods/brands you can't do without.  Then shop in the cheap markets for the rest of your weekly grocery needs.

Cost of Clothing in Panama 

Clothing is also very cheap.  The same story applies.  You can find shops that will sell you clothes at American prices, but if you shop in the outdoor markets you can find clothes at a small fraction of the cost.  For example, name brand shirts like Tommy Hilfiger can be bought for about $6.  These same shirts cost from $50 to $100 in the states depending on the shirt.  In Panama you can generally get clothing for 10% of the American cost if you shop properly.  If you want to shop in air conditioned malls, expect a much higher price.

Cost of Real Estate in Panama 

Real Estate in Panama has skyrocketed over the past few years.  It used to be a deal, but in Panama City, prices are not much cheaper than in the US.  Outside Panama City there are deals, but most people from the US or Canada won't like the style of Panama properties.  I recommend developments geared to American retirees. 

There are developments on the beach like "Malibu" where you can buy a 3000 square foot house for about $200k.  Smaller models (1600 square feet) in the same development cost only $130k .  Malibu, a famous surfing beach in Panama, is located less than an hours drive from Panama City. (Call for details.)