If you’re considering moving to Panama, one of the most important factors to consider is the cost of living. In this article, we’ll take a look at the local currency, compare the cost of living in Panama to the UK and the USA, break down costs for singles, couples, and families of 4 in different categories, and explain the most common forms of payment in Panama.
Local Currency in Panama
The local currency in Panama is the Panamanian balboa (PAB), which is at par with the US dollar. This means that the US dollar is also commonly used as currency in Panama.
Cost of Living in Panama Compared to the UK and USA
According to the Numbeo cost of living index, the cost of living in Panama is generally lower than in the UK and the USA. The index takes into account factors such as housing, food, utilities, transportation, and entertainment.
As of February 2023, the index shows that the cost of living in Panama City is about 48.52% lower than in London and 55.17% lower than in New York. The cost of living in other cities in Panama varies, but generally, the cost of living in Panama is lower than in the UK and the USA.
Breakdown of Costs in Panama
To give you an idea of what you can expect to pay for different expenses in Panama, let’s break down costs for singles, couples, and families of 4 in different categories.
Housing
Housing is one of the biggest expenses in Panama, but it is relatively affordable compared to other countries. The cost of housing varies depending on where you live and the type of housing you choose. According to Numbeo, the average cost of a one-bedroom apartment in the city center is PAB 500 per month. A three-bedroom apartment in the city center costs around PAB 1,000 per month.
If you’re on a tight budget, you may be able to find a room to rent for around PAB 250 per month. However, keep in mind that housing in Panama can be challenging to find, especially if you’re looking for a specific type of accommodation.
Food
The cost of food in Panama is generally lower than in the UK and the USA. You can expect to pay around PAB 4 for a meal at an inexpensive restaurant and around PAB 15 for a meal at a mid-range restaurant.
If you’re on a tight budget, you can save money by shopping at supermarkets and cooking your meals. A week’s worth of groceries for one person costs around PAB 20-25.
Utilities
The cost of utilities in Panama varies depending on the size of your home and your usage. On average, you can expect to pay around PAB 70-100 per month for utilities such as electricity, water, and gas.
Leisure
The cost of leisure activities in Panama varies widely depending on what you enjoy doing. A movie ticket costs around PAB 7, and a fitness club membership costs around PAB 50-60 per month.
If you enjoy going out, expect to pay around PAB 2-3 for a beer in a bar or around PAB 5-10 for a cocktail. Entrance fees for museums and other attractions vary widely but usually range from PAB 3-10.
Transport
The cost of transport in Panama is relatively low, and the country has an efficient public transportation system. A one-way ticket on public transport in Panama City costs PAB 0.35, and a monthly pass costs PAB 15.
If you prefer to drive, you can expect to pay around PAB 0.75 per liter of gasoline. Car insurance is also relatively affordable with an average cost of around PAB 300-500 per year.
Clothing
The cost of clothing in Panama is generally lower than in the UK and the USA. The prices of clothing items depend on the brand and quality of the product. If you’re looking to buy new clothes on a budget, there are several affordable chain stores that offer reasonably priced clothing.
For example, Forever 21 and H&M are popular stores where you can find fashionable clothes at an affordable price. A pair of jeans can cost around PAB 20-30, while a shirt can cost around PAB 10-20.
Household Goods
The cost of household goods in Panama varies depending on the item and brand. For example, a new television can cost anywhere from PAB 200 to PAB 1,000 depending on the size and features. A washing machine can cost around PAB 300-500, while a refrigerator can cost around PAB 500-800.
If you’re on a tight budget, you may be able to find used household goods on websites such as OLX, the Panamanian version of Craigslist. Many people sell their used items at a fraction of the cost of new items.
Forms of Payment in Panama
The most common forms of payment in Panama are cash and credit cards. Most stores and restaurants accept credit cards, especially in larger cities like Panama City.
Contactless payments and mobile payments are not yet widely available in Panama, but they are slowly becoming more popular. Some banks offer mobile payment services, but these services are not yet widely used.
In addition to cash and credit cards, some stores in Panama accept payment through popular mobile apps like Yappy and Tpago.
The cost of living in Panama is generally lower than in the UK and the USA. Housing, food, and leisure activities tend to be more affordable in Panama, while transportation and clothing are comparable in price.
When it comes to payment methods, Panama primarily relies on cash and credit cards, but mobile payment services are slowly gaining popularity.
Before you move to Panama, it’s essential to research the cost of living in your desired location and create a budget that takes into account your income and expenses. By doing so, you can ensure that you can live comfortably in Panama without breaking the bank.