How to retire in the sun

Portugal has become an increasingly popular destination for retirees who want to enjoy a new life in the sun. Of course, moving to another country requires good organization and raises some questions, especially when it comes to drawing your pension.

We have therefore summarized everything you need to know about how to retire in Portugal in the following chapters. Please do not hesitate to contact us if you have further questions.

Source: visitportugal.com

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Portugal is not only rich in history and culture, but many regions, such as the Algarve, offers a pleasant climate all year round and affordable living costs. Therefore, Portugal has been ranked number one in the Global Retirement Index for 2020. Another ranking that confirms the high quality of life in Portugal is the Global Peace Index, which voted Portugal in 2019, the third safest country in the world. But not only the mild climate, culture, and security speak for Portugal, but also excellent health care and, last but not least, the tax benefits for your pension that Portugal offers EU citizens for ten years. In the next points, we will tell you which pensions are affected, what you need to consider, and how the system works. In comparison to other European countries, the cost of living in Portugal is around 20% lower. However, it should be noted that the actual costs depend on the respective region and personal living conditions.

In tourist areas, for example, rental prices are much higher during the summer months, since many tourists rent houses and apartments for several weeks to spend the summer in Portugal. You can often observe an increase of around 20%, which only regulates itself after the summer months. So if you plan to move to Portugal, it is advisable to look for a suitable apartment in autumn or winter to avoid increased rental prices. On average, for a one- or a two-room apartment, depending on the location and equipment, you should expect to pay between €500 - €1000. Rents in the city centers of Porto and Lisbon can be higher, so it is also worth considering looking for apartments on the outskirts. These areas often have good train or ferry connections, so it is easy to commute to the center. Incidental costs can range from €60.00 - €150.00, but of course also depend on your consumption.

It is important to mention that many houses and apartments in Portugal do not have a central heating system. Therefore, many use electric heating, which is why electricity bills can often be higher in winter. As already mentioned above, you have a perfect connection to trains, buses, and ferries in the regions around the big cities. Single trips cost between €1.45 and €2 and are cheaper if you have a ticket that you top up manually (zapping) with amounts from €3 to €40. Within Lisbon, a ride on the metro no longer costs € 1.55, but only €1.34. If you take public transport regularly, a monthly pass would be a great option to save some money. In the city center, the price is around €30 per month. Depending on where you live and which zone your residential area belongs to the price increases.

A monthly ticket does not cost more than € 40 for the surrounding areas. There are also other benefits for people over 65, but these also depend on where you live. More information on the cost of living in Portugal can be found here. You can live a good and carefree life even with a smaller pension in Portugal, especially if you are able to benefit from the tax offers for ten years. From January 1, 2020, the minimum wage in Portugal increased to €635, which results in an annual salary of € 8,890 paid in 14 monthly salaries.

In recent years, many pensioners from other European countries have moved to Portugal. One reason for this is the considerable tax benefit that the country offers to new residents. Foreign pensioners pay no tax on their pensions for ten years. However, from 2020 pensions in Portugal for foreigners will be taxed at only 10%. Which pensions are affected by the tax benefits depends on the country of origin. The motivation for this is obvious. The aim is to create tax incentives for pensioners to invest in the local real estate market in Portugal. This can be a reason to think about emigrating to Portugal as a pensioner. Besides, there are, of course, many other reasons such as the high quality of life, low living costs, pleasant weather, etc. As a pensioner, you can also take out private health insurance. It usually does not cost much and allows access to local health care and private hospitals.

If you buy a property and want to settle in Portugal for a longer time, you have to register with the municipality of your Portuguese residence after three months. You already need a tax number for the registration under residence law. Here you can use your old tax number form your home country so that you are still considered as a resident from abroad. The basic requirement for acquiring the special status is tax residency in Portugal.

You meet this requirement as soon as you are in Portugal for at least 183 days a year, or as of December 31, you have a property that confirms your long-term residence in Portugal. If you meet these requirements, you must register as a “resident” with the Portuguese tax office (Finanças). The Portuguese legislator has linked the tax relief to the special status as an “unusual tax resident” (residente não habitual). If you register as a resident in Portugal for tax purposes, you can either apply right away or until March 31 of the following year. This status is limited to 10 years. Besides, you must not have been a tax resident in Portugal or registered as a tax resident within the last five years before the application. The status is acquired from the year in which the application is made, even if it is still in process. However, one can request that the special status should only apply from the following year.

The maintenance of the special status for the ten years presupposes that one continues to be subject to unlimited taxation in Portugal. The double taxation agreement makes sure that pensions or similar allowances paid to a Portuguese resident are only taxed in Portugal, not as well in the respective home country. With the acquisition of the special tax status, the Portuguese state levies a lump sum of 10% on your pension. The prerequisite is that the pension has not been earned in Portugal, which would be the case if the remuneration is paid in another European country.

By European law, all European countries agree on consistent social security regulations. If you have worked in different European countries during your professional career, these pension periods from all countries are added up. You will then receive pensions from the countries in which you worked. Please note, however, that different conditions apply when it comes to receiving your pension from different states. The insurance institution of the country in which you worked will check whether you meet the requirements. It is, therefore, possible to receive several partial pensions from different countries, even if you want to settle in Portugal. The amount of the pension depends solely on the regulations of the respective country.

As a pensioner, you can easily receive your pension in other EU member states. You no longer have to have an account in your home country, but it can be transferred to your Portuguese account. If you receive partial pensions from other countries, you do not have to keep domestic accounts for all of them. These amounts can also be transferred to a Portuguese account. For the transfer, you will only need an international IBAN and BIC.

The Portuguese healthcare system is one of the best in the world and ranks on 12th place worldwide, according to the WHO (World Health Organization). Primary medical care in Portugal is free in all public health facilities, and the additional payments for treatments are quite cheap. A significant disadvantage, however, is the very long waiting times when making appointments. It is generally recommended for emigrants to take out private health insurance. Although this can be a little more expensive, it not only offers you better medical services but also access to private hospitals, where international doctors work, who may speak English, Spanish, French, but also German. You will find English speaking doctors mainly in the regions of the Algarve and in and around Lisbon and Porto. Below you will find a selection English-speaking doctors for the above areas

List of medical facilities/ practitioners in Algarve

HOSPITAL LUSIADAS – ALBUFEIRA Largo da Correeira Montechoro

8200-112 Albufeira

Tel: 800 201 000 (free phone)

CLINICA PARTICULAR – GUIA SHOPPING, ALBUFEIRA (24 Hours)

Estrada Nacional 125 8200 Guia, Albufeira

Tel: 707 28 28 28

HOSPITAL DE SAO CAMILIO - PORTIMAO

Parque de Saude da Misericordia de Portimao Avenida S. Joao de Deus 8500-508 Portimao Tel: 707 28 28 28 Website: www.hpalg.com

HOSPITAL PARTICULAR DO ALGARVE – GAMBELAS (FARO) (Private – 24 Hrs)

Urbanizacao Casal de Gambelas, Lote 2 8005-226 Faro

HOSPITAL PRIVADO S.GONCALO DE LAGOS

Avenida D. Sebastiao Ameijeira de Cima 8600-502 Lagos

Tel: 282 790700 Fax: 282 760180

Email: saogoncalolagos@hpphospprivados.pt

List of medical facilities/ practitioners in Lisbon

DR. ANDREW FRENCH Professional membership no. 29841

Clínica Cuf Cascais

Rua Fernão Lopes, 60, Cobre 2750-663 Cascais

Tel: +351 211 141 400 Fax: +351 211 141 440

Website: www.saudecuf.pt

DR. FÁTIMA GYSIN Professional membership no. 1767

Campo Grande 156-2º 1700-094 Lisboa

Tel: +351 217 968 084

Website: http://clientes.netvisao.pt/cesca89/frindex.html

PROF. DR. MARTA PIMENTA DE BRITO Professional membership no. 9839

Av. António Augusto Aguiar, 100, 3º dto, 1050-019 Lisboa (next to El Corte Ingles) Mobile/Whatsapp: +351 96 024 83 02

Email: martapimentadebrito@gmail.com

Website: www.martapimentadebrito.wordpress.com

CLÍNICA EUROPA

Rua da Catembre, 165 2775–561 Carcavelos

Tel: +351 214 569 800 Fax: +351 214 569 826

Email: apoioacliente@clinicaeuropa.pt

Website: www.clinicaeuropa.pt

HOSPITAL DA LUZ- CLÍNICA DE OEIRAS

Rua Coro Santo Amaro Oeiras, 12 2780-379 Oeiras

Tel.: +351 217 104 815 (switchboard and appointments) Fax: +351 217 104 809

E-mail: geral@cppoetas.pt

Website: www.cppoetas.pt

List of medical facilities/ practitioners in Porto

DR ANTÓNIO BIANCHI AGUIAR Professional membership number: 844319

Rua Sá da Bandeira, 658-1º E 4000-431 Porto Tel.: + 351 220174699

E-mail: abianchiped@hotmail.com

PROF DR CARLOS RODRIGUES RAMALHÃO

Rua Gonçalo Cristóvão, 236-4º ,Salas 4.1/4.2/4.5/4.6 4000-265 Porto

Tel.: +351 222 089 049 / 50 Fax: +351 222 089 051

E-mail: c.ramalhao@mail.telepac.pt

Website: http://www.clinicadocoracao.net/

PROF. RUI CARRAPATO Professional membership number: 12882

Rua Rainha D. Estefânia, 246-11º sala 41 4150-303

Porto Tel.: + 351 226 068 347 Mobile: + 351 9334 18601

E-mail: rui.carrapato@chedv.min-saude.pt

DR FERNANDO PERES Professional membership: number: 600

Rua Alves Redol, 310-1º 4050-042 Porto Tel.: +351 225 501 825 Fax: +351 225 501 786

Mobile: + 351 916 140 397

E-mail: peresdentaria@netcabo.pt 

As explained in the previous point, it is worth taking out private health insurance in Portugal. The doctors listed above often work in private hospitals, which are not accessible with only the public health system. All private providers have certain insurance offers, which are linked to a monthly price and, coupled with this, determine the benefits covered. Most insurance policies do not cover visits to the dentist, so it is advisable to choose additional insurance here. 

Portugal is the oldest nation in Europe and, due to its location by the sea, predestined to start discovery trips all over the world. If you are interested in history, you can visit historic buildings, museums, and churches across the country and learn more about the history of it. Even the evening events in Portugal, especially in the big cities and in the Algarve can be a wonderful balance to everyday life. Many restaurants, bars, and many music events not only invite you to dance, but also to enjoy and dive into the Portuguese culture. Although Forró and Samba are Brazilian dances, you can find them at bigger events in which Portuguese and foreigners also take part.

At these festivals, a lot of different cultures come together, and you can meet a lot of new people. But you will also find cinemas, theaters or operas in Portugal. Movies in Portugal are often not dubbed, but only with Portuguese subtitles. International movies are usually presented in the original language. Stage plays are often in Portuguese, which might be a bit difficult at the beginning but can also help you learn the language. Last but not least, and probably one of the best ways to spend your free time is a road trip along the beautiful Portuguese coastline. Portugal's beaches are among the most beautiful in the world, and the Algarve, in particular, offers many, even quieter beaches to relax and swim.

There are many ways to learn the Portuguese language. Language schools in Portugal offer a wide range of courses, such as intensive courses, evening or weekend courses, or private lessons. During the summer months, the classes are often quickly full, but in addition to the language course, many schools also offer day trips, on which the newly learned can then be applied directly. If you prefer to learn the language from home, you can choose from a wide range of online courses or apps. Apps like Babbel are particularly useful for deepening vocabulary, but less for strengthening grammar or communication.

Speaking is crucial when learning the Portuguese language, because the phonetic structure is very complex, which often makes it difficult to pronounce many words. It takes a lot of practice, which is why we would recommend participating in a proper course. How quickly you learn the language at the end also depends on your language skills.

People who speak French or Spanish often find it easier to learn Portuguese because the languages are very similar in their basic structure and often also in their vocabulary. Another advantage of a language school or a course with several participants is direct contact with like-minded people. In this way, you not only learn a new language but also meet new people regularly and can build up a social environment at the same time. If you already have previous knowledge, a language tandem is suitable for you, in which you can improve and consolidate your Portuguese, and you will help someone else with your native language. There are often groups on social networks that offer regular events where you meet not only like-minded people, but also locals.

Of course, you will also find a wide range of options for your leisure activities in Portugal. From gyms to golf courses to water sports such as surfing or sailing, there is an activity for everyone. Numerous hiking trails also invite you to explore the country and nature on your own. You can find gyms in all areas of the country, the prices always depend on the respective offer. If you are only interested in the normal gym training, a membership costs about € 30 per month. If you would also like to take part in fitness courses, or if you are looking for a studio that is also equipped with a swimming pool and sauna, the price can go up to €125 per month. It is advisable to compare offers for different gyms and, if necessary, ask about free lessons to see if you would enjoy it.

Golf is a prevalent sport in Portugal to stay fit and to enjoy your free time actively. All over the country, you will find beautiful golf clubs in the middle of nature, with numerous courses for beginners and advanced. The price range for these courses is very wide. If you have your own golf equipment, you only pay for the booked course or the hours you play. There are often discounts if you play in groups or eat something in the adjacent restaurants.

Water sports, especially surfing, are widespread in Portugal and surf courses are particularly popular in summer. Some surf schools also offer classes for adults and retirees. Since there are many surf schools in Portugal, the prices are not too high. For an hour, you pay between €15 and €25, and as you don't have a surfboard as a beginner, the equipment is included. To find out if surfing is the right activity for you, you can ask for a free lesson to see if you would enjoy it. Sailing could also be one of your new hobbies. In the Algarve in particular you will find some sailing schools that you can join. You will often find special offers and courses for retirees and often even English-speaking teachers.

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