Many people want to spend their retirement in Mexico because of the pleasant weather, rich culture, welcoming locals, and lower cost of living. And we believe you’ll have a better quality of life living in Mexico for less money.
For starters, it’s much more affordable than retiring in the U.S. or Canada. And the slower pace of life and warmth of the Mexican people will help you to have less stress and a better sense of community.
But planning and budgeting for retirement can be overwhelming. It is impossible to know how far your retirement savings will stretch. Logically, you may be thinking of lowering your cost of living to retire earlier or make your savings last longer.
But how much savings do you need to retire in Mexico without fearing running out of money? And how should you be saving for retirement in Mexico when it’s so near?
There Is No “One Size Fits All”
I am not a financial advisor. The information in this blog post is for information purposes only
Ideally, everyone will start saving for retirement in their 20s.
However, that’s not always the case. Life happens. We have other priorities, so we play catch-up later in life.
And how much money YOU need in retirement will depend on many things. But mostly, it will depend on how much money you currently live on and what quality of life you want to have in retirement.
Having said that, 10-12 times your annual income is a good rule of thumb.
For example, if you intend to retire at 67 and earn $60,000 annually, you should aim to save between $600k-$750k USD at retirement. That’s assuming you plan to spend the same income in retirement as you did in your active years.
And I mention this because you will need much less to live in Mexico at the same level as North of the Border. Many people reduce their cost of living by 30-50%.
So, you’re $60,000 USD lifestyle could probably be done with $42,000 or $30k USD. If you’re from Canada, consider that the exchange rate is not as strong as the USD. Canadians living in Mexico still report lowering their cost of living by 30-50% without sacrificing quality of life!
But if you retire early, you must consider how many years you “expect” to live and account for fluctuations in the exchange rate, inflation, possible medical care as you get older, and your goals.
Cost Of Living in Mexico
So how much can you expect your cost of living in Mexico? That’s entirely up to you! To give you an idea, the average household income in Mexico is $8,000 MXN a month. That’s about $420 USD or $620 CAD. That’s probably less than your monthly grocery bill for a 2-person household in the U.S. or Canada!
Mexico has a lower cost of living than many other countries, especially regarding food, transportation, and healthcare. Fresh fruits and vegetables, as well as street food, can be purchased inexpensively. Public transportation is also affordable, and taxis are widely available. Medical and dental care in Mexico is high quality and is often less expensive than in other countries.
However, your personal cost of living will depend on things like:
- Your housing costs.
- Your utility costs.
- Your health insurance premiums.
- Where you do your grocery shopping- local markets vs. high-end grocery stores.
- Any medical treatments that are paid out of pocket.
- How often you travel.
- Your entertainment preferences.
- How many people are in your household.
- Whether you live in a tourist city vs. not.
- If you buy local vs. only imported items.
- Do you walk/use public transport vs. have your own car.
- Cook at home or eat out a lot.
- Buy expensive clothing/accessories vs. non-brand items.
- And so on…
You get the idea.
I can tell you that after running Mexico Relocation Guide for almost 3 years and after thousands of customers sharing their expenses, 2 people can easily live in Mexico (anywhere in Mexico) for USD $1,500- $2,000 a Month.
But many foreigners living in Mexico come with higher incomes and expensive tastes. And we know several people who easily spend $5-$6,000 USD a month or more.
My advice; regardless of your budget, it’s a good idea to have a budget and stick to it so you never run out of money while retiring in Mexico. Especially considering that many people move to Mexico without a health insurance plan and are set back when they have to pay the hospital bill out of pocket.
Always save for a rainy day.
Requirements For A Residency Visa in Mexico
Even though you can easily live on $1500-$2000 USD a month in Mexico, you have to consider that to qualify for a residency visa, you’ll have to prove you’ve earned more or saved more.
The 2023 Economic Solvency Requirements for A Temporary Residency in Mexico start at $2,600 USD and go up to $3,300 USD a month. The discrepancy is with the consulates because each Mexican Consulate abroad has its own income requirements for temporary residency.
But you can do “consulate shopping” and find the consulate closest to you or the consulate that has the best requirements for you to apply.
Visit our site to get an idea of the income requirements by Mexican consulate.
After many years of contributing to social security, the time is near to take advantage of those monthly payments. However, planning a social security strategy before retiring is wise.
You can start taking social security payments anytime from age 62-70. The longer you wait to start taking those payments, the higher the monthly paychecks will be. So, you’ll want to consider what works best for you according to your other savings, investments, etc.
If you’re from Canada, you can start taking Old Age Security at 65. However, to be eligible for this while living in Mexico, Canadian citizens must have resided in Canada for at least 20 years since the age of 18.
Supplement Your Income With A Side Hustle
I know, I know. That sounds like an oxymoron. You’re thinking, “I just retired. I’m trying NOT to work.” And I’m with you. You’ve worked your entire adult life, and it’s time to start the next chapter and enjoy life to the fullest by retiring in Mexico.
However, getting part-time work while “retired” in Mexico can help to stretch your savings. Now, remember, I’m referring to a side hustle. That means you won’t be looking for a 9-5 job that has you chained to a desk.
There are plenty of sites that can help you find part-time remote work options that are interesting to you. For example, you could tutor, write, or do consulting work. Whatever your interest and experience, you will likely find a remote job that suits you. You may even find this new work to be quite fulfilling.
Great Sites To Find Remote Jobs
Here are some great sites where you can find remote work:
- Just Remote
- Career Vault
- Virtual Vocations
- Working Nomads
- Remote okay
- Authentic Jobs
- We Work Remotely
With new technology and the explosion of remote working in recent years, there are seemingly endless opportunities for earning money in a less conventional way than you may have for most of your career. So, take this opportunity to find a job that excites you (or you don’t dread) and start applying.
Having even just a little extra cash each month will go a long way when you retire in Mexico. Who knows? Your extra gig could cover your monthly rent and food expenses!
Is It Safe to Retire in Mexico?
You mention the idea of retiring in Mexico at your neighborhood block party, and you’re met with a stream of concerned faces and questions on safety. If that’s the case, your neighbors have never been to Mexico.
Globally, Mexico has a bad reputation for safety. However, many of those concerns are completely unwarranted. If you go to Mexico, you’ll most likely be greeted by friendly locals, delicious cuisine, and beautiful landscapes.
So, what’s the real deal with safety in Mexico?
Well, whenever traveling internationally, it’s wise to check the travel advisories for the area you’re going to. However, many of the best places to retire in Mexico are also some of the safest areas.
With so many people retiring in Mexico, the most popular areas have a close-knit, ex-pat community. So, you can look forward to finding like-minded people in your new home.
When it comes to safety, you should practice the same caution you would in many other places:
- Don’t walk alone at night.
- Carry modest amounts of cash.
- Research new places before visiting.
Overall, Mexico is a safe country for retirement. Mexicans are extremely hospitable, and you’re sure to fall in love with Mexico for more than its practical low cost of living.
If you’re looking to retire soon or are starting to plan, retiring in Mexico could be one of your best life decisions. You’ll surely have a new adventure full of rich culture and natural beauty that will give you a new perspective on this new tranquilo (relaxed) way of living.
Use this beautiful country as your motivation to start planning and creating a realistic budget for yourself. Remember that retirement in Mexico means you’ll have a much lower cost of living, making your savings last even longer. This gives you the possibility of retiring sooner and having a higher quality of life than you might be able to afford in your home country.
How Can We Help?
Are you thinking about making the move to Mexico? Then our COMPLETE Mexico Relocation Guide was made for you!
Our COMPLETE Mexico Relocation Guide will take the guesswork out of your move and answer all your questions. With our easy-to-follow online guide, you’ll have a smooth transition to your new life in Mexico.
Plus, get access to our complete directory of recommended contacts across Mexico. And We never accept kickbacks, commissions, or any form of compensation from the providers we recommend, so you don’t have to worry about us cherry-picking our recommendations. We only recommend the businesses and people we trust.
Let’s face it….. There’s a lot of FREE information on moving to Mexico out there. Unfortunately, much of it is outdated, confusing, vague, or simply wrong! You get what you pay for.
We spent thousands of hours researching the most important topics about moving to Mexico. Then we had it all fact-checked by experts in each field, like immigration assistance, realtors, health insurance brokers, pet importers, relocation tour guides etc. Finally, we put it all together in an easy-to-follow online course.
That way, you’re not making important decisions about moving to Mexico based on outdated or wrong information. And because this is an online guide, it is consistently updated with factual and up-to-date information.