Costa Rica Cost of Living

Should I stay or should I leave Costa Rica for a lower cost of living?

Should I stay or should I leave Costa Rica for a lower cost of living?Many of you know that the cost of living in Costa Rica has gone up a lot in the past few years. One of the reasons is that The Costarican government decided to stop with the mini-devaluations in 2006 and move over to a system of exchange rate bands that has kept the Colon on the same value since then.

Exporters are suffering with the bad exchange rate but more and more companies for the US and other parts of the world are still getting installed in Costa Rica, even though the social security system in Costa Rica is expensive and adds onto the labor cost and operating cost of a business.

Procomer, the Costarican entity for commerce promotion, publishes that Costa Rica has 4.6 million people, with 4,600 products exported to 150 countries. In 2014, we exported $11,304 billion in goods, $6,341 billion in services by 2441 exporting companies. It is also true that quite a few Costarican industries have moved to Nicaragua because labor is cheaper there.

Is it true that everything is Costa Rica is more expensive than elsewhere? Why are foreign industries moving to Costa Rica and local Industries moving elsewhere? Is life for a retiree or expat better elsewhere? Should you stay or leave Costa Rica and go back where you came from?

The solution to Costa Rica’s high product prices

The solution to Costa Rica’s high product pricesOn April 8, 2015 the Costa Rica News published a real interesting article titled “The real reason behind Costa Rica’s high product prices”, about the fact that Costarican produced products are cheaper in neighboring countries than in Costa Rica itself, even though there is a high cost of transport. 

This article explains that commercial protectionism of certain Costarican industries, high import tax on foreign products, mostly giants like Dos Pinos (milk products) and Pipasa (chicken and meat products, fresh and frozen) make it possible to charge a much higher price for their products in Costa Rica and export cheaper to neighboring countries.

In case you hadn’t noticed, Costa Rica has become more expensive than it was a couple of years ago. Nobody moves to Costa Rica anymore because it’s so cheap to live here, there are other countries that offer a much lower cost of living. Costa Rica offers many other advantages, about which I’ve written plenty of blogs. BUT, there are ways to save a lot of money that you might not realize, which I’d like to do today, give you a solution to Costa Rica’s high product prices. 

Low cost of labor makes it affordable in Costa Rica

Low labor cost makes it affordable in Costa RicaIn this blog, I will cover some specific examples of shopping for items and services that are inexpensive by comparison between Costa Rica and North America. Pretty much every inexpensive good or service mentioned in this blog is a result of Costa Rica having such a low cost of labor. There are many more solutions that involve a high percentage of labor compared with a smaller percentage of raw materials; putting the resulting cost below that of getting it made or repaired farther up North.

In the States, we always wished that we could afford a housekeeper. We just never could find a way to fit it into our budget, even if only twice a month. Here we are retired in Costa Rica and it wouldn’t it be nice to finally be able to give my wife and me a break, eliminate the sweat and drudgery, and free up our time for more creative and productive endeavors—well, we can and do. Not just twice a month, but Kathy comes every week for a monthly expense of less than one domestic helper’s visit in the States.

The Devil is in the Details

Planning your move to Costa RicaEverything you are about to read might be inaccurate. Except for today’s blog, everything I’m going to tell you in the next several blogs may be old news and no longer valid. That is why it is vital for you to stay on top of your moving plan; because I can tell you from recent first-hand experience about requirements, policies and laws nonetheless their enforcement are all subject to change.

Planning your move to Costa Rica is the best thing you can do with your spare time before you move down here. If you don’t think you have any spare time, make some. You really can’t start planning too early. If you are not a detail-oriented person, force yourself to be. If you are moving with a spouse or significant other with time or some of these traits, get them involved. Get them invested and involved anyway!!! Split up the investigation and due diligence that you really must do to have a successful transition. The more you and your spouse know about Costa Rica, the higher the percentage is that your move here will be for the long-term.

Dining in Costa Rica While Keeping an Eye on Expenses

You will find a multitude of restaurants in Costa RicaWhile the country isn’t renowned for its own cuisine (there are some really great exceptions), you will find a multitude of international restaurants in addition to well-known restaurant chains (if you yearn for a taste of home, but then, why bother coming to Costa Rica in the first place). In our estimate during our visit last year, my wife and I had three of the very best meals we have ever eaten.

One was lunch at an Argentinean-themed establishment, one a seafood meal at a restaurant run by an American ex-pat and one, admittedly, at a Costa Rican-style outdoor restaurant catering to the tourist trade. We had the meals in three different areas of the country. The costs of these three incredible meals were not “cheap” by our standards, but less than what we would have expected to pay in the States for the same quality. In the two weeks we were in country, we ate out lunches and dinners probably 15 times. We never had a bad meal.

Costa Rica - Open Markets and Mom - Pop Stores

Costa Rica - Open Markets and Mom - Pop StoresI remember when I was a youngster (long time ago) and my grandfather would take me to the corner store and buy me a coke and candy. I thought it was the greatest. Those stores in the states were usually family owned and there was a feel of community.

Clothes, hardware, restaurants and grocery stores all gave way to the giant chains in America. Costa Rica shopping is not so different but here in Costa Rica there are chains also but the corner stores and a family owned business is alive and well.
Costa Rica living is much easier and almost every town has an open market of vegetables and fruits usually on a Friday, Saturday or Sunday. The prices are very good and many people shop every week at the open markets.Clothes, hardware, restaurants and grocery stores all gave way to the giant chains in America. Costa Rica shopping is not so different but here in Costa Rica there are chains also but the corner stores and a family owned business is alive and well.

17th of January Last day of Luxury tax payment

Juan Pablo Arias  06/01/2011 for La Nación

17th of January Last day of Costa Rica Luxury tax paymentOn Jan. 17th is the deadline for owners of luxury homes cancel the tax for 2011.

Francisco Fonseca, Director of Taxation, said that this year, the administration expects to receive at least ¢ 2,600 million for this purpose, which is below the target of ¢ 10,000 million, but consistent with the revenue in previous years.

He added that in November last year they had received only ¢ 3,300 million from the luxury home tax for a portion of 2009 (three months) and the accumulated throughout 2010.

This tax applies to residential use properties worth more than ¢ 106 million.Every three years, the taxpayer must file an affidavit to update the property value. If you already filed, only the amount required to be canceled in the calculation of tax.