If you like perpetual summer, you will love Panama.
The country connecting the North and South American continents is tropical and it stays warm year-round.
It may be too warm and humid for some tastes, however.
There is a lot to like about Panama, and it is becoming a more popular country with Americans looking to live or retire to another country.
The capital, Panama City, is a large city at 500,000, and there are a lot of rural areas if you prefer not to live in the city.
- Pros of Living in Panama
- Cons of Living in Panama
- Pros and Cons of Living in Panama – Summary Table
- Panama Safety Overview
- Frequently Asked Questions
Pros of Living in Panama
1. The weather, if you like summer
The temperature very rarely drops below 75 or above 92.
There is a lot of rain at certain times of the year, but the temperature will be constant.
There are no seasons.
It can get very humid and that is a bigger complaint than the heat.
There are also 12 hours of sun and 12 hours of dark every day, and this never changes either.
In the rainy season, the rain comes at about the same time every day.
2. Low cost of living
The cost of living is much lower than it is in medium to large cities in the United States or Europe.
You can rent a condo near the beach for 1200 a month and less than that if you live inland.
Things like utilities, food, going out to eat, and so forth, are also significantly less expensive than what you might be used to in America.
You can buy fresh fruit and vegetables very cheap at outdoor markets.
Imported items are more expensive, however.
In the countryside, you could live well on $1500 a month, and between $2,000 and $3000 a month in the best area of Panama City.
3. Public transportation
Especially in Panama City, public transportation is cheap, reliable, and easy to use.
It is called the Metro, and there are buses going all over the city 24 hours a day.
There are also buses to take you out of the city and to other towns.
The bus lines are separate from the Metro, but they take you everywhere.
Most tickets are 35 cents.
Roads are modern and good throughout the country.
4. The food
Panama City has a tremendous number of restaurants with every kind of food you can imagine.
Panamanian food has a lot in common with other Central American countries, but it has some flair of its own.
It is a combination of Hispanic, African, Indigenous, and Antillian cultures. Panamanian Rice and Beans are different because of the spices it uses, and the addition of pork.
In the countryside, you will find more traditional Panama cuisine.
5. People are friendly
Panama has a well-deserved reputation for having friendly and welcoming people both in Panama City and in the countryside.
There is a lot of hospitality and foreigners quickly feel at home once moving there.
People are generally helpful too, but you will have to learn Spanish to get much interaction.
Outside Panama City and tourist areas, you may find everyone speaking Spanish.
6. Retirement benefits
Panama offers retirement benefits for citizens and for people from other countries.
If you are getting pension benefits in another country, you get all the benefits that retirees get.
This includes tax breaks on household goods and on automobiles.
You get 50 percent off hotels and entertainment.
There are also 25-30 percent discounts on public transportation, medicine, restaurants, as well as professional services.
7. Good inexpensive healthcare
There are several options for healthcare in Panama, and the quality of care is as good as anywhere in Latin America.
There is a free service available that has long waiting times.
You can get private insurance at private facilities at a low cost and get faster service.
You can also self-insure, meaning you pay for small things yourself.
A doctor’s office visit, for example, is $12.
You will need to shop around and discover all the best options before choosing the best one for you.
8. Political and economic stability
Regardless of where you live in the country, there is safe water, good internet, reliable power, and good healthcare.
Panama has had the strongest economy in Latin America for the last several years.
There is no right vs. left division, as the parties tend to be more business-like or business-related.
It is a relaxed atmosphere and they choose a president to serve a five-year term.
Cons of Living in Panama
1. The weather
The weather is perhaps the best and the worst thing about Panama at the same time.
What is not to like about tropical summer conditions year-round?
The rain for one thing.
When it rains it rains hard for a long time.
In the rainy season, it may rain hard for two hours nonstop, but then the sky will clear.
It may never get above the low 90s, but the humidity is very high all the time, making it feel hotter than it is.
2. Crumbling infrastructure
Power outages and water outages are common.
They usually only last a few hours, but it is still inconvenient.
Most people buy a backup water tank and have a backup supply of electricity like a generator.
Power outages are more common in rural areas, but they still happen a lot.
Many sidewalks and streets in Panama City have potholes and cracks, and they are not level.
Also, pedestrians do not have the right of way.
3. Everything is slow
Fast-paced Americans will have to adjust to the slower pace of life in Panama, which is common for Latin America in general.
You may have to wait half an hour in line at the bank or the post office.
You may wait even longer if you are dealing with the government.
If you get angry or complain, your wait will get even longer.
Panama people take it in stride and do not seem to mind the slower approach.
This is something that will not change though, and you will have to adjust or be upset all the time.
4. The language barrier
Unlike many Latin American countries, most people in Panama do not speak English.
They speak Spanish like the rest of Latin America.
You might be able to get away with not knowing Spanish in tourist areas of Panama City, but not if you are out in the country.
Dealing with the government at all will require you to know some Spanish.
Panama people love parties and socializing.
Parties often start around 9 p.m. and go well beyond midnight.
Walls are thin at times, and you may not get any quiet until the wee hours of the morning.
But in Panama, you can probably join the group, party, and have a good time.
Work is not the top priority, and they want to be able to have a good time.
This can be a lot of fun, or it can be stressful.
6. The Manana principle
Manana is Spanish for tomorrow.
If someone is talking about something getting done tomorrow, it does not necessarily mean the day after the current day.
It only means, not today.
It is part of the slower, more laid-back lifestyle.
They do not get too stressed or upset about things.
Things get done when they get done.
Life has to happen first in Panama.
People and relationships take a priority over jobs.
7. Cash society
It is just an inconvenience, and may not really be a con.
Almost every transaction is paid for in cash.
No one takes checks, and only a few will take credit cards.
This could also mean you have to go somewhere to pay your utility bills in cash, though there is some modernization as far as this type of bill goes.
You do have to remember to carry cash though because you will not be able to buy much without it.
It is a good thing the crime rate is low.
8. Traffic issues
In Panama City, rush hour can be a nightmare.
If you do not have to, do not drive then.
Most roads are well marked, but there are some street signs missing in Panama City.
The roads in the mountains can be scary.
People make use of both lanes when driving around sharp curves, which can cause an accident.
Drunk driving is prohibited and they are serious about this.
You will get in a lot of trouble.
Pros and Cons of Living in Panama – Summary Table
|Pros of Living in Panama||Cons of Living in Panama|
|1. The weather, if you like summer||1. The weather|
|2. Low cost of living||2. Crumbling infrastructure|
|3. Public transportation||3. Everything is slow|
|4. The food||4. The language barrier|
|5. People are friendly||5. Noise|
|6. Retirement benefits||6. The Manana principle|
|7. Good inexpensive healthcare||7. Cash society|
|8. Political and economic stability||8. Traffic issues|
Panama Safety Overview
READ THE FULL REPORT: Panama Safety ReviewSafety Index:
- OVERALL RISK: MEDIUM
- TRANSPORT & TAXIS RISK: MEDIUM
- PICKPOCKETS RISK: HIGH
- NATURAL DISASTERS RISK: MEDIUM
- MUGGING RISK: MEDIUM
- TERRORISM RISK: LOW
- SCAMS RISK: MEDIUM
- WOMEN TRAVELERS RISK: LOW
Frequently Asked Questions
What is the Darien Gap?
The Pan American Highway stops suddenly in the Panama town of Vaviza.
There is a 66-mile gap from there into the next town in Columbia.
There are rugged mountains and marshland in between.
It would be very expensive and environmentally dangerous to build a road through that area.
There have been attempts but environmental concerns have stopped it so far.
Does the U.S. Still own the Panama Canal?
The United States turned over control of the canal to the nation of Panama on Dec. 31, 1999.
It is operated by Panama officials today.
In 1979 the U.S. gave control of the canal to Panama and gave it up completely later.
What is a retirement visa?
This is a special visa for retired people.
If you are retired, you can move to Panama and enjoy all of the benefits retirees there receive.
This keeps it ranked high in the best places to retire.
Income requirements are lowered and once you have it you do not have to renew it.
There are huge discounts on entertainment, public transportation, airplane flights, restaurants, and many other things.
What is the currency of Panama?
The official government currency is called the Balboa, but the U.S. Dollar is recognized as legal tender.
The dollar is used more in regular commerce than the Balboa and Panama no longer print its own money.
They have the same value.
An American does not need to exchange currency since the dollar is accepted.
What does the territorial tax system mean?
Panama is one of a few countries that have a pure territorial tax, which means they only tax money that was made in the country for income tax purposes.
If you live in Panama and make your money online, or from somewhere else, the country will not tax that income.
The United States uses a residency-based system, meaning you pay taxes for where you live regardless of where it came from.
If you gave up your United States residency status and made all your money online, you would essentially not have to pay any income tax.