Puerto Rico vs Panama
We’ve been researching moving to Puerto Rico for a few months now. We learned a ton. Some things we already suspected and some things were a complete shock. But the most unexpected thing we learned was that there is a whole category of benefits to moving to Puerto Rico that we had not foreseen.
You may remember our comparison of Mexico, Costa Rica, and Panama as early retirement abroad destinations, see post Overall Country Comparison for Cost of Living. Using the same matrix, we now want to add Puerto Rico to the mix.
So, we’ll take our top country from the last comparison – Panama – and compare it to Puerto Rico. I think you will find our research results interesting. We will compare the countries, as before, according to our scoring system, see post Retirement Country Scoring System. But we will also get into the more intangible things we found, that were not reflected in our original matrix.
Puerto Rico vs Panama matrix:
|PAN Score||Puerto Rico(1-5)||PR Score|
|Low cost of living||20%||0.75||0.5|
|Proximity to family||10%||0.4||0.5|
|Friendliness to expats||5%||0.225||0.25|
|Religion & culture||5%|
So, that’s the comparison using our original matrix and you can see that Panama comes out slightly ahead of Puerto Rico. This is mainly because the cost of living in Puerto Rico is quite a bit higher than in Panama. Well, mainly the cost of food and utilities is higher but cost of housing is either the same or even cheaper.
Notice, that we are still leaving the Religion and culture section blank because we plan on addressing those separately.
But, let us also consider the “not-so-tangibles” that sort of throw this matrix off.
Immigration/visas – if you’re a U.S citizen, there is no immigration and visas for moving to Puerto Rico. So…. +1 for PR.
Lack of Federal income taxes – you don’t have to pay Federal income taxes in Puerto Rico, see post Taxes in Puerto Rico – The New Tax Haven?. In fact, PR is the only place in the world where U.S. nationals do not have to pay this tax. +1 for PR.
Local flights – there is no customs or other international flight hassles to Puerto Rico. Another +1 for PR.
Low business income taxes – 4% business income tax in Puerto Rico, see this great article from Forbes on the topic of taxes: Hate Taxes? Move to Tax-free Puerto Rico Stay American, Avoid IRS… +1 for PR.
Car\transport – Puerto Rico is a car island, there is really very little public transportation available, so one pretty much needs a car, see post Driving in Puerto Rico. We consider this a negative, so… – 1 for PR.
Poor economy – this one is either a positive or a negative, depending on your point of view. It’s not a secret that the economy in Puerto Rico is in pretty rough shape. We see this is a positive because, as they say in finances, you want to buy low and sell high. Getting moved to PR now, would be like buying low. So… +1 for PR.
All in all, after accounting for these extra factors, we think Puerto Rico comes up as a winner in this game. Yep, the cost of living is higher, and yep you need a car but we believe that the other intangibles really weigh in heavily and put Puerto Rico squarely at the top of our list for countries to move abroad.
What do you think?