The best places to retire in Portugal in 2021

Photo by James Hose Jr on Unsplash
Retire in Portugal / Unsplash
31 May 2021, Emma Donaldson

Portugal is often referred to as one of the best countries in the world to retire to. This so called 'golden age' is the time to enjoy a hard earned life of leisure and leave the world of work behind, and with this in mind, we're going to check out the best places to retire in Portugal.

In 2021, many countries continue to go through a severe pension crisis, not to mention the added complications which in some cases are arising with Brexit and the COVID-19 health crisis across Europe and the world. However, pensioners are not being put off and moving abroad to enjoy a relaxed retirement as a British expat remains a very attractive option for retirees. There are endless options for those who have already retired or see retirement just around the corner, and if you're considering making the move to Portugal, we are here to help. 

Knowing where to retire to is one of many potential barriers for those considering moving abroad: you may find yourself with too many choices, or the idea of lots of paperwork or legal processes may be a turn off. Let's have a look at some of the best places to retire in Portugal in 2021, and see why Portugal really is one of the best countries to retire to, as well as looking at some other important questions about retiring in Portugal.

Where is the best place to retire in Portugal?

One of the main reasons that foreigners choose to retire in Portugal is due to its pleasant climate, beautiful coastline and reasonably priced property, as well as a relatively low cost of living compared to other countries. Portugal has something for everyone, from old but beautiful fishing villages to lively cities full of charm. Let's have a look at some of the best places to live in Portugal for retirees:

The Algarve

Retire in the Algarve
Retire in the Algarve / Unsplash

The main attraction for pensioners in Portugal is of course the stunning Algarve region on Portugal's southern coast. This region is filled with golden beaches and impressive cliffs and in 2021 was recently recognised as the ‘most affordable option in Europe for retirees’ by Forbes. The Algarve proves particularly popular with English-speaking expats and you'll be surrounded by other retirees depending on where you choose to move to.

Within the region itself, there is plenty to choose from in its 16 municipalities. Property prices depend on location but prices are lower than in other parts of the country (the cheapest property in the Algarve is found a little bit further away from the coast), while cost of living is also lower than in the big cities. The region is known for great safety and the Algarve is perfect for pensioners who want a lively and active lifestyle, especially for those who enjoy a round of golf, given the region's fame as home to some of the top golf courses in Portugal and Europe.


Retire in Madeira
Retire in Madeira / Unsplash

Beautiful Madeira is a Portuguese island situated in the Atlantic, around 1,000km off the coast of mainland Portugal and 600km from Africa. This spectacular destination has a temperate climate and experiences warm weather for the majority of the year, making it another great option for pensioners. The archipelago has fewer tourists than the Algarve but at the same time, the expat community here is growing. 

Madeira is a great place for those who want to live away from the hustle and bustle of a city as it is close to nature and is the perfect place to embrace an island lifestyle. While the cost of living is a little more expensive in Madeira than in the Algarve, there are also a great variety of properties for sale and rent at reasonable prices. Moreover, the island hasn't been as affected by the COVID-19 pandemic and life in pretty normal on the island. 


Retire in Lisbon
Retire in Lisbon / Gtres

Another great option for those who want to retire in Portugal is the province of Lisbon. Here you will clearly find the capital city of Portugal, Lisbon, which is in many ways the beating heart of the country and welcomes pensioners from around the world. There is a thriving expat community and plenty going on for those seeking a lively retirement, while Lisbon has also recently been named as one of the top 10 cities with the best living conditions for pensioners

Real estate is more expensive in Lisbon city centre than in other parts of Portugal, and neighbourhoods can be crowded and noisy, but this is something that can be avoided by living in the outskirts. Another good option in the district of Lisbon is Setúbal, a smaller city but just as charming, which is close to nature and the region's beautiful natural parks, as well as being just a short drive from Lisbon itself. 

Porto and Northern Portugal

Retire in Porto or Northern Portugal
Retire in Porto or Northern Portugal / Unsplash

Often when considering where to live, and retire, in Portugal, people overlook Northern Portugal. Apart from the charming city of Porto which has a large expat community, the rest of this region also has a lot to offer for expats and pensioners. This mountainous area has beautiful countryside and vineyards and is a very affordable option for pensioners who want to live in an area with fewer tourists, including the stunning Douro Valley which is a haven of tranquility and perfect for wine lovers.

Property prices in Northern Portugal are among the lowest in the country, and living in the north doesn't mean you have to miss out on the beach, as this region of Portugal is also home to over 100km of rugged coastline. 

What you need to know if you want to retire to Portugal

In 2009, changes in Portuguese retirement tax laws made it even easier and more attractive for expats to retire in the country, especially for EU citizens. If you are planning to retire in Portugal in 2021, there are important aspects you must consider such as the retirement residency law, healthcare, tax information and visas. For all the information, check out our guide on retiring in Portugal for expats.

What will happen to pensioners in Portugal after Brexit?

Brexit is now a reality and one of the biggest questions asked by British citizens who have retired overseas or who are planning to do so is what the consequences of Brexit will be.

First and foremost, the UK government has stated that it will continue to pay a State Pension to those eligible in the European Union after Brexit and that despite Brexit, things shouldn’t change too dramatically for expats living abroad in the EU. If you were resident in Portugal at the end of the transition period (which ended on 31st December 2020), you will be covered by what is known as the Withdrawal Agreement, and your rights will be protected for as long as you remain resident in Portugal. Therefore, the main advice for UK pensioners living in Portugal is to legally become a resident as soon as possible. Find out more about what Brexit means for expats living in Portugal.

Ready to find the house of your dreams?

Ready to find the house of your dreams?

Find houses for sale and long term rentals on idealista