Portugal is often considered one of the best places to retire, offering a relaxed lifestyle and great value for money. In 2025, many retirees are choosing Portugal as a haven from global challenges like the pension crisis, Brexit, and rising living costs. If you're looking for the cheapest place to retire in Portugal or the best retirement villages, Portugal offers a range of options. In this article, we’ll explore the best places to retire in Portugal in 2025 and why it remains a top choice for retirees.
- The best place to retire in Portugal
- Where do most Brits retire in Portugal?
- The cheapest place to retire in Portugal
- Are there retirement communities in Portugal?
- What you need to know if you want to retire to Portugal
- Is it better to retire in Spain or Portugal?
- Potential downsides of retiring to Portugal
- Retiring in Portugal after Brexit
- Retirement in Portugal for US citizens
- How much money do you need to retire comfortably in Portugal?
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. But where is the best place to retire in Portugal? Portugal has something for everyone, from old but beautiful fishing villages to lively cities full of charm, as well as a large number of retirement communities. Let's have a look at some of the best places to live in Portugal for retirees:
The Algarve
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 recent years has been 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, as well as many retirement communities. Property prices in the Algarve 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.
Madeira
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 when it comes to places to retire in Portugal. The archipelago has fewer tourists than the Algarve but at the same time, the expat and retirement community is growing here.
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.
Lisbon
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.
While Lisbon is one of the best places to retire in Portugal, keep in mind that 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.
Cascais
Living in Cascais once retired offers a blend of coastal charm, cosmopolitan amenities, and a relaxed lifestyle. Located just a short drive from Lisbon, Cascais attracts retirees with its stunning beaches, historic architecture, and vibrant cultural scene, making it an appealing destination for those seeking a relaxed yet dynamic retirement lifestyle in Portugal.
Cascais is a paradise for golf enthusiasts, with several championship golf courses nearby, including the renowned Oitavos Dunes and Quinta da Marinha Golf. Retirees can also enjoy hiking and cycling along scenic coastal trails, exploring nature reserves like the Parque Natural Sintra-Cascais, or indulging in spa treatments at luxury resorts.
Porto and Northern Portugal
We're now heading north on our map of Portugal to explore some of the best places to retire. While many tend to overlook Northern Portugal when considering where to live, this region's charm, with its scenic cities and countryside, makes it a top choice for retirees. Beyond Porto, which boasts a large expat community, Northern Portugal offers plenty for expats and pensioners. The mountainous landscape, lush vineyards, and tranquil countryside make it an affordable option for those seeking a quieter lifestyle, especially in the stunning Douro Valley—a wine lover's paradise and peaceful retreat
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.
- Find property for sale in Porto and Northern Portugal
- Find long-term rentals in Porto and Northern Portugal
Where do most Brits retire in Portugal?
The Algarve is by far the most popular destination for British retirees in Portugal. Known for its stunning beaches, sunny climate, and relaxed lifestyle, it has long been a favourite among expats. The region offers a wide range of amenities, from golf courses to excellent healthcare facilities, making it an ideal choice for retirees looking for both comfort and convenience. Popular towns such as Lagos, Albufeira, and Tavira attract a large British expat community, with many choosing to settle in quieter, less touristy areas to enjoy a more peaceful lifestyle.
Another popular destination for Brits is the Lisbon area, particularly the capital city itself and the nearby coastal towns like Cascais and Sintra. Lisbon’s vibrant cultural scene, excellent transport links, and diverse expat community make it an appealing choice for retirees who still want to be close to city life. The surrounding coastal areas offer a combination of beautiful beaches and a more relaxed pace of life, providing retirees with the perfect balance of urban and seaside living. Both regions offer strong British expat communities and a high quality of life, making them top choices for retirees looking to make the move to Portugal.
The cheapest place to retire in Portugal
When looking for the cheapest place to retire in Portugal, several regions offer more affordable living costs compared to urban or coastal areas. Rural regions like the interior Alentejo, central Portugal, and Northern Portugal provide budget-friendly options with tranquil atmospheres, scenic landscapes, and a strong sense of community.
In the Algarve, inland towns and the eastern part of the region offer more affordable alternatives to the coastal tourist hubs. Factors such as housing costs, healthcare accessibility, and lifestyle preferences should be considered when determining the best fit for retirement needs and budget. It's essential to explore different regions, consult with locals, and weigh the pros and cons of each area before making a decision.
Are there retirement communities in Portugal?
Portugal is home to retirement communities, both for local residents and expats. These communities offer various amenities and services tailored to retirees, such as healthcare facilities, recreational activities, social events, and assistance with daily living tasks. Some retirement communities in Portugal are designed specifically for expats from other countries, offering services in multiple languages and catering to the needs and preferences of international retirees. These communities can be found in different regions of Portugal, including coastal areas, rural settings, and urban centres, providing retirees with a range of options to suit their lifestyles and preferences.
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 2025 or beyond, 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.
Is it better to retire in Spain or Portugal?
The decision of whether it's better to retire in Spain or Portugal depends on various factors and personal preferences. Both countries offer attractive options for retirees, each with its own advantages and drawbacks. Here's a comparison to help you make an informed decision:
- Climate: Both Spain and Portugal have generally mild climates, with plenty of sunshine. Coastal areas in both countries offer particularly pleasant weather. However, Portugal tends to have slightly cooler temperatures, especially in the northern regions, while southern Spain can get hotter in the summer months.
- Cost of Living: Portugal is often considered to have a slightly lower cost of living compared to Spain, particularly in terms of housing and healthcare. However, the cost of living can vary significantly depending on the region within each country.
- Healthcare: Both countries have well-regarded healthcare systems, with options for public and private healthcare. Portugal's healthcare system is often praised for its quality and affordability. Spain also has excellent healthcare, particularly in popular expat areas along the coast.
- Culture and Lifestyle: Spain and Portugal have rich cultural heritage and offer diverse lifestyle options. Spain is known for its vibrant cities, lively festivals, and diverse cuisine. Portugal offers a more relaxed pace of life, with charming towns, scenic landscapes, and a strong emphasis on family and community.
- Residency and Taxes: Both countries offer residency options for retirees, including special visa programs for non-EU citizens. Taxation policies vary, so it's essential to consider how your retirement income will be taxed in each country.
- Language: Language may play a role in your decision. Spanish is widely spoken in Spain, while Portuguese is the primary language in Portugal. However, many people in both countries speak English, especially in tourist areas and larger cities.
Ultimately, the best choice depends on your personal preferences, lifestyle priorities, and individual circumstances. It's essential to visit both countries, explore different regions, and consider factors such as climate, cost of living, healthcare, culture, and language before making a decision. Additionally, consulting with financial and legal advisers can help you navigate residency requirements, taxation, and other important considerations for retiring abroad.
Potential downsides of retiring to Portugal
Retiring to Portugal offers numerous advantages, including a mild climate, affordable cost of living, and quality healthcare. However, potential downsides include language barriers, bureaucratic challenges and varying access to specialised healthcare. The cost of living can fluctuate depending on the region, and social integration may pose difficulties for those without existing connections. Despite these challenges, thorough research, seeking expatriate communities, and consulting with legal advisers can help retirees navigate the transition and enjoy a fulfilling retirement in Portugal.
Retiring in Portugal after Brexit
Retiring in Portugal after Brexit has become an increasingly popular option for many British expats seeking a peaceful and affordable lifestyle in Europe. With its stunning landscapes, mild climate, and relatively low cost of living, Portugal offers an attractive retirement destination for Brits. Although Brexit has introduced new rules and regulations for UK nationals, including changes to residency and healthcare rights, Portugal remains a welcoming destination for retirees. The country has a long-standing expat community, and many British retirees continue to be drawn by the warm hospitality, excellent infrastructure, and high quality of life.
Since Brexit, UK nationals are now required to apply for residency under the new immigration rules, such as the D7 visa, which is designed for those with a stable income. Fortunately, Portugal has a straightforward and efficient application process, making it easier for retirees to establish their long-term residence. Additionally, healthcare arrangements have changed, but retirees can still benefit from the country's high-quality public healthcare system, provided they meet the necessary residency and contribution criteria. With its beautiful coastlines, charming cities, and relaxed pace of life, Portugal remains a top choice for those looking to retire after Brexit.
Find out more about what Brexit means for expats living in Portugal.
Retirement in Portugal for US citizens
Retirement in Portugal for US citizens has also become an increasingly attractive option due to the country's affordable cost of living, beautiful landscapes, and high quality of life, not to mention those looking for a new life abroad after Trump's election victory. Portugal offers several residency visa options for retirees, with the most popular being the D7 visa mentioned above, designed for individuals with a stable income from pensions or other sources. This visa allows retirees to live in Portugal long-term, provided they meet certain income requirements and can demonstrate sufficient financial means to support themselves. The D7 visa process is relatively straightforward, and Portugal's welcoming approach to foreign nationals has made it a desirable destination for US retirees seeking a more relaxed lifestyle in Europe.
In addition to the attractive residency options, US citizens retiring in Portugal can enjoy the country's excellent healthcare system, which offers both public and private options. While retirees may need to arrange for private health insurance until they qualify for public healthcare, Portugal's healthcare system is known for being affordable and of high quality.
How much money do you need to retire comfortably in Portugal?
The amount of money you need to retire comfortably in Portugal depends on your lifestyle, location, and personal preferences. On average, a single retiree might need around €1,500 to €2,000 per month to cover basic expenses, including rent, utilities, food, healthcare, and transportation. Living in more affordable areas like the interior of the country or smaller towns may reduce living costs, while cities like Lisbon, Porto, or the Algarve can be more expensive, particularly in terms of rent and dining out.
To comfortably retire in Portugal, it's recommended to have a stable income or savings that can cover at least €18,000 to €24,000 annually. If you plan to rent, a one-bedroom apartment in a less expensive area might cost between €500 and €800 per month, while more central locations or larger cities could cost upwards of €1,200 to €1,500 per month. Additionally, you should consider health insurance, as while public healthcare is available, many retirees opt for private insurance for more comprehensive coverage. Planning a retirement budget that accounts for both expected and unexpected costs will ensure you can enjoy a comfortable and stress-free life in Portugal.
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Living in Caminha: Portugal’s green border town
Right up in the green corner of Northern Portugal, where the wide Minho River meets the Atlantic, sits the market town of Caminha. With one foot on the coast and the other practically in Spain, this scenic spot offers a unique slice of Portuguese life. It’s a place defined by its olde worlde charm, with a beautifully preserved medieval centre and a tranquil atmosphere governed by the tides.