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Panama vs. Ecuador: Where Is the Best Place to Retire?

Cuenca, Ecuador photo by Jonathan Hood

Cuenca, Ecuador photo by Jonathan Hood

When considering relocating to Latin America, many would-be expats quickly narrow their search down to the countries of Ecuador and Panama.
And why wouldn’t they?

Ecuador has topped out International Living’s list of best places to retire for five years running, with Panama always following closely in the second or third spot.  This list is based on an index of different factors such as climate, cost of living, culture, and many more.  However, much of this criteria is highly subjective.  The hot, humid climate you enjoy could be someone else’s idea of misery.  Likewise the Burger King on the corner might be a welcome sight to some, but for you it might evoke the very feelings that prompted you to leave behind the cookie-cutter culture of the States.We’ve outlined some of the major differences between the two countries below, but don’t take our word for it.  The best decision-making tool is your own observation.  Plan a trip, and check things out for yourself.

Cost of Living

In this category, the advantage goes to Ecuador.   In most parts of the country, you can easily get by on about $1,200 per month, including rent.  This number gets even lower the further you venture into the rural areas where monthly rent can run as low as $150 per month.  Combine that with an average cost of $1.90 for a four course meal, $1.50 for a gallon of gas, and the help of a domestic servant for a mere $10 a day.  While it is possible to get by on the same $1,200 in Panama, it would be with a standard of living that more closely resembled that of the locals.

Real Estate

While Ecuador wins this one for its low cost homes, Panama may have a slight edge when it comes to the ease of the entire process.  New homes in Ecuador are well below the $100/square foot price.  That’s half the price of comparable homes in Panama, although the construction is different.  Homes in Ecuador are built of cement and red clay.

The home buying process is easier in Panama, where international banks are quick to offer financing to foreign residents.  Closing costs are twice as high in Panama (around 6%).  However, property owners in Panama may be exempt from property taxes for a number of years if the home is their only residence.


The infrastructure of Panama closely resembles that of the U.S., and its roads are much more well-maintained.  Other than that, there’s little difference between the two countries.  Ecuador offers several options for public transit, including buses and taxis, that average around $1 per hour.  However, they may not be the safest options (See Safety below.)  Panama offers similar modes of transportation for a slightly higher premium.  Both countries offer convenient direct flights to several U.S. hubs from a few key cities.

Health Care

While health care in both countries is better than you’d expect, the quality may be slightly higher in Panama, particularly in David and Panama City.  Panama boasts many private hospitals with English-trained and English-speaking doctors.  In both countries the cost is lower than U.S. health care, up to 90% lower in Ecuador where doctors will even make house calls for less than $25.  Both countries also offer a variety of health insurance options for foreigners.


Now here’s where personal preference really plays a big factor.  While we can’t say which countries earns the most points in this category, we can tell you which one most closely resembles the culture of the U.S.  It’s Panama.  With a much larger and more established expat community, Panama will initially feel the most like home.  It’s up to you to decide whether that’s the atmosphere you’re seeking.

Both countries use the U.S. dollar, so there’s little risks associated with currency exchange.  English is widely spoken in both, although in Ecuador it’s largely confined to touristy locations and international business areas.  Both are also home to many U.S.-based restaurant chains and other franchises.  Modern conveniences are found in both, although internet service is reportedly much better in Panama.  It’s true in both countries that communication is more accessible the closer you are to the larger cities.

Weather in Boquete Panama

Boquete, Panama photo by Ken Mayer


While this factor also depends greatly on your own personal taste, most will probably prefer Ecuador for its more temperate and varied climate.  Panama is mostly hot and humid everywhere with large amounts of rainfall, particularly in May through December, although it’s slightly lower on the Pacific coast than the Caribbean side.  The only real difference in the country’s climate is in the higher elevations where the temperatures and rainfall both decrease.  Some areas may see temps in the 50’s versus the 84 degree average near the coast.

Ecuador experiences a more diverse climate across its four main regions.  The mountainous Andean Sierra boasts average temperatures of 75 degrees by day and around 60 at night.  With a lot of sunshine, 12-hour days, and relatively low humidity, its climate is considered by most to be nearly perfect.  Ecuador’s coastal region and the Amazon rain forest more closely resemble the climate of Panama:  hot and humid all year with temps ranging from 80 to 95 degrees and year-round rain.  The Galapagos Islands have much milder temperatures and less rainfall.


While Ecuador and Panama both have plenty of cultural attractions, the edge here goes to Ecuador.  While both countries boast many activities and forms of entertainment, those in Ecuador are often more authentic and less Americanized.  With over 28 indigenous groups speaking more than 10 languages, evidence of the country’s heritage fills the marketplaces and festivals that abound in the South American nation.  Panama is also a culturally rich country, but often in the form of museums and shopping districts.

Residency and Retirement Benefits

Panama wins this one, hands down.  Requirements for a pensioner’s visa are similar between the two ($1000 per month income in Panama versus $800 in Ecuador).  However Ecuador offers very few incentives for retirees.  Panama, on the other hand, boasts a long list of discounts for those who qualify for its pensioners program.  This includes savings of between 10 to 50 percent on virtually every category of goods and services including utilities, closing costs, entertainment, travel, and even health care.  In addition, retirees can import up to $10,000 in household goods duty-free, as well as a personal vehicle every two years.  And retirement in Panama has never been easier.  Recent legislation has expanded its residency program to include individuals who may seek employment upon relocation, at least for citizens of the 47 “Specific Countries” on its list.  This change was implemented to counteract the current labor shortage in the country.

Investment Potential

Buying property in both Panama and Ecuador can be a good investment.  Since Ecuador generally offers more affordable options, its homes often have more potential for appreciation.  However, even more advantageous than buying a home is the opportunity to invest in land in some of the more remote areas where expats are only just beginning to develop an interest.  For those savvy enough to get in during the early stages, there’s much money to be made once development begins.

Investing in land won’t get you quite as far in Panama.  Since expat communities there are more established, the lots are more expensive.  You’d best build if you want to turn a profit.  Panama does, however, have a much better rental market than Ecuador and more property management companies to provide assistance.  Properties in Panama consistently experience higher occupancy and rent for a high premium.


While both countries have areas that are safer than others, Panama is definitely the safest overall.  In fact it’s one of the safest in Central America, experiencing less violent crimes in a year than New York City does in a day.  The country also saw the addition of the Tourism Police Force in 1992, which was specifically established to assist tourists in Panama City.  Conversely, Ecuador is plagued with a murder rate of 19 people per every 100,000, four times that of the U.S.  Even more alarming is the fact that much of the country’s violent crime occurs in areas heavily populated by tourists.  Public transportation, especially taxis, are prime targets for criminals. It’s recommended that all taxis be radio-dispatched.  Don’t just hail one on the street.


Panama wins again, with free public education that is a requirement for children ages 6 through 15.  Investments are currently being made into the education system, to increase the number of educated adults in the workforce due to the labor shortage mentioned previously.  Several good private schools also exist, many of which are bilingual.  By stark contrast, Ecuador’s education system is in the bottom 50 world-wide.  While it does have some private school options, most aren’t truly bilingual, only teaching English as a second language.

Things to Do

There is no shortage of activities in either Panama or Ecuador, and we would be hard-pressed to award this category to one country over the other.  Both have options for exploring nature, such as whale or bird watching.  There are also plenty of opportunities for adventure, like hiking or rafting.  No matter what you’re into, you’re sure to find a place to enjoy your favorite hobby or perhaps develop a new one.

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28 thoughts on “Panama vs. Ecuador: Where Is the Best Place to Retire?

  1. John & Tamara Smith

    Hi I’m trying to get my wife to warm up to the idea of retiring in one of the two places.. I was able to get her to go to Alaska, after I had some tourist info mailed & placed it on the coffee table, after a few days of it setting there, she finely picked it up & we were on or way! if you can direct me to & or send some info? I would be grateful for any help.. THANK YOU……….. :John & Tamara Smith Pocatello, Id

    • 2

      We are VERY interested in retiring in your area. We need more info on Panama vs. Nicaragua and Ecuador? My significant other arms to think there is still political unrest there. He thinks they’re are still guerrillas walking around with machine guns! I’ve told him do to the research, but he its the kind that needs a yes or no answer! Can you help?

  2. 3

    I’m looking to retire in Central America and need information about the best place to be. I am 66 yrs old and my wife is 50 and we have a 13 yr. old daughter. I have a pension of about 4000.00 dollars a month. Medical Ins. is important to my wife. I’m concerned mainly with cost and safety.

  3. 5

    I am 19 and am planning on where I would like to move to, out of all my research Ecuador seems to be coming up trumps. I do however, need a job-right now I am studying Music Technology in a prestigious university in the UK (Queens, Belfast, Northern Ireland). This course involves performance, text based programming for musical application (I am working on game design with this) I also compose. So all in all, an area involving composition for tv and film, programming/computer work and even performing (singing, piano, guitar, electronics etc). I of course, will be more than willing to look about other types of jobs as I can’t imagine that there is an incredibly large amount of jobs in these fields. Also, is setting up your own business a possibility over there? I know the public sector has the far majority where I live.

    I am thinking either the Galapagos Islands or La Sierre (Andes Mountains) as these have very stable climates. I have heard that the more touristy parts of Ecuador have quite a high violent crime rate?

    Basically, I would like to know how to manage my education in order to actually make living away possible. Where are the most safe places, and where I should also consider if you have somewhere else you know of? I’m not a fan of humid weather and would prefer weather similar to that of the Galapagos Islands (about 66-99F without being too humid) sun is what I like… I don’t even mind the rain too much (I live in Northern Ireland after all)!

    Pleas e get back to me if you can, it’s better to get an early start 🙂



  4. 6

    Wow, you missed one GREAT BIG difference. City life. Panama City is a sophisticated city, perhaps not world class, but big, bustling and urbane. Ecuador has big towns and Guayaquil, always something of a back water. Quito may be charming — somewhat — but it is decidedly provincial.
    I will always be biased however. I am 6 ft 2in and lived in NYC 25 years and have traveled in 65 countries. Like many people, I used to be young. Ecuador is the only place I have ever been mugged. It was by men leaping on my back, ripping my clothes to find money. This was in UNESCO world heritage areas — tourist areas — with many local people and tourists on the street. No thanks, not ever again.

    • 7

      I don’t think others should base their decision on this, Ecuador is safe and more if you are smart with what you have on you. Cuenca is technically the city that is the best to retire, they shouldn’t mention the whole country in general. I think Cuenca has it all, they even have a big American community where you are sure to find others with your same interests.

  5. 8

    I am six days from my Retirement. So after reading some of the comments especially on
    Ecuador, my main concern is Safety. And this gentleman have help made my decision for me.
    Panama here I come (smile) Thank you.
    Sandra J Wright

    • tropicalgirl

      hi Sandra,
      just read your comment, are you in panama yet? I just want to comment that, you have to be extremely careful in pa. any panamaian can take you to court, and they have a law, if there are 2 panamaian witnesses a verbal agreement is binding. But what they do is lie,, like saying they heard you say you would pay, when you didn’t. Panama is extremely risky, and no fairness. in all car accidents, gringos are at fault. those are the rules.

  6. 10

    My husband and I are retiring this year and are very interested in Panama living. Of course we would only go somewhere that will accept my pets. My cat I know is ok with proper vac and documents. But I do not see anywhere about a parrot. Funny enough, she is a Panamanian parrot (born in Canada). She is banded…can I bring her into the country?

    • 11

      Hey Cheryl thanks for commenting. Our pets are part of our family, arn’t they! We haven’t explored this subject on Viva Tropical (but thanks for the idea!) but a blogger in Panama has posted his experience .. hope it helps you and your winged friend.

  7. 12

    any more info on retiring to ecuador vs panama, and what about carribean coast of honduras,bay islands? Or on the other hand the phillipines or asia? I have traveled alot in latin america and carribean and south america. Thank You Bob Krueger.

  8. Julio C. Tejada

    I’m just ptobably dreaming, but I’ve travelled through Centrl America, with the Panama exception. I am 72 years old, but with mobility problems cause arthritis, and would like to know whch of those teo countries would be rceommended for a person with disabilities; it’s Nicaragua or Panama, thogh I should mention that I was born in El Salvador, but during the last 43 years I’ve lived in Canada (Alberta and Ontario). I would like to get your input on health, standard of living, safety, and what are the chances they can let me in cause the actual health problems.

  9. 15

    Ecuador or Panama? I have thought long and hard about both of these popular retirement mecas. My suggestion is to visit both places each for a few months, then decide. I think I would lean a little more towards Panama, as it tends to be a safer place to live. Both places have wonderful cultures and people.

  10. 16

    Seriously interested in more information on Panama, and the potential to continue playing golf. I am a very healthy 77 years young.

  11. 17

    Hello, people!
    My name is Ilya and I was born in St. Petersburg, Russia, but now I am the US citizen.
    I am very friendly guy, speak fluently english, russian, german and playing piano. Love jokes, red vine, beautiful women and people with good sense of humor.
    I have two my own kids and adapted thee boys, so total are five.
    I have a great very beautiful wife. For some reason we got very disappointed with US life style and are thinking to move to Panama, Ecuador or Colombia.
    We are nice good looking people and would like to contribute some good qualities to the countries we will be moving in. It will be only two of us.
    We need to make the decision between Panama, Colombia or Ecuador.. Can you please help?
    We are planning to open small business and would like to live in the safe beautiful city with approximately 1 mln people population, with great malls, restaurants, more or less english speaking people,nice boutiques stores,
    and great quality of life. Like Manhattan, but much cheaper, because we can not efford it.
    I am 58 and my wive is 42 yo.and WE DO NOT SPEAK SPANISH.
    What would be your recommendation, PLEASE BE VERY HONEST!!
    By all means I will find the way to thank you !

  12. 18

    Panama and golf can I get some info?

  13. 20

    Hello Viva Team, what are your thoughts regarding retiring in Ecuador and the effect the current political unrest will have on the foreign retired population? I have always wanted to retire in that country however, given the current political climate, I am now having some apprehension. Your opinion is appreciated.

  14. 21

    Panama absolutely does not have lower crime that New York City. Murder rate Panama in 2012,17.2 per 100,000 people. New York City in 2014, 2.2 per 100,000 people. While I was visiting Boquete, Panama last year two European girls disappeared and were never seen again. I have lived in many countries and spent many years in Mexico, for foreigners Mexico is safer than Panama. Please give the correct info. Lives are at stake.

  15. 22

    I am a BSN , currently working in INDIA , also an Indian. I wish to migrate ecuador for a better professional career. Is it good for me??

    please give me your valuable suggestions….

  16. Marcelino.Farro

    I was in Ecuador in 2006 and i was amazed whit Ecuador ,and planting to live there when am start my Retirement in 7 more year, am single looking forward to settle down ,Work as a IT for the GOV , i Studying computer technician Cooltechniek and Electrical and I can speak four languages Dutch, English ,Spanish and Papiamento native languages am form Aruba ,next year am going to Ecuador to strat my plans buy a piece of land a build a house ,

  17. 24

    I am planning to go to Panama to finish my book in May, 2016. I am traveling with one or two girlfriends. We plan on staying a minimum of two months and a maximum of 6 months. Is there any information re: renting properties (houses/apartments) for this length of time that is very inexpensive? What is your recommendation between Panama and Ecuador

    • 25

      Victoria, I am also moving to Panama soon to finish my book! Just sold my proposal. Coincidence! Totally look me up, contact me. I’m not sure if I can leave my email address here, but just google my name, jason harrington, and my Twitter and website and email and everything pops right up.

    • 26

      Ecuador is better, you only have to be in the right city… Cuenca is a excellent opcion and have a big comunity of americans… Have a good security Cuenca too.

  18. 27

    LookinLooking into Panama in the next year . family of three wife and infant daughter retired military unsure if Panama or Puerta vallarta was my choice. I love the Panama retired discounts and benefits as well as the hospitals, still looking for more on PV outside of the beauriful marinas and beaches cheap condos but dont know much as far as safety healthcare schools and benefits if any.

  19. 28

    I was curious to read about the differences. One thing that was not mentioned was the high cost of electricity in Panama. It’s very hot and humid and most North Americans want a/c, but it will cost you $200 to $300 per month to run it in a small area like a condo.
    In Ecuador if you live in the mountains you won’t need a/c
    Since the earthquake in the spring Ecuador is looking like less of a place where I would want to retire

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