Cost of Living

Portugal remains the most affordable country in Western Europe for expats. While prices — particularly rent — have risen significantly since 2020, the overall cost of living still compares favorably to comparable European capitals. Day-to-day expenses (food, transport, entertainment) are notably cheaper than UK, Germany, France, or the Netherlands.

Rent is the biggest cost driver for expats in Portugal. Prices have risen significantly in Lisbon and, to a lesser extent, Porto and the Algarve. Lisbon center is now expensive by Western European standards; Porto and the Algarve remain more affordable. All prices below are for furnished apartments with utilities not included.

You'll need a Portuguese bank account for your residence application, to pay rent and utilities, and for day-to-day life. Several banks have internationalized their account-opening process, allowing non-residents to open accounts remotely with a NIF number. ATMs are ubiquitous — Multibanco is Portugal's universal ATM and payment network.

Portugal taxes residents on worldwide income at progressive rates. The favorable NHR regime (Non-Habitual Resident) that once attracted many expats was effectively closed to new applicants in 2024, replaced by a narrower IFICI regime targeting qualified professionals in innovation sectors. Most expats now navigate the standard Portuguese IRS system.

Moving large sums to Portugal (for property purchase, living expenses, or D7 visa proof) requires cost-effective transfer methods. Traditional bank SWIFT transfers are slow and expensive. Modern transfer services have made international money movement dramatically cheaper and faster.