How Much Money Do You Need to Retire in Mexico on a Budget?

Expats would need approximately MXN $15,500 (USD $800) per person to retire in Mexico on a budget. This would include expenses for necessities, groceries, healthcare, and transport, with minimal entertainment, dine-out, and out-of-pocket miscellaneous spending.

Mexico is a popular retirement destination for many, especially Americans. It features pleasant weather, rich culture, friendly locals, and a lower cost of living, making it one of the best countries for retirees from all over the world eager to live a better quality of life in their golden years.

How Do You Calculate the Amount of Money Needed?

money for retirement in Mexico

There are two considerations for expat retirees to understand: the amount of money needed for a seamless transition— the financial requirements to qualify for a residency permit in Mexico—and the cost of living in Mexico, such as daily necessities, groceries, transport, and healthcare.

Financial Requirements for a Residency Permit in Mexico

The financial requirements for a residency permit in Mexico are as follows:

Demonstrate monthly income starting at USD $4,300 and up to $4,500 monthly for the past 6 months. You must provide at least the last six months of bank statements as proof.

Demonstrate a minimum balance in investments or savings of USD $180,000 for the last 12 months. You must provide bank statements over the past year as proof.

Proof of home ownership in Mexico is valued at 40,000 x Daily Minimum Wage (MXN $9,957,200 in 2024, or approx. $553,000 USD).

The above demonstrated the three methods to qualify for a residency permit in Mexico. If your pension income is below the requirement, you can instead qualify by satisfying the savings or investment requirements, which should not be an issue for most who have been saving throughout their lives.

Budgeting Tips for Americans

You can start taking Social Security anytime from age 62 to 70. The longer you wait before starting to take those payments, the higher the monthly payouts will be. If you are going for the monthly income route, or just a little bit short in savings, consider what works best for you by doing careful calculations.

The Cost of Living in Mexico

Mexican Food - Taco

For expats moving from countries with a high cost of living, e.g., the U.S., fret not! You can rest assured that Mexico has a considerably low cost of living, that you can purchase daily necessities and groceries, and that you can pay for transport and healthcare inexpensively.

However, it is difficult to conclude everyone’s cost of living with just a number as each individual has a different lifestyle. Some expats are used to spending a lot on luxury dining, while others are just as good with just sticking to the basics.

That said, here are the questions you should ask yourself to help you assess your potential monthly spending.

Where in Mexico do you want to live?

Do you want to buy or rent a home in Mexico?

What would be the utility costs if you were to live in a desired apartment or house?

Do you want to pay for healthcare with insurance premiums or out-of-pocket expenses?

Will you be driving or taking public transport?

Will you need any housekeeping services?

How often do you plan to travel around Mexico to other nearby countries?

How often do you eat out? Are you planning to cook at home for most of your meals?

How many people are in the household? Is there anyone that you are financially supporting?

To help you do the calculation, here we have compiled a list with the cost of specific items that you are likely going to spend money on during your time in Mexico.

Dining Out

Meal, Inexpensive Restaurant: MXN $164 (approx. USD $16)

McMeal at McDonald’s (or Equivalent Combo Meal): MXN $150 (approx. USD $15)

Domestic Beer (0.5-liter draught): MXN $45 (approx. USD $4)

Imported Beer (0.33-liter bottle): MXN $72 (approx. USD $7)

Cappuccino (Regular): MXN $56 (approx. USD $5.50)

Coke/Pepsi (0.33-liter bottle): MXN $22 (approx. USD $2)

Water (0.33-liter bottle): MXN $16 (approx. USD $1.60)

Grocery

Milk (regular), (1 gallon): MXN $100 (approx. USD $10)

Loaf of Fresh White Bread (1 lb): MXN $42 (approx. USD $4)

Chicken Filets (1 lb): MXN $63 (approx. USD $6)

Apples (1 kg): MXN $49 (approx. USD $4.80)

Banana (1 kg): MXN $24 (approx. USD $2.40)

Oranges (1 kg): MXN $30 (approx. USD $3)

Tomato (1 kg): MXN $30 (approx. USD $3)

Potato (1 kg): MXN $35 (approx. USD $3.50)

Onion (1 kg): MXN $30 (approx. USD $3)

Transportation

One-way Ticket (Local Transport): MXN $11 (approx. USD $1.10)

Taxi Start (Normal Tariff): MXN $50 (approx. USD $5)

Gasoline (1 gallon): MXN $90 (approx. USD $9)

Volkswagen Golf 1.4 90 KW Trendline (Or Equivalent New Car): MXN $389,000 (approx. USD $38,000)

Toyota Corolla Sedan 1.6L 97kW Comfort (Or Equivalent New Car): MXN $408,430 (approx. USD $40,000)

Utility

Basic Utilities (Electricity, Heating, Cooling, Water, and Garbage Collection) for a 915 sq ft Apartment: MXN $1,210 (approx. USD $125)

Mobile Phone Monthly Plan with Calls and 10GB+ Data: MXN $433 (approx. USD $42)

Internet (60 Mbps or More, Unlimited Data, Cable/ADSL): MXN $517 (approx. USD $50)

Let Us Help With Your Requirement in Mexico

Mexico

Are you looking to retire in Mexico? Let Pacific Prime help you! The process of relocating and settling down abroad requires thoughtful and thorough preparation.

Mexico features an affordable and laid-back living environment, perfect for retirees from all over the world. While the prospect of retiring in Mexico can be exciting and all, don’t let any unexpected healthcare expenses derail your peace during your retirement years by securing international health insurance.

This is where Pacific Prime is your invaluable partner. Our team of insurance experts has over 20 years of experience in tailoring cost-effective insurance solutions while ensuring adequate coverage to meet the unique needs of expats and retirees in Mexico.

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Eric Chung

Content Creator at Pacific Prime Latin America

Eric is an experienced content writer specializing in writing creative copies of marketing materials including social media posts, advertisements, landing pages, and video scripts.

Since joining Pacific Prime, Eric was exposed to a new world of insurance. Having learned about insurance products extensively, he has taken joy and satisfaction in helping individuals and businesses manage risks and protect themselves against financial loss through the power of words.

Although born and raised in Hong Kong, he spent a quarter of his life living and studying in the UK. He believes his multicultural experience is a great asset in understanding the needs and wants of expats and globe-trotters.

Eric’s strengths lie in his strong research, analytical, and communication skills, obtained through his BA in Linguistics from the University of York and MSc in Teaching English to Speakers of Other Languages (TESOL) from the University of Bristol.

Outside of work, he enjoys some me-time gaming and reading on his own, occasionally going absolutely mental on a night out with friends.

How Much Money Do You Need to Retire in Mexico on a Budget?

How Do You Calculate the Amount of Money Needed?