Expats are running away to Panama—they’re enjoying a better quality of life for 40% less than back home

According to a new Expat Insider survey, Panama is the best place in the world for expats, for a second year running.

The study measured a total of 10,085 expats, representing 172 nationalities living in 46 destinations across five categories: working abroad, personal finance, quality of life, expat essentials, and ease of settling in. And Panama placed in the top three for every single category. 

In fact, a staggering 94% of expats there report being happy with their life abroad. On top of that, the overall cost of living in Panama for a single person is 36.3% lower than in the U.S. 

The U.S., on the other hand, didn’t even make the top 10 or 20—instead, it was at 36. 

How much it costs to live comfortably in Panama 

With an income of about $800 to $1,500 per month, you could live comfortably in small towns, villages and farming communities, according to reports from Global Citizens Solutions. If you go closer towards the capital, Panama City, it gets more pricey–expats are recommended to have at least $2,500. 

Still, in comparison to major U.S. hubs like New York or Los Angeles, it’s a lot cheaper. The average cost of rent in New York City is a staggering $5,242, according to RentCafe. 

This affordability is one reason why so many expats choose Panama to kick up their feet. The survey of respondents found that 35% were already retired, compared to the global amount of 11%. Nearly 20% of expats said retiring was the main reason for moving there. 

Another one of the biggest wins was quality of life, where it ranked number three. 

Within the country, travel is easy for expats, public transportation is affordable and the natural environment is stellar. There are also several options to dine out, and recreational sports, perfectly fit for those passing time in retirement. 

The best 10 ranked as follows 

• Panama
• Colombia
• Mexico
• Thailand
• Vietnam
• China
• UAE
• Indonesia
• Spain
• Malaysia

Coming in at number two for expats was Columbia, up from 5th place in 2024. The main reason was affordability. 

With a strong rating in personal finance, 81% of expats were satisfied with their financial situation. Although 57% aren’t engaged in paid work, 92% say they have enough to live comfortably. Expats also praised Colombia’s social environment, affordable housing, and friendly locals.

Meanwhile, Mexico took spot number three for its strong community feel. Expats reported feeling welcome and at home, with over a third saying most of their friends are locals. 

Affordable living and strong personal finances make it an attractive choice, especially for retirees, who make up 31% of expats, nearly triple the global average. While work-related reasons drive many to move, job satisfaction is slightly above average, and 39% of expats say they plan to stay in Mexico for good. 

Expats and retirees shouldn’t underestimate a new life abroad  

As many of these exotic destinations become appealing for outside expats, experts advise that moving to a whole new country should not be taken lightly.  

Especially for those retiring, recent shifts in visa rules, tax policies, and local costs mean the process is more complex than you’d think. A successful retirement or move overseas requires careful planning, thorough research, and flexibility to navigate evolving financial, legal, and lifestyle challenges.

For example, retirees moving abroad should understand tax implications to avoid double taxation, factor in exchange rate risks, confirm their financial institutions can support them overseas, and plan for healthcare costs, since Medicare typically doesn’t apply. They should also prepare for cultural adjustments and language barriers—renting for 6–12 months first can help ensure the destination truly fits their lifestyle before making permanent decisions.

Calling all expats: Fortune wants to hear from you. Why did you move and is it everything you hoped for? Contact: jessica.coacci@fortune.com