Panama (Panama City)
Cost of Living & Local Currency Guide for American Expats in Panama City, Panama
Panama City is one of the most popular destinations for American expats in Central America. Known for its modern skyline, vibrant culture, and strong ties with the United States, it offers a mix of affordability, convenience, and international community living. If you’re considering relocating, understanding the cost of living and local currency will help you plan your new lifestyle.
- Understanding the Local Currency
- Currency: Panama officially uses the U.S. Dollar (USD) alongside the Panamanian Balboa (PAB). The Balboa is pegged 1:1 to the U.S. Dollar. In practice, you’ll use USD for nearly all transactions, while coins may be in Balboas.
- Banking: Panama has a highly developed banking system. Expats can open accounts with both local and international banks.
- ATMs & Payments: ATMs are widely available, and most businesses accept credit/debit cards. However, it’s wise to keep small bills for taxis, markets, and street vendors.
- Pro Tip for Expats: Since Panama uses USD, you won’t lose money on exchange rates when transferring funds from U.S. accounts.
- Housing & Utilities Costs in Panama City
Housing is often the biggest expense for expats. Panama City offers everything from luxury high-rise apartments with ocean views to more modest suburban homes.
- 1-Bedroom Apartment (City Center): $800–$1,500/month
- 1-Bedroom Apartment (Outside Center): $600–$900/month
- 3-Bedroom Apartment (City Center): $1,600–$2,500/month
- Utilities (electricity, water, trash, internet): $150–$250/month (electricity is higher if A/C is used heavily)
- Comparison to U.S.: Rent in Panama City is generally 40–60% cheaper than in major U.S. cities like New York or Miami.
- Food & Dining
Food costs vary depending on whether you shop at local markets or high-end supermarkets catering to expats.
Groceries (local markets):
- Milk (1 liter): $1.50
- Bread (loaf): $2.00
- Chicken (1 lb): $2.25
- Fruits/vegetables (local): Affordable, often cheaper than in the U.S.
Restaurants:
- Local meal at a fonda: $4–$7
- Mid-range restaurant (for two): $35–$60
- Coffee at a café: $2.50–$4
Pro Tip: Shopping at local mercados will cut your grocery bill significantly compared to expat-oriented supermarkets.
- Transportation
- Panama City offers modern and affordable transportation options.
- Metro fare: $0.35 per ride
- Bus fare: $0.25–$0.50
- Taxi (within the city): $3–$8 depending on distance
- Uber/DiDi: Widely available, usually cheaper than taxis
- Gasoline: Around $3.50–$4.00 per gallon
- Comparison to U.S.: Public transportation is much cheaper in Panama, while car ownership costs are somewhat similar.
- Healthcare Costs
Panama has both public and private healthcare systems. Private hospitals in Panama City are high-quality and more affordable than U.S. care.
- General doctor visit: $25–$50
- Specialist appointment: $50–$80
- Dental cleaning: $40–$60
- Private health insurance: $100–$250/month (varies by age and coverage)
- Pro Tip: Many expats pay out-of-pocket for routine medical care because it’s affordable, reserving insurance for emergencies.
- Lifestyle & Entertainment
Panama City has a vibrant social and entertainment scene, from rooftop bars to world-class shopping malls.
- Gym membership: $40–$80/month
- Movie ticket: $5–$8
- Nightlife (club entry + drinks): $20–$50
- Cultural events/concerts: $20–$100 depending on the show
- Estimated Monthly Budgets for Expats in Panama City
- Single Expat (modest lifestyle): $1,500–$2,000/month
- Couple (comfortable lifestyle): $2,500–$3,500/month
- Family of Four (comfortable lifestyle): $3,500–$5,000/month
- This includes housing, food, utilities, healthcare, transportation, and leisure.
Money-Saving Tips for Expats
- Take advantage of local discounts through Panama’s “Pensionado Program” if you qualify (retirees get discounts on travel, dining, healthcare, and entertainment).
- Rent long-term instead of short-term to avoid seasonal price hikes.
- Shop at local markets for fresh produce and seafood instead of expat-oriented supermarkets.
- Use the metro and bus system for affordable daily commuting.
Final Thoughts
Living in Panama City offers American expats the best of both worlds: the convenience of using U.S. Dollars and a cost of living significantly lower than in the U.S. While rent and dining in upscale neighborhoods may approach U.S. prices, day-to-day living expenses—transportation, healthcare, and local food—make Panama an affordable and attractive expat destination.