Comparing Cost of Living in USA and Nicaragua: It will surprise you!

“Everything costs something.”
Zara Hairston

When we lived in Nicaragua, we occasionally referred to ourselves as economic refugees. We took early retirement and lived off our small teaching pensions. We did everything financial experts advised to prepare for living abroad such as, becoming debt free, having an emergency medical fund, purchasing international health insurance plans, saving money for unexpected emergencies like trips back to the states to help our families, and living within our budget.

Thank goodness we didn’t burn any bridges. We rented our house in the states and kept our stateside bank account and address, which was important in keeping our U.S. credit card.  We were legal residents of Nicaragua and Tennessee and had the best of both worlds.

When the Nicaraguan crisis and Ron’s lumps in his neck made us reconsider moving back to the states, we were concerned about the cost of living after spending more than 10 years abroad with cheap, cheap living and all the comforts of home.

What we learned surprised us!

Most retired expats in Nicaragua will tell you that their main reason for moving abroad was affordability. They said they had a hard time living on a fixed income in their home countries.

But, what they don’t tell you is that everything costs something! It is cheap because there is no quality control, the education system does not prepare employees to be productive and skilled laborers, the infrastructure such as roads, utilities, and internet are pitifully unreliable (and many times unsafe), and most materials and foods imported come with a hefty price tag. In other words, you get what you pay for…and it isn’t much!

So, I made a comparison of the cost of living in Nicaragua and the USA for the month of February. I used eight general categories and color coded them the same in each pie graph.

The monthly cost of living in our home in TN is $1,626.20. The largest slice was miscellaneous, which included paying off our credit card in full each month. We rarely use cash here and pay for almost everything with our credit card. I missed that so much in Nicaragua, because I can always accumulate enough reward points to pay for several airline tickets.

Surprisingly, several items are cheaper in the states, like gasoline for transportation. It is $1.80 per gallon with my grocery store discount card. The package deal for fast internet ( I mean really, really fast…100 mbps) and cable TV is $101.24 a month. I paid much more in Nicaragua for the internet, not including the maintenance of a very tall microwave tower that was always breaking. And…AND…the speed, if we were lucky, was 8 mbps, when the system was working. The internet blinked on and off daily many, many times.

We have a heat pump and several small portable electric room heaters for the winter months. February is usually the most expensive electric bill according to our past usage. In the summer, we have whole house air conditioning and our electricity averages $75. Most of the time we don’t use the air conditioning. We prefer opening the windows and every room has ceiling fans and window fans.

We own our house in TN and are mortgage free. Rents are reasonable in our small town, averaging $871 per month for a 1 bedroom house or apartment. For a single person a monthly cost of living on average is $1,600.


In Nicaragua, our monthly expenditures were  $1,341.00 Our cell phones were cheaper… we had two cell phones and only one with unlimited data from  Claro. The data transmitted was only 3g and service was spotty depending on where we were in Nicaragua. In the states, I have 4g and unlimited data with free calls and text in the U.S., Canada, and Mexico with AT&T prepay.

Transportation was more expensive in Nicaragua for two reasons. Gasoline is very expensive and taxis are expensive. Usually, we took a monthly trip to Managua with our taxi driver, Francisco. The cost round trip was $60 and we tipped him $10 and bought him lunch.

Although we had an abundance of fruits on our property, we enjoyed some imported foods like peanut butter, dill pickles, chocolate, and wine, which increased our monthly food expenditures.

Nicaragua is a cash society. We seldom used a credit card. Our miscellaneous fees included propane for cooking, house repairs, and workers.

We still support our goddaughter and my children’s library and librarian, so that has not changed.


Overall, the difference in monthly costs is about $300. When the weather warms, our electric will go way down and make up much of the difference. We can reduce our monthly internet/cable TV service by cutting the cable cord. The only reason we have cable TV is so Ron could watch his sports throughout the long winter cancer treatments. We can stream everything we want to watch, so the cable will be cut soon.

Our annual expenses are comparable in some areas, and more expensive in others.


1. International health insurance in Nicaragua and Medicare with Medicare supplemental insurance in the U.S.

2. VPN service for our internet remains the same.

3. Amazon Prime yearly bill is the same, but living in the states we have used it so much more for free shipping and streaming movies.

More expensive:

1. Property taxes $650 yearly in the states vs $60 in Nicaragua.

2. Car insurance is much more in the states. We bought and paid cash for a car when we returned…and we have to have car insurance. In Nicaragua, we had our dune buggy and our motorcycle insured for $75 a year. However, there is no telling what the insurance would have covered if we had an accident in Nicaragua.

In making comparisons, the best decisions we made were to pay off our mortgage in the states and buy our house in Nicaragua. Our house is rented in Nicaragua now. The worst case scenario would be that our house in Nicaragua would be confiscated by the government. If that would happen, because of our wise financial decisions, we would not suffer, nor would our retirement  funds be affected. We are not in any hurry to sell our place, nor do we feel pressure to sell. Although we will probably not return to live in Nicaragua, we have no regrets about financial decisions we have made throughout our lives.

It feels kind of weird to say we aren’t expats any longer. But, we are redefining the term expat. Possibly global citizens would be a better term. I’m in the process of writing a post about that. Stay tuned while we rewire.




33 thoughts on “Comparing Cost of Living in USA and Nicaragua: It will surprise you!

  1. You raise a lot of good points Debbie about the economics of living as an expat elsewhere or in the US. When Richard passed away in October, many people asked me if I would continue to live in Portugal or return “home.” Actually, it never really entered my mind to return back to the US as Portugal is home now and I have the support of many friends here. Perhaps another reason is that we moved around the western US states several times during our working lives and, since we sold our house in Texas, I really have no idea where my US home would be. The only way we could retire early (I was 55 at the time) was to leave the US as the health insurance costs (and car & house insurance too) were prohibitive and, at the age of 62, I still have a few years to go to qualify for Medicare.(My health insurance here runs about $50 USD in Portugal.)
    It was interesting to see your comparison and it is surprising to find your cost of living in the US so close to your costs in Ometepe since you both receive Medicare. It isn’t hard to understand why you left Nicaragua since, although for many years Nicaragua was safer than the US, that is no longer the case and there’s no doubt that your return to your home has saved Ron’s life. So there you are, with an amazing life and story to tell of Nicaragua behind you and many paths to choose on ahead while you enjoy some of the luxuries of US living. I wish you both all good things! P.S. I really miss a good Vlasic dill pickle myself! Anita

  2. It seems like you settled back into TN. I hope your husband is recuperating so you two can get back to enjoying your life together. Looking forward to seeing how you are refocusing your blog…an expat’s view of Tennessee culture? 🙂

  3. Hey you; Granada “expat” Gregg Powell here! After 17 years in Nicaragua (and several trips to and around Ometepe) we too are now in the USA – in a similar position/scenario to you and Ron…we are living “right up the road” from you on the “Big River” but/and during the summer school break will be frolicking with our 3 daughters and friends on Lake Cumberland, Dale Hollow and The Tennessee River (Lake Loudon?) in Knoxville…would LOVE to swing by your place and chitty chat, catch up and compare notes,,,it would be BIG FUN…PM ME!!!

    • Hey, you! Lol I know we will have a lot to talk about. When we arrived in the states last July, we bought a car and headed to Canada. Along the way, we stopped to visit many of our transplanted Ometepe neighbors and other friends who had lived in Nicaragua for many years. Our stories were very similar. We all grieved for our loved ones who were unable to leave Nicaragua, and horrified by how quickly our lives were turned upside down. We definitely need to get together to chit chat!

      • I and we have THE SAME here in Cincinnati: we have reunited with other expats – including one super cool gal from Ometepe – Natalie is HERE with us in Cincinnati. She has been and is a fabulous person and has been very kind, thoughtful and generous to myself, my wife and 3 daughters…we all ice skated together down on the river at Christmastime and we all LAUGHED A LOT – with tears of disbelief in our eyes…I too am trying to redefine myself AND…what to do with our property (ies) Nicaragua AND…the future = ???

        It would be absolutely wonderful to rendezvous with you two some day – Tennessee (WHERE R U in TN?) or here in Cincinnati. Meanwhile, take care and…GET WELL Ron!!! ((-;

  4. When we decided not to move to Nicaragua, some Nica friends in the US asked me why that was. The main reason was lack of infrastructure. I could also have cited the manana mindset, which would have driven me crazy!

    I’ve been locked out of WordPress (mainly because I haven’t been on since you were not posting and I’d forgotten my login info), so I couldn’t respond to your previous post. But I wanted to say how sorry I was that you and Ron had to go through all that. My ex survived breast cancer, so I know how traumatic the whole process is. But I hope that Ron continues to do well and I look forward to reading of your adventures in Europe at some point.

    We live in Yorkshire (England), which some people think is pretty much a foreign country, including the language!… perhaps you’ll visit one day.

    • Sandra, thank you so much for the encouragement. Life really threw us curve balls last year, but we were up for the challenge and are making the best of the time Ron needs to heal.
      I know what you mean about the manana attitude, but in this case, it helped us get through challenging times because we have learned to be patient and wait…lol.
      Hugs to you! Who knows, we may travel your way when Ron is stronger. We have never been to Yorkshire.

  5. It is interesting to compare the two. I have tracked every penny(and Cordoba) spent/earned (and found!) for the past 4 years. An being *not* of retirement age, we have always looked for an income source… For us our costs have gone up back in the states, but mainly in the food category. This is mainly due to have a better choice (organic) and a wider variety (healthy snacks and such). We definitely eat “better” than the limited choices allowed in Nicaragua. There is also the comfort level to travel and dine out at a wide variety of places in the states. Shopping is more abundant, and the options nearly unlimited. Keeping ourselves in-check is always important! But even with the increased expense living here, we have also been able to significantly increase our income level. The net? We are net positive every month, and isn’t that the goal?

    • Hola Stephen. It is great to hear from you. Keeping ourselves in check and having the discipline not to buy everything we see or like is hard! There are an abundance of choices. Sometimes I find them overwhelming. I think our financial health is a matter of fine tuning and balancing our wants and needs. Living on a fixed income takes practice. We have little accounts for travel, medical, and emergency and we are always trying to rearrange the money in those accounts depending on our needs. Yep! That’s the goal! Hope to see you in January or before.

  6. Your assessment of living costs on Ometepe confirms my own estimates… we spend a little less because we are not supporting a library. Your costs in Tennessee seem remarkably thrifty. In my last year in Toronto before moving to Nicaragua in 2008 my monthly household costs were over $5,000 CDN a month. The biggest cost increase I’ve seen here in Nicaragua over the past 10 years is food. Many items are now more expensive than in Toronto, and when I go back for family visits I load up on nuts, seeds, and other dried goods. The increase is due to import duties… the government has a huge appetite for tax income… and they sure aren’t spending it on education. We had a cleaning bee at the high school today. My daughter’s classroom does not even have lights. Disgraceful!

    • Hola Chris. Whoa! I had no idea Canada was so expensive. The food in TN is expensive, too. But, it is because TN doesn’t have a state income tax and makes up for it in the state sales tax. Even food is taxed!
      Sorry, but when I read your comment about no hay luz in your daughter’s school, we both couldn’t stop laughing! Pitiful, isn’t it? But, so typical of the schools in Nicaragua.
      Today, I am waiting to video chat with my librarian and the kiddos. He is over an hour late and still no call. I think there is no hay luz in our elementary school either! Sigh!
      Thanks for your comments. Hugs to you and your family!

      • Please don’t gauge all of Canada by Toronto prices. I live in Niagara Falls, Canada, a city of just under 100,000, and my cost of living is far less than $5,000 a month. Just an hour plus drive away from Toronto, and we wonder how people can afford to live in Toronto. I don’t have any firm statistics to quote, but I can assure you that a person can quite comfortably live in most areas of Canada on far less than those in Toronto.

  7. Great comparison of living costs. Generally speaking it actually costs more to be an expat when all costs and quality of life is considered. Of course if you live in some areas of the US it is very expensive but there are many safe, healthy, and economical locations in the southern states.


    • Len, you are right! Considering the quality of life in Nicaragua, our costs here are very comparable. We are fortunate to not only have a home in a state that doesn’t have an income tax, but to live in an absolutely gorgeous area and the oldest town in TN with much history. Thanks for your comments.

  8. Great to hear from you again and that Ron is doing better. Nice article and interesting comparison. Planned to come down to Nice this year but just returned from visiting John and Kerry Jackson who moved to Playa Del Carmen Mexico. Everyone is scattered and hope things improve soon. Best wishes on your adventures! V&M

I'd love to read your ideas and thoughts below....

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.