Life In Costa Rica

It’s Not What You Think…

Anytime I start writing about living in Costa Rica, someone always asks me the same questions — is it really cheaper to live here, how much does it actually cost, and why is it different than what I read online? Unfortunately for them, it’s a yes and no depending on where you live, what you buy, and how long you’ve been here. I’m here to talk about the costs that are particular to Monteverde (and not found in “Costa Rica cost of living” articles): the mountain tax, the gringo tax, and what you can actually afford in comparison to where you’re coming from.

Cost of Living in Costa Rica: Not as Cheap as it Seems

Many people who come to Costa Rica do so under the assumption that it’s an inexpensive place to be and that they’ll be able to stretch their budget out much farther than they ever could back home. This is unfortunately not the case for many, and in particular for those settled in the mountains. While Costa Rica is, in part, significantly cheaper than many countries surrounding it, it is not the cheap island paradise as many make it out to be. Generally speaking, an expat in Costa Rica should budget somewhere between 1600 USD and 2200 USD per month for a single person, and another 1600-2500 USD for each additional person, depending on if they’re attending international schools or not — and that’s if you’re settling in a nice area with all the amenities.

On the contrary, what Costa Rica offers as payment for your hard-earned money is a stable, healthy environment with excellent healthcare and a great quality of life.

Mountain Tax: The Higher You Climb, the Harder it Hits

If there’s one thing that differentiates Monteverde from other popular destinations in Costa Rica, it’s the mountain tax. While Costa Rica’s average cost of living is significantly higher than that of most of its neighbors, Monteverde offers its own unique twist due to its remote location. The roads here are not as developed, many are gravel, and to get to the nearest store you’d have to traverse up a mountain. It shows in the prices: local stores here tend to charge significantly more for the same products as their equivalents in the capital due to the distance and the logistics of getting it here.

That’s why the girls at the local PriceSmart in San Carlos became my best friends. The local mountain tax makes things significantly harder and more expensive, which is why many who live here take advantage of the opportunity to stock up on supplies when they can. Shopping in larger quantities at a more distant store is actually part of the Costa Rica budget for many who live in remote areas. Anything imported or specially ordered will also see a significant price increase due to being in Monteverde. If there’s one thing I learned about the cost of living in Costa Rica, it’s that most things will cost more than you’re used to paying in other parts of the country — and even more so if you’re in Monteverde.

Gringo Tax: How First Impressions Affect Your Budget

One thing many gringos (a colloquial term for white foreigners in Costa Rica) tend to notice when being a new expat in Costa Rica is that things seem to cost more when bought by them than by locals. This is commonly referred to as the gringo tax, and while it’s completely unofficial (and hard to prove), it does exist and is definitely something to take into account when budgeting. It’s most evident in things that don’t have a specific, official price that everyone has to pay, so it’s found most often in taxis, local markets, and various other places that deal exclusively with cash. It’s actually much less of a problem in big-box stores, restaurants, and other businesses dealing with tourists.

On the flip side, however, the longer you live somewhere, the less of a “gringo” you are, and the lower your costs will be. Once you start being recognized and treated as a local (as I was in Monteverde after a few months of near-daily visits), many of these invisible price increases will disappear. In many ways, it’s another reason why the Costa Rica cost of living for expats is so much higher during the first few months than later on.

Cost of Living in Costa Rica: What’s Cheaper Than at Home

What you can buy cheaper here compared to the States or Europe includes: