Comparing Panama And Colombia: Living, Retiring, And Investing

Which Is Better—Panama Or Colombia?

Last Friday, I addressed a group of Oxford Club members convened here in Panama City in the meeting rooms of the Trump Tower to talk about diversifying beyond U.S. borders.

Longtime friends Julia Guth and Karim Rahemtulla had brought their Oxford Club group to town not only for the Friday seminar, but also to board a cruise ship headed through the Panama Canal and then on to Cartagena, Colombia.

Two of the world’s top retirement, lifestyle, and investment havens up close back to back.

My job Friday morning was to compare and contrast these two markets. While they both have so much to offer right now, Panama and Colombia couldn’t be more different.

We’ve been alerting you to the opportunities on offer in these countries for years. I first recommended Panama for retirement and investment more than 15 years ago, and we began heartily endorsing Colombia, specifically Medellín, more than 8 years ago. My conversation with the Oxford Club members on Friday, though, helped remind me why we continue to be as bullish as we are in both cases.

I laid things out concisely…

Panama And Colombia Pros and Cons

Panama Pros

  • World’s top offshore haven
  • Bona-fide tax haven, taxing income on a jurisdictional basis
  • Uses U.S. dollar
  • Specific Countries visa program (which can mean a work permit)
  • Best infrastructure in Central America
  • Strong economy
  • Quality, affordable health care
  • Diverse lifestyle options, including Pacific and Caribbean coasts, islands, mountains, and Panama City
  • Top choice for entrepreneurs
  • Super accessible, with many direct flights daily to and from North America and Europe

Panama Cons

  • Hot and humid in Panama City and on coasts
  • Traffic congestion in Panama City
  • Poor service standards
  • Panama City not suitable for walking
  • Mañana attitude

Colombia Pros

  • Top investment haven with enormous upside
  • Best health care in Latin America at a cost that can be 90% less than U.S. costs for comparable care
  • Politically stable
  • Strong economy
  • Welcoming locals
  • First World, even luxury lifestyles
  • Working hard to compete for foreign attention
  • Easiest and cheapest residency option in the world today; pensioner option requires income of only US$630 per month at today’s exchange rate… and, unlike in Panama, where an attorney is required by law, you can process the application yourself
  • Many lifestyle options on offer, including sophisticated, Euro-chic city living, Caribbean beach, world-class colonial towns, rural landscapes, and the finca lifestyle

Colombia Cons

  • Necessary to learn some Spanish
  • Little existing expat infrastructure
  • Not a low-tax jurisdiction
  • Air pollution in Medellín and Bogotá

In the context of the issues most important to the would-be investor or retiree, here’s how these two countries stack up against each other…

Cost Of Living

Panama And Colombia Cost of Living

Remember the exchange rate. Right now, Colombia can be the greater bargain by far.

Cost Of Real Estate

Panama And Colombia Real Estate

Again, remember the exchange rate. Right now, real estate in Colombia can be 60%+ cheaper, apples to apples. Also note that, while it’s possible to own luxury in both Medellín and Panama City, Panama City luxury now comes at a much higher cost.


Panama And Colombia Climate

Way more comfortable in Medellín than Panama City, for example, but both countries offer many different climates

Quality Of Life

Panama And Colombia Quality of life

What are you looking for? Both countries offer city, coastal, mountain, and rural choices.

Ease Of Residency

Panama And Colombia Residency

Again, Colombia today is perhaps the world’s easiest place to establish residency. No lawyer is required, and I’ve known people to go through the process in one hour.

On the other hand, Panama’s Specific Countries visa program is the best option in the world today if you want to work.

Banking And Doing Business

Panama And Colombia Banking

Panama is the clear winner, thanks to:

  • Banking infrastructure
  • Lack of exchange controls
  • No currency risk
  • Much more English spoken
  • Available labor pool and possibility to acquire work permits for non-local labor


Panama And Colombia Infrastructure

A tie.


Panama And Colombia Taxes

Panama is the screaming champion on this score, a true tax haven, while Colombia qualifies as a high-tax jurisdiction, with, for example, a corporate tax rate as high as 33%.

However, if you’re a retiree making a move with retirement income, you probably don’t have to care about this.

Health Care

Panama And Colombia Health Care

Top-quality, international-standard care is available in Panama City. Outside the capital, the standard of care in this country falls.

Five of the top 35 hospitals in all Latin America are in Medellín. Other cities in Colombia have similarly top-standard facilities.

Ease Of Settling In

Panama And Colombia Ease of Settling In

Panama City is a kind of halfway house for expats, a very easy and comfortable first step overseas. Medellín is an emerging expat destination, though more discovered and therefore easier to navigate as an expat or foreign retiree all the time. Bottom line, though, Colombia is more challenging in this regard unless you speak Spanish.

Which Is Right For You?

Panama And Colombia: which is Right for you

Depends on your circumstances, personal preferences, and agendas…

Why Choose?

Live or invest in both.

Kathleen Peddicord



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