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Making a Home Abroad:
Retirement in Puerto Rico

Flag of Puerto Rico
Retire to Puerto Rico - Information and Advice for Retirement Planning, Renting Real Estate, Retirement Activity, Leisure Activity, Jobs for Seniors, Retirement and Real Estate Purchases, Investment for Retirees, Taxes Madicare, Health Services, Sports, Companionship and Dating, Spirituality and much more.

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A very short History of Puerto Rico
Map of Puerto Ricp Puerto Rico's official name is THE COMMONWEALTH OF PUERTO RICO It is an island located in the Caribbean Sea, about 1,000 miles east-southeast of Miami, Fla. A Spanish speaking possession of the United States, it consists of the island of Puerto Rico plus the adjacent islets of Vieques, Culebra,
and Mona. The island has a mountainous, tropical ecosystem with very little flat land and few mineral resources. Originally settled by various aboriginal people, the island was claimed by the Spanish Crown in 1493 following CHRISTOPHER COLUMBUS' second voyage to the Americas. Thus, is was conquered, some time before Europeans permanently set foot on the US mainland. Puerto Rico's still existing oldest buildings date back almost to the first European settlers.

The Spanish Empire ruled Puerto Rico for 405 years, introduced African slave labor and exterminated, through diseases the indigenous population. In 1898, when Spain lost the Spanish-American War, Puerto Rica became a territory of the U.S.A. and Puerto Ricans became US citizens in 1917. Though, self government was only given to the island in the constitution of 1952. In popular votes the island's population repeatedly (in 1967,1993 and 1998) decided to maintain the status quo and not to become a State of the Union.


The People and the Government of Puerto Rico
There are 3.966 million Spanish speaking Puerto Ricans with a low average age of only 36.2 years. Most of them, are of Spanish origin (76.2%) with significant black (6.9%) and mixed race (4.4%) minorities. There are also small Asian (0.3%) and Amerindian groups (0.2%)and a significant group of South American and European immigrants (12.0%) with various racial, but mainly white, backgrounds. About 85% of the population is Catholic. The first dioceses in the Americas was erected in Puerto Rico in 1511. The rest of the population belongs to various small Protestant groups and there are small minorities of Moslems and Jews (mainly immigrants from Europe in the 1930's and Cuba after 1958). 95% of the population is literate.

The Head of State is the President of the United States Government, represented on the island by the executive, the Head of the Government of Puerto Rico, the Governor. The legislative is bi-cameral, with an Upper House, a Senate of 27 members and a Lower House, the House of Representatives with 51 members. Both legislative chambers are elected by universal suffrage for four years. The minimum voting age is 18.

The legal system is based on the Napoleonic Spanish Civil Code, but is within the US Federal System of Justice. There is a Supreme Court, a Court of Appeal, a Superior Court and a Municipal Court. Judges are appointed by the Governor with the scrutiny and consent of the Senate.

The island is administered through 78 municipalities (municipio). Municipalities are further subdivided into barrios, and those into sectors. Each municipality has a mayor and a municipal legislature elected for four year terms. The first municipality (previously called "town") of Puerto Rico, San Juan, was founded in 1521. In the 16th century two more municipalities were established, Coamo (1570) and San Germán (1570). Three more municipalities were established in the 17th century. These were Arecibo (1614), Aguada (1692) and Ponce (1692).


Geography, the Economy and Transport in Puerto Rico
The total area of Puerto Rico is 13,790 sq. km (5,320 sq. mi), of this 8,870 sq. km (3,420 sq. mi) is land. The highest point of the island is at 1,339 meters (about 4,390 feet) above sea level. Puerto Rico has 17 lakes, all man-made, and more than 50 rivers, most originating in the Cordillera Central. The many small rivers
Beach in Puerto Rico and the high central mountains ensure much of the land is well watered The South coast is relatively dry, while the fertile coastal plain belt is in the North. Despite that, arable land makes up less than 4% of the total land available.

Puerto Rico's has a mild tropical marine climate, with little seasonal variations.

It has suffered, in some areas from seasonal droughts, causing water shortages from time to time.

By comparison with other Caribbean States, Puerto Rico is quite industrialized. But, despite a well educated population, industrialization has not brought much prosperity to the island. Unemployment is high, and job expectations are low. There was little investment into industries that deliver to the local market (food processing etc), and most goods are imported. One of the reasons for this is that almost all distributive and food processing trades are dominated by companies from the US mainland, such as K-Mart or Wal-Mart.

Economic pressures are the main reason for emigration. Although, external investment in capital-intensive industries such as petrochemicals, pharmaceuticals and technology have created some jobs, more recent globalization trends, with companies moving to lower wage areas in Latin America and Asia, have led to the loss of many jobs.

Most of the population, over 90% live in urban areas. While immigration to the island has been important in the 18th, 19th and 20th Century, emigration, especially into the New York, New Jersey, Massachusetts and Florida has been significant. It is said that more people of Puerto Rican descent now live in New York and Florida than on the island itself.

Economic migration to the U.S. mainland started a long time before globalization was even a recognized term. Large families and generally low pay, were the main reasons for the migration. Though, Puerto Rico is classified as a high income country by the World Bank, Puerto Ricans had a median household income of only $17,741 in 2007. By comparison, the poorest state of the Union, Mississippi, had a median household income of $36,338 in 2007.

Repeated financial government crisis, most recently in 2006, and continued government debt problems ($46 billion in 2008), have not helped. Tourism brings in some money, but large scale tourism is really limited to day trippers coming in with the large cruise ships. This, despite the fact, that the island has great beaches, good golf courses, outstanding food, even better music and fabulous hotels.

Transport, especially by air, to and from Puerto Rico via San Juan is frequent, good and, relatively, cheap. Though, the public transport system within the country, apart from the public bus transit system and a metro system within San Juan is almost non existent. There is a good system of roads and express ways, but no public transport to speak of, not even privately managed overland buses, outside the capital.


Retirement, Real Estate and living in Puerto Rico
Puerto Rico is a fantastic and beautiful island in the Caribbean and, one would think, it is, therefore, ideally suited as some kind of retirement paradise. Agreed, many of the island's inhabitants are poor and there are areas of high crime. The murder rate in the country is staggering, given the 4 million population, and petty theft is rampant. But apart from that, the people in Puerto Rico are generally friendly. There are the usual hang-outs, or Ghetto's, for Anglos, who do not speak any Spanish and never intend to learn it. That is a great pity! Because, without Spanish, you will only experience a small part of the rich and colorful Puerto Rican life.

Puerto Rico does not offer Retired Persons Incentive Programs, as they exist in some other Latin American countries. If you want to retire in Puerto Rico, you have to do find out everything by yourself, and this is not easy. Even on the internet, information is scarce, apart from lots of opinions in blogs and some rather vague ideas.

From our own investigations and from many visits to the island over several years, we have determined that you really need as a minimum about $2,500- $3,000 per month to have a halfway decent life. And we are not talking about luxury! Housing, water, gas and electricity are very expensive and $1,000 to $1,200 rental per month for a rather mediocre two bedroom apartment, in a "more-or- less" safe area, is really the minimum rent. Utilities will easily eat up another $500 per month. Which does not leave much for living and enjoying life. You can live somewhat cheaper in more remote areas, but that implies, you will have your own transportation.

Some food is expensive, since almost everything processed is imported. If you can cook yourself, you are a bit better off, because you can go to markets and buy fruits and vegetable. But we were struck (we have visited quite a number of indigenous sellers of fruits and vegetables) by the low quality of these products. This is a tropical Caribbean country, where there is an abundance of greenery and one would have thought, that fresh produce is of a similar high quality as for instance in Italy or Spain or Mexico. But this is not the case. Nevertheless, if you can really cook, there are raw materials with which you can do something delicious and presentable. If you do not want to cook, the food in restaurants is generally good and not too expensive.

Many of the non-local retirees in Puerto Rico are sports fanatics. If you are a scuba diver, or a potholer (cave explorer), a golfer, or into ecotourism of all sorts, there is plenty to do. Though, unless you have your own transport, gas (petrol) is cheap here, either with a scooter or a car, you will have great difficulties, to get to these places. Public transport outside San Juan does not exist!

Properties, if you want to buy something, especially outside the major urban centers, can be quite good value for money. It is important though, that you look for solid well built properties, that have hurricane proof construction. If you look around, you can find nice villas with 2 to 3 acres for around $400,000. These would be within an hour or two drive of San Juan or any of the other cities.

Naturally, you can also have condo's in areas like Rincon or similar.The advantages of living in an area like Rincon is that you have many possibilities for trips to coffee plantations, spectacular mountain drives, mini rainforests, the Rio Camuy Cave Park, Cabo Rojo’s salt flats, Phosphorescent Bay in LaParguera as well as sports opportunities such as golfing, 35 minutes north in Aguadilla. There is even a casino 20 minutes south in Mayagüez.

In addition, you will feel at home, since within twenty minutes, you find Western Plaza with a Sam’s Club, K-Mart, Home Depot, and a modern movie theater with ten screens and stadium seating (the movies are in English with Spanish sub-titles). Ten more minutes down the four lane road is the Mayaguez Mall where you will find Sears, J.C. Penney's, Marshall's and Wal-Mart, among others.

Getting to Rincon has been made easier with flights into Aguadilla (30 minutes away) on Continental, Jet Blue and other North American airlines from certain east coast cities in the US. You can also drive from San Juan in 2-3 hours on, mostly, expressway and four lane roads.

Although, buying property here is relatively easy, compared to other locations in the Caribbean, there can be problems with titles and inheritance laws. It is highly recommended that you find a reputable, experienced real estate broker to guide you through this process.

Titles, Deeds and Land Records

Land records are available through the Registros de la Propiedad. There are 29 offices that serve specific municipalities, neighborhoods or sectors. To obtain information from these records, it is usually necessary to know the name of the seller, the approximate date of the original purchase and the city in which the land was then located.

To obtain certified copies write to

Registro de la Propiedad
Oficina de la Directora Administrativa,
Departamento de Justicia,
Piso 3, Calle Olimpo, Esq. Axtmayer, Pda.
11, Miramar, Puerto Rico
P.O. Box 9020192,
San Juan, Puerto Rico 00902-0192,

Social Security, Medicare and Health Care in
Puerto Rico
Puerto Rico is a self governing United States territory and all your social security benefits will be paid in Puerto Rico as they are paid in other States.

Similarly, Medicare offers the same benefit that you would have, anywhere else in the USA.

The Medicare Health and Drug Plans in Puerto Rico (2009) covers the following

29 Medicare Prescription Drug Plans (PDPs) available
77% of people with Medicare have prescription drug coverage (including 69% with Part D)
2% of people with Part D get Extra Help (also called the low-income subsidy, or LIS)
100% of people with Medicare have access to a MA plan for a $0 premium
100% of people with Medicare have access to a MA plan with maximum out-of-pocket cost limit less than or equal to $3,400
13 PDPs have $0 deductibles
$1.50 is the lowest monthly premium for a PDP
$39.40 is the lowest monthly premium for a PDP with any generic coverage in the Coverage Gap
0 PDPs have a premium of $0 for people who qualify for Extra Help
Plan costs and coverage change each year, so all people with Medicare should check to make sure their plan still meets their needs and budget. There may be a Medicare health or drug plan available with better coverage or a lower deductible in 2010.

Source: MEDICARE (2009)


Taxation in Puerto Rico
Puerto Rico is a self governing United States territory and imposes its own taxes. It means, if you become a resident of Puerto Rico, you do not file a tax return with the IRS, but instead with the Puerto Rican Tax Authorities.

Although, the Puerto Rican tax system is modeled after the U.S. system, there are differences in law and tax rates.

The Puerto Rico tax system is based on self-assessment. Taxes are paid to the state. In addition, a premium tax is paid to the Social Security. Individual taxpayers are required to file an annual income tax return when minimum-income thresholds are met. They report taxable income and deductions, compare their final tax liability to any income tax withheld or estimated tax paid, and determine any balance due or overpayment of tax due from the Treasury.

Currently (2009/2010), the income tax rates for residents are

Up to US$1,000 7%
US$1,000 – US$8,500 10% on band over US$1,000
US$8,500 – US$15,000 15% on band over US$8,500
US$15,000 – US$25,000 28% on band over US$15,000
Over US$25,000 33% on all income over US$25,000
Source: Global Property Guide
Up to US$2,000 7%
US$2,000 – US$17,000 10% on band over US$2,000
US$17,000 – US$30,000 15% on band over US$17,000
US$30,000 – US$50,000 28% on band over US$30,000
Over US$50,000 33% on all income over US$50,000
Source: Global Property Guide

For information about the filing taxes in Puerto Rico contact the Bureau of Income Tax at the following address or at their web site:

Departmento de Hacienda
P.O. Box 9024140, San Juan, P.R. 00902-4140
Tel: (787) 721-2020

Despite the fact, that both Spanish and English are the official languages of the island, you have to look for the English part of that web site
Other Taxes
Puerto Rico has a 5.5% sales tax. Municipalities have the option of imposing an additional municipal sales tax of up to 1.5% (effective on November 15, 2006). In addition, in the event that the governor determines an insufficiency in collections for the general fund an additional 1% to the central government will be imposed.
All imports are subject to a local excise tax. Merchandise and/or articles arriving from the U.S. that will be sold, consumed, given away, and/or remain in Puerto Rico are subject to a 6.6% Puerto Rico excise tax that is calculated from the commercial invoice value. This is payable upon entry to Puerto Rico.
Property Tax : Real property is subject on an annual real property tax levied on the property’s market value. The Commonwealth imposes a flat rate of 1.03% with an additional 1% for personal property (effective rate of 2.03% for personal property) and 3% for real property or land (effective rate of 4.03% for real property or land).

Source: Departmento de Hacienda

Please make sure, that the above rates are still current by contacting and getting the latest information from a tax attorney or the respective government offices. senectutis does not accept any responsibility, for decisions you are making based on the above information. See our Terms of Use.

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Despite all the difficulties, Puerto Rico is a charming island with very friendly people. Life is a lot slower there than on the U.S. mainland and for that, it is an ideal retirement place. Medical services in the rural areas are quite rudimentary, we would therefore recommend that you only consider moving there permanently, if you are free of medical ailments. But, if you want a bit of adventure, have enough money, and do not mind occassional short comings, are not paranoid about crime, it is certainly a place to consider for retirement.

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