Cost of living in San Miguel

Q: I've heard that I can stretch my retirement dollars in Mexico but that San Miguel is expensive. Which is true?

A: This question, or some variation of it, is probably our most frequently asked FAQ. And the answer, for a number of years now, has stayed pretty much the same. No matter whether your coasting on a generous golden parachute, or relying on government funds to see you through, how far those dollars will take you is entirely up to you.

Let me explain: At the moment, with exchange rates hovering at about $13 USD or $12.5 CND to the Mexican peso you can certainly stretch your dollars in Mexico and even San Miguel, which admittedly is not the cheapest Mexican destination, can be a bargain. It is estimated that you can live, comfortably but not lavishly, in Mexico for significantly less (25-40% less) than it would cost in the U.S. and Canada. In its favor are the lower costs of food, staff and services, medical care and prescriptions and more affordable housing and operating costs.

But on the other hand, goods imported into Mexico are far more expensive than they would be at home; electronics, appliances or automobiles may all command a premium price. In addition, some of Mexico’s main industries are still heavily controlled or monopolized; such things as gasoline, electricity, airfares or telephone service are certainly no bargain.

Now, what makes the difference between saving 25% or saving 40% on your retirement dollars, or spending more than you would at home—that is where you, your expectations and way of life all come in. Obviously, the more in tune you are with the local economy and way of life, the more money you will save. For example; while entrees alone at some of San Miguel’s finer restaurants can cost $15-25 USD, a complete three course lunch at a typical Mexican restaurant is only $7-10 USD. Daily life can be much less expensive than you are accustomed to. You can employ part time help for $2-3 USD an hour, pay your dentist $25 USD a visit and expect to cut your grocery bill by 30 to 40%.

If you are interested in minimizing expenditures, you will find that you can do so with much more ease in San Miguel than you can north of the border. And it doesn’t require doing without treats or cutting corners. The only things required are some common sense, resourcefulness and a willingness to adjust to life as it comes, rather that expect it to be what you are used to north of the border. (why pay premium prices for imported American groceries when local equivalents can be just as good and much more fun to try out)

To live comfortably, a monthly income from $1600 to $2000 for two people is certainly adequate. If you choose, you can live for a bit less—and for quite a bit more. Remember, San Miguel does offers a high standard of amenities and services, and if you wish to take full advantage of them, or entertain lavishly, then your expenses will naturally increase.

In general, you should find the cost of living here less than in Mexico City or resorts such as Puerto Vallarta, on par with other Mexican retirement havens (i.e. Lake Chapala) and more expensive than in colonial cities such Guanajuato that do not attract such a large percentage of expatriates.

The peso has lost a bit over the last months and now stands about 12.9 to the U.S. dollar. Such an odd amount is making it difficult for some to calculate the value of things agaist the dollar. For a quick approximation, just divide the price in pesos by 10, and then give yourself a 20 percent discount. For example, something that costs $120 pesos costs $12 dollars minus 20%, or roughly $9.50 U.S. dollars; not bad for a bottle of Kahlua.
P.S. Mexican pesos are real money, and you will save quite a bit by changing your dollars at a bank and using pesos for all local purchases.