Retiring in Puerto Rico

2 mins readLast updated March 30, 2023by Kate Morgan

Puerto Rico, a Caribbean island territory of the United States, is a popular retirement destination for many Americans seeking a tropical environment with access to outdoor activities, cultural events, and a lower cost of living. With its beautiful beaches, lush rainforests, and rich cultural heritage, Puerto Rico offers a unique retirement experience that attracts many retirees every year. According to data from the U.S. Census Bureau in 2020, Puerto Rico had a population of approximately 3.3 million people, with over 18% of the population being over the age of 65, making it one of the top destinations with a large retirement population.

What age can you retire in Puerto Rico?

Like many locations, Puerto Rico has no specific retirement age that is mandated by law. This means that individuals are free to retire whenever they choose, as long as they are able to financially support themselves. However, there are some age-related benefits and considerations for retirees in Puerto Rico: 

Why do people retire to Puerto Rico?

  • Tropical environment: Puerto Rico is known for its tropical climate, with warm temperatures year-round and beautiful beaches. Retirees can enjoy living in a tropical environment that offers plenty of opportunities for relaxation and outdoor activities. 

  • Lower cost of living: Puerto Rico's cost of living is generally lower than many states on the mainland, which could be a benefit for retirees on a fixed income. Housing and healthcare costs are generally lower than in many other locations. 

  • Tax benefits: Puerto Rico offers significant tax incentives for retirees, including a 0% tax rate on capital gains, no federal income tax, and a lower cost of living overall. 

  • Rich cultural heritage: Puerto Rico has a rich cultural heritage, with a blend of Spanish, African, and indigenous influences. The island has a vibrant arts and music scene, and hosts several festivals and events throughout the year, including the San Sebastian Street Festival and the Casals Festival.

What puts people off retiring to Puerto Rico?

  • Natural disasters: Puerto Rico is prone to natural disasters such as hurricanes, which could be a concern for retirees living in certain areas. 

  • Language barrier: While English is widely spoken in Puerto Rico, Spanish is the primary language, which could be a challenge for some retirees who are not fluent in the language. 

  • Infrastructure: Some parts of Puerto Rico may have less developed infrastructure compared to mainland locations, which could be a concern for some retirees. 

Best places to retire in Puerto Rico

If Puerto Rico is your chosen retirement state, here are some of the best places to retire in: 

  1. San Juan: As the capital city of Puerto Rico, San Juan offers a unique blend of rich history and modern conveniences. It boasts a vibrant arts and culture scene, with numerous museums, galleries, and music festivals. San Juan is also known for its beautiful beaches, excellent restaurants, and shopping centers. 

  2. Ponce: Located on the southern coast of Puerto Rico, Ponce is a charming city that is often referred to as the "Pearl of the South". It is home to a number of historic landmarks, such as the Ponce Cathedral and the Parque de Bombas. Retirees can enjoy a relaxed lifestyle in Ponce, with easy access to beaches and outdoor activities. 

  3. Rincon: Rincon is a picturesque town located on the western coast of Puerto Rico. It is known for its beautiful beaches, excellent surfing spots, and laid-back atmosphere. Retirees can enjoy a quiet and peaceful lifestyle in Rincon, with plenty of opportunities for outdoor activities such as hiking, swimming, and fishing. 

  4. Dorado: Dorado is a popular retirement destination located on the northern coast of Puerto Rico. It is known for its upscale resorts, golf courses, and beautiful beaches. Retirees can enjoy a luxurious lifestyle in Dorado, with access to world-class amenities and recreational activities. 

  5. Aguadilla: Aguadilla is a small coastal town located in the northwest corner of Puerto Rico. It is known for its beautiful beaches, excellent surfing spots, and natural beauty. Retirees can enjoy a quiet and relaxed lifestyle in Aguadilla, with easy access to outdoor activities such as hiking, fishing, and snorkeling. 

In conclusion, Puerto Rico offers a range of retirement options, with easy access to beaches, a relaxed lifestyle and vibrant culture. Retirees can enjoy a tropical climate all year round and significant tax incentives but should be prepared for language and infrastructure barriers. It's important to seek expert financial advice to weigh up all of the costs associated with retiring in Puerto Rico, including property taxes, insurance, and living expenses, in order to make an informed decision about whether the state is the right choice for your retirement. 

Content writer

Kate Morgan

Kate has written for leading publications and blue chip companies over the last 20 years.