The cost of living in cities in Portugal is comparable to other countries in the EU and perhaps cheaper than some, including London.

And, as usual, it is far cheaper to live away from the city and in the more rural areas. In Portugal, the rule of thumb is that the further north you go, the cheaper it gets – except, of course, near the northern cities!

Food
To reduce everyday costs, it is always best to buy fresh produce and seasonal fruit and vegetables. Street markets are popular all over the country with fresh produce straight from the farms. It is also cheaper in Portugal to buy things like peas, carrots, cabbages, potatoes, mandarins, oranges, pears, apples and other produce in season rather than growing them yourself at home! If you are in a rural area you will find that you are soon accepted into the community and, when farmers have extra fruit or vegetables, it gets shared out with the neighbours – that means YOU!

Meat products like beef, lamb and pork are moderately priced just like poultry and eggs. Pork is a very popular meat in Portugal – yay – my favourite Portuguese dish is Pork and Clams! Portugal also makes several varieties of cheese and these are available at very affordable prices. Fish is too if you are buying it from local fishermen; sardines are only 1 euro a kilo in season (2 euros a kilo the rest of the year) and often dorado (sea bream) and the local sea bass can be bought for 1 to 2 euros per fish. Trout from the river can be caught for next to nothing too and then frozen.

Bread and fish can be delivered to your door early each morning; a family I read about gets a large wholemeal long loaf, 4 rolls and a baguette 5 days a week delivered for 21 euros a month.

Non-imported goods, including food and alcohol such as wine is always cheaper. However, with clothing the opposite is true: locally made clothing is of a high quality but is more costly than market-sold (and probably Chinese made) goods.

Medical Care
You are entitled to free State health care in Portugal but if you decide to take private care then it costs. There are a number of providers and costs vary. There is the Portuguese health insurance provider called Tranquilidade who offer Portuguese private health care cover at a reasonable cost I believe. Dental plans can be inexpensively added to this and there is International cover included as well, for when you are travelling.

Schooling
When it comes to schooling, you have the option of free (if you are legally and registered resident in Portugal) State schooling from the age of 6, plus superb state run pre-schooling from 3 months old if required. Portugal views pre-schooling as a service to parents to allow them to continue working and contributing to the economy.

Cars and electrical goods
At the moment, cars are much more expensive in Portugal than they are in neighbouring Spain because of a luxury tax. Evidently, because the Portuguese people are notorious tax dodgers, the government has applied this luxury tax to goods not deemed essential. To my horror I learn that this includes TVs…How can they say that is not essential…I told you I am a telly addict, didn’t I?

However, I believe you can nip next door to Spain for a TV which you can use in Portugal under EU law. But cars are different as they have to be registered in Portugal and this is not encouraged, in fact it’s made so difficult as to be not worth it. The good news however is that this will be changing by mid 2010 latest to comply with EU regulations.

Utilities
This is what an ex-pat says about utilities:

“We cook mostly using propane gas (replacement cylinders) which are delivered to our house for 18 to 19 euros each per 11 Kg tank (11Kg being the weight of the propane not including the tank); I think we use around one tank a month or just longer. Mains water costs us 55 euros per quarter (3 months), except when we fill our large swimming pool up in late May / early June (costs about 25 euros extra). Our rates / land tax / house tax / council tax costs us 316 euros per year. Our electricity bill during the summer (highest cost period as we use air conditioning and certainly use pool plus irrigation motors) is 175 euros per month.”

Wages for helpers like cleaners and gardeners is relatively inexpensive.

This article was written by Overseas Guides Company. Get your free Portugal Buying Guide here.