Everyone seems to agree: the quality of your life improves when you move to Mexico. And a huge part of that is the lower cost of living you’ll enjoy.

Goods and services cost less…so you can afford the kinds of luxuries only the wealthy enjoy in the U.S.—like a maid, a cook, and a gardener. You can find bargain real estate—whether you rent or buy—so your housing costs are drastically reduced. And you can also get high-quality medical care for a fraction of the price back home—including insurance.

In Mexico you have the good fortune of giving up very little when you make your move. You’re heading to a near neighbor where you can get internet, cable TV, and all the other comforts you’re used to in a modern country that still pulses with a vibrant traditional culture. You get the best of both worlds—and you’ll pay much less too.

In general, a typical retired couple can expect to live comfortably in Mexico on about $2,500 a month, all in. This includes a nice home, plenty of dinners out, entertainment, travel, and help around the house.

Cost of living however, does vary slightly depending on where you live. Beach areas and those popular with tourists and expats, like the Riviera Maya, Puerto Vallarta, Los Cabos, or San Miguel de Allende, for example, can be more expensive if you’re not careful. At the beach, you might use air-conditioning, which drives up the electric bill. And there is a temptation to engage in tourist activities, shop in the tourist-oriented shops with imported products, and dine in tourist restaurants, which have higher prices.

Real estate can also be higher in tourist areas. Somewhere to live in the heart of San Miguel’s desirable colonial centro (center) comes at a premium, as does beachfront property in resort areas…although these homes and condos will still be much cheaper than a comparable property in the U.S.

That said, you can still find deals on daily expenses, meals, and even real estate in these places too—it just takes a little knowledge. In San Miguel you can pay much less if you’re willing to walk five minutes to the colonial district. And if you’re willing to live a few blocks from a beach it’s much more affordable too. And there are plenty of restaurants, shops, and more off the tourist trail where you can enjoy even better meals for less. Get to know your neighborhood, shop where the locals shop, and you’ll vastly reduce your expenses every month.

In Mexico, you can afford to indulge. You can buy a house for $200,000—or less. You can employ a maid for about $4 an hour and a gardener for $5 an hour. Pamper yourself with a manicure, pedicure, and haircut…and pay less than $50. Get an hour-long massage on the beach—or in a spa—for $20. Enjoy a top-shelf margarita for $3, with a view of the water to go along with it.

For a small home, you can expect your annual property taxes to come to no more than $200. Your electricity bill will likely cost between $25 to $50 a month (unless you use air-conditioning a lot), gas is about $25 a month, cable TV and high-speed internet (usually bundled together) about $40 a month, and basic telephone service about $20. You can eat out at a nice restaurant for $15 per person, or grab a quick lunch at a local cocina económica for $4 to $7, not to mention a savory taco for just 50 cents. At the grocery store expect to pay $3 for a whole chicken, $2 for fresh caught fish, $2 for a pound of avocados, and 50 cents per pound for tomatoes. It’s cheaper to eat fresh in Mexico—and it allows you to easily adopt a healthier diet too.

The following budget gives you an idea of the expenses a couple might incur each month living comfortably in Mexico. We have included rent—but keep in mind that if you’ve bought your house outright, you won’t have this expense (though you would want to include property taxes—rarely more than $200 per year—and regular maintenance).

 Expense U.S. $
 Housing (rental 2-BR, furnished) $750
Utilities $150
 Groceries $350
 Entertainment $250
 Healthcare (IMSS/Seguro Popular + meds) $80
 Household help once a week $135
 Incidentals $150
 Monthly Total $1,865