Panama's Pensionado Program

Panama has put together the most appealing program of special benefits for retirees you’ll find anywhere in the world today…and the program is open to foreigners.

In Panama, resident pensionados or retirees are entitled to:

  • 50% off entertainment anywhere in the country (movies, theaters, concerts, sporting events)
  • 30% off bus, boat, and train fares
  • 25% off airline tickets
  • 25% off monthly energy bills
  • 30% to 50% off hotel stays
  • 15% off hospital bills*

Plus a lot more perks.

*Unless insurance applies.

If you choose to obtain residency in Panama via the Pensionado Program, you’ll also be entitled to a one-time exemption of duties on the importation of household goods (up to $10,000) and tax exemptions every two years on the importation of a car (or, better yet, the local purchase of a car).

Plus, you cannot arbitrarily lose Pensionado status. Though in other countries, new laws have affected the status of long-time retirees, sometimes stripping away their residency, Panama’s government has kept its pledge to grandfather in Pensionado residents. That means that even if future laws change the Pensionado requirements, your status will never change!

So how do you become a member of the oh-so-fortunate Pensionado elite? It’s easier than you think. Let’s start with some of the basics:

  • You must draw a pension of at least $1,000 per month to qualify.
  • You are not required to buy real estate in Panama to qualify.
  • Foreigners who obtain residency via the Pensionado Program are protected from changes in the law, in effect allowing them to maintain residency in perpetuity.
  • Foreigners on Pensionado status are not entitled to apply for Panamanian citizenship.

By the way, you can enjoy Panama’s great Pensionado discounts no matter which residency permit you have. Legal permanent residents of Panama age 60 and over for men and 55 and over for women may ask for the discounts, even if they are not Pensionados. (This does not include tax exemptions for importation of household goods or car, but it does include tax exemption on the local purchase of a car.)

* Note that you can apply for the Pensionado visa even if you have yet to reach the above ages. The government reviews applications on a case-by-case basis, and if you’ve begun receiving your pension early (because of disability or any other valid reason) you are welcome to apply, no matter what your age.

Friendly Nations Visa

Officially named the Permanent Residence for Nationals of Specific Countries, this visa opens the door for professionals and entrepreneurs from 47 countries that “maintain friendly, professional, economic, and investment relationships” with Panama, which includes the U.S. and Canada.

The visa requires you to open a local bank account with a minimum balance of $5,000, as well as doing one of the following:

  • purchase real estate, with a minimum required investment of $10,000;
  • open a business;
  • find employment in Panama.

Forestry Investor Visa

The forestry investor visa encourages the production and preservation of teak. Basically, the program consists of two options, dubbed the small forestry investor and the large forestry investor visas. The small forestry investor visa requires a minimum investment of $60,000, whereas the large forestry investor visa requires a minimum investment of $80,000.

The Small Forestry Investor option has some significant drawbacks:

  • It doesn’t grant you permanent residency after two to three years, like the other permits mentioned here.
  • It is a temporary resident permit, and you must spend more time and money to re-apply every year for six years.
  • Only on the seventh application will you be able to apply for permanent residency.

The Large Forestry Investor visa is granted provisionally for two years. After that, you may renew and apply for a permanent residency permit. Five years after obtaining permanent residency, you may apply for Panamanian citizenship.

If you have a different type of investment in mind, note that Panama offers many different visa alternatives; those listed above represent just a few of the more popular options.

For more information on the Forestry Investment visas and potential profits on this investment, contact Robert Kroesen of United Nature.

Professional Residence Permit

This option is open to foreigners who would like to work in Panama, provided they do not choose professions reserved for Panamanian nationals (examples include medical professions, accounting, real estate, and law).

Applicants must have a university education, and unlike other visas, must make two applications, two years apart. When filing the final application, applicants must show that they have been employed in Panama for the last nine months and have been paying local social security.

Tourist Visa

If you are from the U.S. or Canada you do not need a visa for tourist visits of up to 90 days. Tourists may stay for up to 90 days and, in general, extensions are not available unless you can prove you need more time because you are changing your status from that of tourist…for example, if you entered Panama as a tourist and then decided to apply for residency.

Panama’s Easy Residence Options

by Jessica Ramesch

In my early years writing for International Living, I researched most of the countries drawing expats today. The different options for residence always caught my eye. One country welcomed retirees with a special visa. But the fine print? “Foreigners can own construction, but not the land it is built on.”

Another country offered 10-year visas, but not permanent residence. (And you had to show a monthly income of over $3,000.) Yet another had a worrisome track record: it changed its retiree residence program and failed to grandfather in existing members. Meaning a large group of expats was suddenly living abroad sans legal status.

Now, no visa is perfect. Virtually any residence program is going to take some time and patience…there will be paperwork to file and fees to pay. But all are not created equal. And it’s precisely in the “residence programs” category that Panama outshines its rivals.

If you’re from the U.S. or Canada, you won’t need a visa to visit for up to 90 days. (And there are others on the visa waiver list, as Panama maintains friendly relations with a long list of countries.) Panama even issues free travel insurance to visiting tourists.

But if you’re interested in making it permanent, you’re sure to find a residence option that meets your needs. Panama is best known for its Pensionado or Pensioner Residence Program. If you have a lifetime pension of at least $1,000 a month, you can apply for permanent residence. The program also entitles pension-holding retirees to a long list of discounts…and I’m talking across the board. From medical expenses to entertainment, retirees in Panama can seriously stretch their dollars.

The most important point about the Pensionado: the government has pledged to allow residents to keep their status, even if the rules change further on down the line. A promise Panama kept when, about five years ago, it made changes to the program.

Expats of all ages are being welcomed these days, so no worries if you’re not quite ready to retire. Panama’s newest residence options include a program for nationals of more than 40 countries that are on good terms with Panama. Known as the “Friends of Panama” visa, it doesn’t ask for hundreds of thousands of dollars in “investments.” Requirements are straightforward and include a local bank account with a balance of at least $5,000. You must also do one of the following: buy real estate, start a business, or get a job here.

The Friends of Panama program is one of the world’s least expensive. But if even that’s too rich for your blood, there’s another Professional Resident option that welcomes college grads to Panama. That’s right, you must have a degree—at least a Bachelor’s or equivalent—in order to apply. You must also hold down a job here, in any of a variety of professions (excluding those reserved for nationals, such as brokering real estate,).

There are other programs, too. A good Panamanian attorney—well versed in immigration law—can help you choose the best option for you. In some cases you can have your legal residence in as little as six months (from time of application). And you can stay in Panama while your application is being processed, if you wish.

Of course ease of obtaining residence won’t have any bearing on whether or not you’ll actually be happy in your adopted country.

If you daydream about sunshine, tropical beaches, and welcoming locals, then possibly Panama is for you. If you know yourself well…and you know you don’t do well without modern amenities, then Panama is probably for you. And if you consider a solid, growing economy and stable, business-friendly government to be essential to a free and happy life, then Panama may be a perfect fit.

The country has beaten out neighbors time and time again, topping indexes for everything from its excellent Internet and cellular coverage to its rock solid infrastructure. If all that sounds good to you, maybe add “visit Panama” to your New Year’s resolutions. (And picture yourself on the beach this time next year.)