8 questions to answer before moving to Portugal from the USA

Learn about moving to Portugal from the US, from choosing the right visa and budgeting to where you can find American expat communities in Portugal.

Ivandzhelin

5 minute read

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7 Aug 2024

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Moving

Considering moving to Portugal from the USA? To help you make a decision, we’ll answer the 8 essential questions about living in Portugal as an American. Discover all you need to know, from the types of visas US citizens can apply for to which are the best Portuguese cities for American expats.

Yes, US citizens can live in Portugal for under 90 days without a visa. But if you want to live in Portugal for more than 3 months, you need a Portuguese visa and a residence permit.

To move to Portugal from the USA, Americans can apply for a variety of visas, depending on the purpose of their stay. Here are the most popular visas for Americans:

• Student visa: There are 2 types of Portuguese student visas, a short-term student visa and a long-term student visa.
• Work visa (D1 visa): You can apply for several types of work visas in Portugal including a skilled worker visa, EU Blue Card, Highly-qualified worker visa, and a Tech visa.
• Startup visa (D2 visa): Perfect for American citizens wanting to start a business in Portugal.
• Digital nomad visa (D8 visa): For those who work remotely or freelance, and make a minimum income of €3,040 ($3,243) monthly.
• Passive income visa (D7 visa): For US citizens earning a passive income in their home country through investments, dividends, or retirement benefits.
• Golden visa: If you plan on investing €250,000 ($266,663) in Portugal’s economy through real estate, investments in business, or funding cultural heritage programs

You need to apply for a residence permit only if you plan on moving to Portugal for more than 1 year. This permit allows you to live and work in the country. Check out our guide to Portuguese residence permits to learn more about the application process, costs, where you can apply.

A single person moving to Portugal from the US will need $7,000, including shipping, visa costs, plane tickets, and the first month’s rent and expenses. Depending on whether you’re moving with your family, these costs can double or triple.

Let’s say you’re moving from New York to Lisbon by yourself, your expenses will look something like this:

• Shipping: $355 — $1,230
• Flights: $324 — $460
• Visa fee: €80 ($85.68)
• First month’s rent and security deposit: $2,500 — $4,000
• Living expenses: $643
• Total: $3,907 — $6,418

If you’re moving from the US with a lot of luggage, you need to get a Certificado de Bagagem from the Portuguese Consulate. This allows you to transport your luggage. You must include an inventory of your possessions and proof that you own the expensive items.

There are over 10,000 American expats in Portugal, so you'll meet fellow Americans regardless of which city you live in. But the majority of the American expat communities are concentrated in the bigger cities like Lisbon and Porto or further south in the Algarve area. You can join these expat communities on Facebook, Reddit, or other social media forums.

These cities are attractive to Americans moving to Portugal because of their size, amenities, job opportunities, and high quality of life. As they’re bigger, you’ll also get by with only English initially. But if you plan on permanently living in Portugal, you should learn Portuguese as it will improve your experience.

Looking at the cost of living in Portugal vs. the cost of living in the US, it’s clear that the European country is cheaper than the US. On average, living expenses in Portugal, including rent, are $1,445 monthly. In the US, the monthly costs are almost 40% higher. This means that the monthly cost of living in Portugal is roughly the same as rent for a 1-bedroom apartment in the US.

One thing to keep in mind is that while the cost of living in Portugal is lower than in the US, so are the salaries. The average salary in Portugal is $2,934 monthly, whereas it’s $6,600 for full-time workers in the US.

The best banks in Portugal for Americans are Millenium BCP, ActivoBank, and Revolut. These 3 offer the best conditions to foreigners and have a long list of international clients. Millenium BCP is a favorite amongst foreigners. ActivoBank is an affordable online bank with low fees and interest rates. Revolut is widely available worldwide, making managing your money easier.

If you choose to use any of the 3 banks, you’ll need to open a Portuguese bank account. While it will make your life easier, opening a bank account isn’t required when moving from the US to Portugal. Some American banks like Citibank, Chase, and Bank of New York have branches in Portugal. So, if you’re a client of any of them, it’s best to call your local branch and ask about the conditions.

If you choose to open a Portuguese bank account, you should keep in mind that you’ll probably need to do that in person once you’ve moved there and that some banks might not offer services to American citizens due to banking laws.

American citizens pay taxes in Portugal if they’re considered Portuguese residents for tax purposes. Generally, to be considered a Portuguese resident for tax purposes, you need to reside in Portugal for more than 183 days per year. So, if you work in Portugal, you’ll pay domestic taxes only on Portuguese-earned income.

Aside from filing Portuguese taxes, as an American citizen, you’ll need to file US taxes too. Fortunately, Portugal and the US have a dual-tax treaty, ensuring you won’t be taxed twice on the same income. Besides this, the US offers several provisions to be exempted from paying American taxes on foreign income:

• Foreign tax credit (FTC): exempts you from paying American taxes on Portuguese-earned income
• Foreign-earned income exclusion (FEIE): you can deduct up to $120,000 from your Portuguese-earned income when calculating your US-taxable income.

Check out our guide on taxes in Portugal to learn how to pay taxes, which forms you need, and the deadlines for submitting them.

Having healthcare coverage is mandatory in Portugal and you can pick from public and private healthcare. As a US citizen, you can sign up for public and private healthcare and get public or private health insurance.

Luckily, health costs are much cheaper in Portugal than in the US. Public health insurance is free for Portuguese residents. However, you might have to pay a small fee between $5 and $22 when receiving medical care. Private health insurance in Portugal quotes vary between $43 and $110 monthly, depending on the coverage you want.

Similarly to the dual tax agreement, Portugal and the US have a totalization agreement that exempts American citizens from paying social security contributions in both countries. Based on this agreement, you can pay the US or Portugal social security tax. If you choose to do both or aren’t exempt from one, you can combine the benefits and add them to your retirement.

Yes, moving to Portugal from the US is worth it. The European country has an affordable cost of living, excellent weather, and offers many tax and healthcare benefits to US citizens. Over 10,000 Americans already live in Portugal. So what are you waiting for? It’s time to start exploring homes for rent in Lisbon, Porto, or the Algarve!