Retiring South of the Border: Why Your Retirement Savings Stretch Further in Mexico Than North America

The Retirement Math That Doesn’t Add Up in the U.S.

American workers face a retirement paradox. A 2024 Charles Schwab study revealed that typical participants expect $1.8 million to retire comfortably—yet the average retirement account sits at just $491,022. That gap between expectations and reality has prompted millions of North Americans to explore alternatives beyond their home countries.

Mexico has emerged as the leading destination, offering a cost of living roughly 61% lower than the U.S., according to recent data from LivingCost.org. For those doing the math, this means retirement savings stretch significantly further. The per-person yearly living expenses in Mexico average $978 monthly, compared to $2,504 in the U.S.—a crucial distinction when budgeting for decades of retirement.

Housing: Where the Real Savings Appear

Housing represents the largest retirement expense for most people, and this is where the cost of living mexico vs north america comparison becomes most dramatic.

Rental Markets In Mexico, expect to pay approximately $442 monthly for a one-bedroom rental, while similar accommodations in the U.S. command $1,592—a 260% markup. For retirees living on fixed incomes, this difference alone could determine whether retirement feels financially secure or precarious.

Home Purchases The purchase price gap proves equally striking. Mexican properties range from $100,000-$120,000 for basic homes to $116,000-$232,000 for mid-range residences. U.S. home values average $363,505, with luxury homes reaching $1.3 million+. A retiree’s down payment in Mexico could cover a full property purchase in many regions.

Healthcare Expenditures: A Second Major Win

Healthcare costs represent another pillar of retirement planning, and Mexico offers substantial advantages. International Living data shows medical procedures cost roughly 50% less than U.S. counterparts. Dental implants illustrate this gap: $1,650 in Mexico versus $3,400 in the U.S. A coronary artery bypass costs $27,300 south of the border compared to $73,000 in the U.S.

For Americans under 65 without employer coverage, private insurance premiums reach $986-$1,081 monthly. By contrast, comprehensive health insurance for Americans living in Mexico costs approximately $5,900 annually—just $492 per month. This represents one-fifth the premium typical pre-Medicare Americans pay.

The Social Security Advantage

Here’s where the numbers become particularly compelling for the average retiree. A retired couple receives roughly $48,000 annually in combined Social Security benefits, according to the Social Security Administration. In Mexico, this amount covers approximately two people comfortably, with most estimates suggesting $30,000 annually suffices for a retired couple.

That same $48,000 creates financial strain for a couple in the U.S., where everyday expenses demand the majority of these benefits. In Mexico, Social Security alone provides comfortable living without requiring supplemental income.

Making the Decision

The gap between living cost in mexico compared to the united states has widened enough to dramatically impact retirement outcomes. Workers who accumulated $500,000 in retirement savings face difficult choices domestically but enjoy genuine financial security south of the border. While relocation involves non-financial considerations—cultural adjustment, language, distance from family—the mathematical case for Mexico grows stronger with each passing year of retirement planning uncertainty.