I’m lucky that I was able to pay for my flat in cash here in Santiago de Compostela, Spain. Therefore I have no mortgage payments and don’t have to pay for extra property insurance and life insurance which are mandatory in Spain when you take on a mortgage.
Spain can be a cheap country to live in. But, of course, you can also live lavishly in other cities, such as Madrid, Barcelona, and Valencia. Rent, transportation, and entertainment can really kill your budget in those cities.
In this post I wanted to talk about my household spending in Spain and compare it to living in Portland, Oregon.
Household Spending in Spain
In the US, most Americans will have the following items in their household spending categories:
- housing (rent, mortgage, HOA, property taxes)
- transportation (car payments, insurance, repair, gas)
- food (groceries, eating out)
- healthcare (insurance, office visits, medications)
- entertainment (TV, socializing, gym membership, travel)
- utilities (home utilities, cell phone)
In the Spain it’s a little different. I’ll only write about what I’ve observed in my city, Santiago de Compostela. Barcelona, Seville, and Madrid can be a little more like US cities since there is more wealth there.
In Spain I have the following spending categories:
- housing (HOA, property taxes)
- food (groceries)
- entertainment (gym)
- utilities (water, electricity, cell phone, Wifi)
1. Housing (€32/mo)
I bought this flat in cash, €90,000. I don’t have any mortgage or major property taxes.
My HOA dues (community fees) are about €25/mo. Annual property taxes are €86/year. This includes property insurance.
2. Transportation (€0)
I don’t need a car since SDC is small and is well connected with a bus and train system. My transportation costs are therefore $0.
I ended up buying an electric Brompton which was an unnecessary expense. I spent €3,000 on it, which about half of my annual household spending in Spain.
3. Food (€230/mo)
Groceries are cheap in SDC. There is a daily farmer’s market which is cheaper than the grocery stores. I can eat well for €200/mo in groceries.
Dining out is inexpensive, as well. My friends and I dined at a fancy restaurant for €41 which included drinks, 3 main dishes, and lots of Galician bread. Not bad for 3 people.
My friends here spend far less than me on groceries. For a single dude it’s easy to get by on €90/month.
4. Healthcare (€55/mo)
I pay €55/mo which is mandatory since I’m not a permanent resident of Spain. With my non-lucrative visa I’m considered a temporary resident.
I get access to both private and public care, from what I understand. I haven’t had to use it yet but will report back on that when I do.
5. Entertainment (€70/mo)
People here are rather social. But they get together at a bar for a drink and that usually comes with a healthy portion of tapas. So the cost of socializing isn’t high.
I have a gym membership which is €45/mo. That’s the extent of my entertainment, which is probably a bit more boring than the average person’s.
6. Utilities (€116/mo)
My prepaid cell plan is €10/mo. I also pay €31/mo for my home Wifi.
Water and electricity come out to around €75/mo. Electricity is €0.15/kWh here – on par with Portland, Oregon.
Total Monthly Household Spending (€503)
My monthly household spending in Spain comes out to around €500/month. This isn’t me being frugal – I still have the gym membership, the dining out, organic produce, and private health insurance
But it also doesn’t include random costs such as dental care, home repair, replacing a cell phone, clothes, travel, etc.
My household spending in Spain has a very low burn-rate which is ideal for someone who is pursuing a new career or needs a break from the spending/earning hamster wheel. More importantly, there is room to save in case I hit a dry spell.
500 euros converts to $575/month. I could earn this money by investing $230,000 in the market. My conservative index fund investing strategy should easily net me 3% annually.
If not from investments, I could earn this from renting out my Portland condo which is currently sitting empty. The going rate for my pad would be around $1,200/month and it’s paid off.
Household Spending in Portland
The lowest I could get my household spending in the US was around $1,000/month – realistically, $1,500.
Now, I didn’t make the move for the cost alone. It was also a decision for a better quality of life, to learn a new language, and to learn to practice medicine in a different system.
Housing would be my biggest expense in the US, even with the paid off condo. That’s because of property taxes and HOA dues. Here, my biggest expense is groceries.
According to Numbeo, cost of living in Portland is about 2x as high as in SDC.
Working in Spain
I am earning my income as a digital nomad physician these days. I haven’t yet tapped into my investment income.
If I choose to practice medicine here in Spain, I should be able to earn around €3,000/month. It’s not a lot but neither is my household spending here in Spain.
I’m maybe among the few my age who own a paid-off house in Spain. This allows me to spend less than my peers. Which means that I would have a competitive advantage if I wanted to do something like open a cafe or a residential contracting business.