Located between Argentina and Brazil, Uruguay is the second smallest country in South America, spanning only 68,039 square miles. While it may be small in size, this coastal country is a big hit with retirees from around the globe. In fact, International Living magazine ranked Uruguay in the "top 20" of the world’s best places to retire in 2020.

It’s really no wonder why Uruguay is such a popular retirement destination. This culturally vibrant country boasts a stable economy, mild climate, stunning south Atlantic Ocean beaches, affordable health care, safe drinking water, low taxes, and very little crime. Unlike many Latin American countries, Uruguay also offers modern, top-notch, infrastructure—including well-maintained highways, good public transportation, and one of the fastest Internet speeds in Latin America.

Unfortunately, amenities and services come with a cost: Uruguay isn’t the most affordable retirement destination in Latin America. Even so, it is possible to make a home there without breaking the bank. According to some estimates, the average retired couple could live comfortably in this South American country for around $3,000 a month. 

Key Takeaways

  • Uruguay has been ranked as one of the world's best 20 places to retire.
  • While Uruguay is not the least expensive retirement destination in Latin America, it is possible for a retired couple to live comfortably in Uruguay for around $3,000 a month.
  • The cost of living in Uruguay depends greatly on location; beach resort towns and the capital of Montevideo are more expensive than Uruguay's countryside towns.
  • Uruguay's low crime rate and good health care also make it attractive for retirees.

Everyday Living Expenses in Uruguay

While most items cost a good bit less in Uruguay than they do in the United States, your dollar won’t stretch quite as far as it would in some other Latin American countries. According to Numbeo, a database of user-contributed info about cities and countries worldwide, a meal at an inexpensive restaurant in Uruguay will run you about $8.93, as of March 24, 2020. A gallon of milk costs $2.37 and a dozen eggs is $1.79. A pair of jeans costs around $63.24 and a movie ticket is priced around $7.06. The rent for a three-bedroom apartment in the center of a town will run you an average of $685 a month, while a three-bedroom apartment in the suburbs usually costs about $546 a month.

To become a resident retiree of Uruguay, you'll need to pass a criminal background check and show around $1,500 a month per person in retirement income.

Great Locations for Beach Living

But of course, these numbers can vary, depending on where you settle and the lifestyle you adopt. As with any country, Uruguay is home to a wide array of cities, some with a higher cost of living than others. For example, Montevideo was ranked as the third most expensive city in Latin America in 2018 by consulting company Mercer.

Located about 300 miles up the Río de la Plata from Montevideo, Salto is the second-largest city in Uruguay. Although many consider it a smaller version of Uruguay’s capital, Salto has a much lower cost of living. According to some estimates, a single retiree could live in Salto for as little as $1,000 a month.

Punta del Este, a ritzy beach resort known as Uruguay's answer to St. Tropez, carries a relatively high price tag, as vacation spots tend to do. Renting a three-bedroom apartment in this sophisticated coastal town averages around $818 per month. 

However, cost of living is much lower in Uruguay’s countryside towns, such as Mercedes, and even in the less fashionable beach communities, such as Atlántida and Piriápolis. La Barra is another popular seaside spot.

A Robust Health Plan for Expats

For American expats, the phenomenally low cost of health care is perhaps the greatest financial benefit of retiring in Uruguay. Because the country has a national system with absolutely no restrictions, everyone in the country is entitled to quality medical treatment—even foreign residents.

Expats in Uruguay can also sign up for a private hospital plan called a “mutualista.” With this type of healthcare plan, you become a member of a hospital and go there for all your needs and scheduled services. You pay a monthly membership fee to the mutualista and also owe a small co-pay when you see a doctor. The membership fee typically ranges from $100-$150 a month, and co-pays run around $7.

The Bottom Line

With a temperate climate, gorgeous scenery, lively culture, friendly people, and low crime rates, Uruguay is an absolute dream-come-true for many American retirees. While it's among the world's cheapest and safest retirement countries, this desirable country does have a higher cost of living than many other Latin American lands.

As you determine how much money you’ll need to retire in Uruguay, take a few factors into consideration. Your cost of living will vary greatly depending not only on where you choose to live but also on how you choose to live. Your cost of living will also be affected by the exchange rate of the U.S. dollar against the Uruguayan peso, which fluctuates frequently (as of March 24, 2020, it's about 45 pesos per dollar). All things considered, it is entirely feasible for a single retiree to live in Uruguay on just $2,000 a month—maybe less, if you stick to a shoestring budget and stay away from big cities and fashionable resort areas.