Much of Costa Rica’s appeal for Americans is that living expenses here are supposedly a lot lower than in the U.S. When our income ended after the top of the real estate bubble in 2005, we moved here thinking we’d save a bundle.
While it is true that some things are less expensive, fresh produce or the services of a plumber or gardener, for instance, many things are actually more expensive. Additionally, we live in the suburbs of a big city here, where the cost of living is higher than it is in the countryside.
Rice and beans are cheap, but meat and fish cost about the same here as they do in the U.S. Restaurant dining is about the same as well, and heavily taxed.
Owning a car in Costa Rica is much more expensive than it is in the U.S. Gas is over $4 a gallon. Cars themselves are about double the price of similar models in the U.S. The rough roads batter car suspensions into junk in short order. Drivers spend a lot of time sitting in traffic jams.
There is probably some savings to be had on clothing, if you don’t buy imports. And the climate is so uniformly pleasant, you don’t really need much in the way of clothing.
Housing is very cheap if you are content with the Costa Rican standard in housing, which is small and simple. If your taste runs to hot water at every sink, modern electric and plumbing design and granite counter tops, housing is comparable in cost to that in typical American cities.
For all of that, however, our family lives here for less than half of what we spent to live in the U.S. I feel like we live as well as we did in Key West.
The explanation, I find, is not that the cost of living here is so much less, it is that we live a much simpler life here. Here we only have one car, no boat, no vacation home, no expensive hobbies. No airplane. Airplane???!!! Yeah, an airplane.
To demonstrate that even normally level headed guys like this writer are not immune to the silliest delusions of never ending prosperity, at the height of the madness, I thought I could afford an airplane. I couldn’t, of course. But I had a wonderful time wearing my lampshade hat and dancing on the table. Luckily Hurricane Wilma brought me to my senses by wrecking the plane. I took it as a sign from God.
Here in Costa Rica, having practically no income, our family has rediscovered what had for us been a forgotten skill, that of making ends meet. Our ends had been so far apart and for so long they probably wouldn’t have recognized each other if they had met.
We are trying to reacquaint them now. We’re conducting the introductions in Spanish in hope that the relationship will flourish on the charm of a romance language and pure novelty.
It occurs to me that many of you in the Homeland may be considering similar introductions. I recommend this simple formula as presented recently by the writers at Saturday Night Live.
Don’t Buy Stuff You Cannot Afford
[open on couple trying to balance their checkbook ]
Wife: (sighs) I just can’t get these numbers to add up.
Husband: Like we’re never going to get out of this hole.
Wife: Credit card debt, does it ever end?
Chris Parnell (CP): [walks in] Maybe I can help.
Husband: We sure could use it.
Wife: We’ve tried debt consolidation companies.
Husband: We’ve even taken out loans to help make payments.
CP: Well, you’re not the only ones. Did you know that millions of Americans live with debt they cannot control? That’s why I developed this unique new program for managing your debt. It’s called [presents book] "Don’t Buy Stuff You Cannot Afford."
Wife: Let me see that… [grabs book, reads] "If you don’t have any money, you should not buy anything." Hmm, sounds interesting
Husband: Sounds confusing.
Wife: I don’t know honey, this makes a lot of sense. There’s a whole section here on how to buy expensive things using money you save.
Husband: Give me that… [grabs book, looks at it] And where would you get this saved money?
CP: I tell you where and how in Chapter 3.
Wife: Ok, so what if I want something but I don’t’ have any money
CP: You don’t buy it.
Husband: Well let’s say I don’t have enough money to buy something. Should I buy it anyways?
Husband: Now I’m really confused!
CP: It’s a little confusing at first.
Wife: Well what if you have the money, can you buy something?
Wife: Now take the money away. Same story?
CP: Nope. You shouldn’t buy stuff when you don’t have the money.
Husband: I think I got it. I buy something I want, and then hope that I can pay for it right?
CP: No. You make sure you have money, then you buy it.
Husband: Oh, THEN you buy it. But shouldn’t you buy it before you have the money?
Wife: Why not?
CP: It’s in the book. It’s only one page long. The advice is priceless and the book is free.
Wife: Well, I like the sound of that.
Husband: Yeah, we can put it on our credit card.
CP: [shakes head]
Announcer: So get out of debt now, write for your free copy of "Don’t Buy Stuff You Cannot Afford." If you buy now you’ll also receive, "Seriously, If You Don’t Have the Money, Don’t Buy It!" Along with a 12-month subscription to "Stop Buying Stuff Magazine." So order today!
You can watch the video at:
It seems like it should, but somehow I doubt it. All the players who have protected markets have arranged for a continuation of the protection for five, ten or more years before anything changes. And I have no idea what the gov would do to pick up the slack. They certainly wouldn’t get away with taxing the local stuff. Income taxes here are still a joke, as they should be. I expect inflation will be the easiest solution, and it’s what they know best.
Will CAFTA reduce the retail prices of US imports? If so, how will CR replace the lost income?