Ecuador is a small country that is often overlooked. Home of the Galapagos, a beautiful place to visit, the mainland has a lot to offer for those interested in living abroad. This little country also uses the US dollar as the official currency.
Despite its small size, this is also one of the most bio-diverse countries on the planet. You will have no shortage of new fruits and vegetables to try along with most all of the staples you are used to. All the food is grown locally and organically too which makes everything far tastier than the food you get at your local grocery store in America. Not to mention, crazy cheap!
The Andes mountains run right through the heart of the country which divides this small tropical country into several very distinct regions.
The coast provides a beautiful coastline that is friendly to surfing, swimming, and more. If you’re looking for cheap, beautiful beach-front property, Ecuador might be the perfect place for you.
The mountains are always cool and in an eternal spring-like state. Many people imagine it must be hot at the equator, but if you’re visiting Quito or Cuenca you might not want to forget to pack a jacket or more depending on where you’re from! The eastern part of the country is located in the Amazon rain-forest and has it’s own climate as well.
Combine all this with a territorial tax system that does not tax foreign income and a reasonably straightforward local tax system, this is one of many Americans favorite places to retire.
Quick Information About Ecuador
Where is Ecuador?
Ecuador is located on the northwestern side of South American, right at the equator, hence the name.
It’s one of the smaller countries, about the size of the state of Arizona, in South America, south of Colombia, north of Peru.
What is the capital of Ecuador?
The capital of Ecuador is Quito, a beautiful city in the mountains, higher than Denver.
Ecuador Population: 17,715,822
Currency: US dollar, $
Who can go to Ecuador?
Ecuador is one of the most open countries and most countries can travel there visa-free. Notably, it is the only country on the continent where Americans (North & South), Russians, AND Chinese all have visa-free access. Even if you can’t get visa-free access, the visa is generally fairly easy to qualify for. The hardest part for many non-westerners will simply be getting a flight there as countries you can fly through will require a visa. Notably, there are flights from Amsterdam to Quito, Ecuador and most anyone should be able to qualify to transfer at the Amsterdam airport as long as you don’t try to leave the airport or have a layover more than 24 hours.
How safe is Ecuador?
Ecuador is one of the safer countries in the Americas. The country ranks over 50 countries safer than the United States according to the Global Peace Index.
There is some petty crime in the large cities such as pick-pocketing, so keep an eye on your belongings in public areas and buses. For the most part the country is pretty safe. There are some pockets with more crime, such as Guayaquil which is probably the most dangerous part of the country where you should exercise additional caution, but you will find the crime rate to be similar to a number of major US cities. It’s also generally advised to be extra cautious around the Colombian border as well.
Top destinations for expats in Ecuador
There are many places for expats in Ecuador. In the mountains there are the cities of Cuenca and the capital of Quito which are both beautiful, always mild weather, and both feel a lot like a European city. This makes sense as they are both some of the oldest colonial cities on the continent. Vilcabamba is a drier and warmer small town in a valley that also seems popular with a number of expats.
The biggest city in Ecuador is Guayaquil, but it is also probably also the most unsafe. This is a great place to go if you need access to big modern malls and all the other modern luxuries plus there are sizable expat populations from many countries here.
Another much smaller but popular city is along the coast, Manta. Manta has a small regional airport (Mostly flights to Quito & Guayaquil), and a modern mall. There is a pretty nice beach right in town, but if you are looking to surf you’ll probably need to commute a little out of the city.
Much the same can be said about the city of Salinas, a few hours south down the coast from Manta. Salinas is only about an hour bus/taxi ride from Guayaquil, so if you plan to head into the big city for some legal or business reasons, Salinas might be preferable. Both Manta and Salinas have a large expat population.
Another similar but smaller one to consider is Playas, which is just further down the coast but also within about an hour range or Guayaquil.
If you’re looking for a small town along the coast, there are a lot of options. Montañita and Olón are perhaps the most popular two particularly along North American & European expats. Montañita is more of a party town, if that’s your vibe, while Olón is quieter and more family friendly. If you’re seeking a party town in the mountains, check out Baños.
If you’re looking for an Amazon rainforest destination, check out Tena, Puyo, or Coca. Coca is warmer and deeper in the Amazon which makes it one of the main destinations for many Amazonian adventures. The other two cities are closer to Quito, higher in elevation, and not as big, but they are also very beautiful places to check out waterfalls and exotic birds with Tena be the larger of the two.
What is the cost of living in Ecuador?
The cost of living in Ecuador is quite low. You can rent a very nice apartment on the beach for about $1000/month. If you’re looking for something cheaper, there are a number of smaller places available for just a few hundred dollars a month depending on what you need. Many expats confirm you can live quite comfortable on $1500-$200. If you wanted to, this is definitely a place you could live on $1000 or less with with some mild effort.
If you’re interested in buying, you can get almost a 1000 square-foot (~93 square meters), two-bedroom apartment for around $50,000-$60,000 in the cities. You can find cheaper property further out of the city with land if you want. For a nicer apartment in the heart of the historic districts you are looking to pay $80,000-$100,000. For around $150,000 you could get a nice condo on the beach or a beautiful home with stunning views in the mountain. There are a lot of choices for such a small country!
Fruits and vegetables in the store are remarkably cheap, you can buy a dozen bananas for $1. Other staples are also quite cheap as well. Foreign goods might be a little more pricey depending on what you are looking for. I rarely go to the store with more than $20 and always get what I need.
Healthcare is also much cheaper, you can receive good quality medical care for a quarter or even a tenth the cost compared to the US even without insurance. Quality of care is best in Quito, Cuenca, and Guayaquil. In many situations your trip to the public hospital could even be free, or maybe you’ll need to pay a dollar or two for some medicine from the pharmacy.
Cabs are very cheap, I pay $1.50 for the taxi to take me to the next town over. ~$20 can get me an hour north or south along the coast. Cleaning service is also quite cheap, you could hire a stay-at-home maid for only a few hundred bucks a month if you wanted.
If you’re a retiree you can also enjoy benefits such as 50% off tickets for sporting or cultural events, pubic (And private) transportation, and even water and electric bills.
The one area you are going to be paying more is electronics. Unfortunately all electronics are subject to tariffs in Ecuador which raises the prices quite a bit. I’d say most electronics are overpriced about 25%-50%, but there are some items that can be twice as expensive or even worse! So be sure to double check those prices and make sure you really need to purchase it in Ecuador. Combine this with a relatively poor population and you will find that most general electronics stores offer pretty underwhelming machines and parts for overly inflated prices. Definitely try to plan ahead and bring a good laptop or whatever computer you think you will need as you will certainly overpay for an inferior machine if you buy it here.
What is the quality of life in Ecuador?
You can enjoy a rather high quality of life at a reduced cost in Ecuador as described above. Fruits and vegetables and other staples are fresher, healthier, and cheaper for example. There are certainly some areas where you will see & experience a lower quality of life though.
For example, in rural areas you will certainly experience more bugs and mosquitoes (Remember, this is the edge or even in the Amazon rain-forest). Additionally you will see a lot of stray dogs & cats in the streets particularly in the more rural areas, so you may want to keep an eye on the ground, particularly in a more rural town, to make sure you don’t step in anything.
Like most developing countries, you will generally also need to boil or buy most your drinking/cooking water unless you live in Cuenca perhaps which has some of the cleanest water in South America straight from the Andean springs.
One other downside is that the various utilities can randomly go out at times, this used to be much worse in the past but while things have improved this is still an issue from time to time. If you work online, I highly recommend having a backup power, like a UPS, or a large external battery to get you through the occasional outage. I also like to keep some extra data on my SIM card so I can always use it as a hotspot to stay online as a backup. Most locals will also keep some extra fresh water on-hand in case there is some issues.
Another thing to consider, as most other South American countries, Ecuador can be extremely bureaucratic. Expect to wait for things, plan to wait longer than they tell you, often at three times as long.Things move slower here than what you may be used to. Shipping things in Ecuador can also be rather slow. Even when you use a priority shipping service there is likely to be some kind of delay. Things can really grind to a halt if there is a protest or during an election. Things will get done, they just take longer so you may need some patience living here.
There are some gaps in the public healthcare system, so many retirees and others opt to purchase a private insurance plan, but this is still very affordable.
How open is Ecuadorian culture?
Ecuadorians are very open to new ideas, cultures, and people.The country is quite diverse with populations from most all major countries in many of the cities and even a surprising number of even smaller communities. You will have no problem finding a Chinese or Indian market in the major cities for example.
If you are willing to learn some Spanish it will generally be pretty easy to integrate into towns and cities. And even if not, there are fairly large expat communities and most of the cities and all along the coastline. Most locals will still try their best to help you even if you can’t communicate well.
Taxes in Ecuador?
Ecuador is a territorial tax system which means it only taxes income earned within the borders of Ecuador. This means you only need to worry about tax for any Ecuador-source income. Any income inside the country is taxed on a fairly simple and progressive tax rate.
| Income (USD) | Tax on excess (%) |
| $0 | 0 |
| $11,310.01 | 5 |
| $14,416.01 | 10 |
| $18,018.01 | 12 |
| $21,630.01 | 15 |
| $31,630.01 | 20 |
| $41,630.01 | 25 |
| $51,630.01 | 30 |
| $61,630.01 | 35 |
| $100,000.01 | 37 |
The corporate tax rate is between 22 and 28%.
Getting Residency in Ecuador
There are a bunch of ways to claim residency in Ecuador. Everything from proving retirement income, teaching, taking classes, buying a house, or just depositing money into the bank can work to get you residency. Check out my post on getting residency in Ecuador for more details. Ecuador actually has one of the best paying residency by investment programs out there. You can get almost 10% on a bank deposit AND qualify for residency all at the same time. Not a bad deal!
Obtaining Citizenship in Ecuador
Once you have obtained residency, you must spend some time to convert it to a permanent residency, or receive permanent residency by marrying an Ecuadorian or Ecuadorian permanent resident. This will take two years and generally you must reside in the country at least 9 months a year. Once you have permanent residency, you simply need to spend another three years in the country and then you can apply for citizenship.
Ecuadorian citizenship is a very interesting one to consider as a second passport for most westerns. While it doesn’t grant access to North America or most of Europe. It is worth noting that it is the only country in the Americas with visa-free access to both China and Russia, in addition it has access to all of South America, and many other countries as well as visa on arrival even for Iran. Definitely not a top-tier passport, but this can fill a lot of holes in a standard westerner’s travel access.
Conclusion
Ecuador is a very interesting little county that is frequently discounted in favor of its larger neighbors. But there are some serious benefits to living in Ecuador. There is a very low cost of living with a good quality of life, you can buy a variety of nice property for not much money, and even land if you want. You could have a place on the beach, or high in the mountains, or even in the historic district downtown for not a whole lot of cash. The locals are very welcoming and the country is quite reasonably safe.
You don’t have to deal with an obscure currency and can transact, bank, and do everything in US dollar. The territorial tax system can also provide you or your company with some large tax savings if you structure it correctly. It even has one of the best residency for investment programs offering almost 10% in interest while gaining residency! Additionally, the residency program is quite flexible with many options if you can’t afford the investment. There are so many benefits in this little country you are sure to find something that works for you.
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