Choosing where to retire involves much more than finding good weather or affordable living costs. Access to healthcare, safety, housing options and overall quality of life are all key considerations. With this in mind, the Live and Invest Overseas Retirement Index 2026 compared 12 international destinations to identify the best places in the world to retire, with a Spanish city and another location close to Spain both featuring among the top-ranked destinations.
How the report was compiled
The annual Live and Invest Overseas report evaluates international retirement destinations using 14 criteria related to everyday life. The ranking is primarily aimed at American retirees considering a move abroad.
The report assesses factors such as cost of living, healthcare access, safety, climate, taxation, residency options, infrastructure and the presence of expatriate communities. Before selecting one of the best retirement destinations, it is worth considering practical factors such as:
- A realistic monthly budget, including rent or mortgage payments, utilities, food, leisure activities and transport.
- Access to healthcare, both public and private, as well as available medical insurance cover.
- Residency requirements, including visas, minimum income thresholds and renewal procedures.
- Taxation, particularly regarding pensions, investments, property ownership and overseas income.
- Housing affordability and availability, which can vary significantly between tourist destinations, cities and rural areas.
- Climate and environmental risks, such as heatwaves, flooding, wildfires or seismic activity.
- Language and social networks, two factors that can play an important role in successful integration.
- Connections with Spain and family, including road links and direct flights.
The Spanish destination that made the list
Spain appears in the Live and Invest Overseas ranking thanks to Tarragona, which occupies sixth place globally. The city has established itself as an attractive option for retirees seeking a Mediterranean lifestyle, quality public and private services, cultural heritage and a lower cost of living than Spain's largest cities.
The report estimates a monthly budget of $2,008 for two people. Among Tarragona's strengths are its infrastructure, safety, leisure opportunities and healthcare network. It is home to public hospitals including the Joan XXIII University Hospital and Hospital de Sant Pau i Santa Tecla.
The city also offers beaches, historical attractions and strong rail connections without the housing costs associated with major metropolitan areas. According to the index, a furnished two-bedroom rental flat can cost less than $900 per month.
The ideal retirement destination near Spain
The Algarve, in southern Portugal, ranks second in the global index and leads all European destinations included in the study. Stretching from the Spanish border to Sagres on the Atlantic coast, the region combines seaside towns, established infrastructure and a wide range of outdoor activities.
The report awards the Algarve top marks for healthcare, safety, infrastructure, leisure opportunities and its international community. It also highlights the widespread use of English. What's more, the area enjoys 3,000 hours of sunshine annually.
A reference monthly budget for two people
The study estimates monthly living costs in the Algarve at around $3,085 for a couple. Within that figure, rent for a two-bedroom flat accounts for approximately $1,700 per month.
These figures are indicative estimates based on a particular lifestyle and may not reflect the spending patterns of all households.
Housing, the key determining factor
Housing is one of the categories where costs vary most significantly across the region. According to the report, the province of Faro records the highest prices, with Loulé and Almancil among the Algarve's most expensive locations.
Other towns in the region, however, continue to offer more affordable housing alternatives.
What is the best place in the world to retire?
Boquete, Panama, tops the ranking of the best places to retire in 2026. Located in the province of Chiriquí, this mountain town receives an overall A+ rating and stands out for its mild climate, safety and well-established international community.
The index estimates a monthly budget of approximately $2,400 for two people. The town is home to a large population of retirees and residents from the United States, Canada and Europe.
Panama also stands out for its administrative advantages, particularly its Pensionado Visa, which is designed for retirees. As a general reference, applicants must demonstrate a pension income of at least $1,000 per month, while the programme also offers several benefits for retirees.
The best places to retire in 2026
The 2026 index includes destinations across the Americas, Europe, the Caribbean and Asia. These are the top 10 locations in the ranking:
- Boquete, Panama: Ranked first for its climate, safety, international community and retiree-friendly policies.
- Algarve, Portugal: The highest-ranked European destination, offering sunshine, services, healthcare and proximity to Spain.
- Puerto Vallarta, Mexico: Combines healthcare facilities, international connections and a large expat population.
- Gascony, France: A quiet and rural option between Bordeaux and the Pyrenees, with strong healthcare services and relatively moderate costs.
- Crete, Greece: Offers a Mediterranean lifestyle, natural beauty and lower costs than many other European destinations.
- Tarragona, Spain: Noted for its beaches, heritage, services and lower living costs compared with Spain's largest cities.
- Santa Familia, Belize: A destination that appeals to retirees seeking nature, English as an official language and retirement-friendly programmes.
- Hua Hin, Thailand: Recognised for its low cost of living, private healthcare and active international community.
- Kotor, Montenegro: Attractive for its Adriatic scenery, safety and moderate living costs.
- Las Terrenas, Dominican Republic: Combines Caribbean beaches, a strong international presence and favourable conditions for foreign residents.
