Costa Rica monthly family budget (from Al Dia)
Insidecostarica.com translated an article from the Costa Rican daily newspaper Al Dia. It’s still quite reasonable, but doesn’t take into account the kind of expenses an expat with different habits might incur. Overall, it’s quite promising but we still have to consider health insurance and broadband internet – both of which can add up to $250 each to the budget. I’ve added dollar conversions to all the figures.
More than ¢450.000 ($908) Needed For Family of Four To Meet Basic Needs
A recent survey by the Spanish language daily, Al Día, reveals that a family of four needs an income of ¢447.788 (us$904) monthly to meet living expenses, including the cost of food, water, electricity, telephone (home phone and cellular), bus fares, a couple of nights out to a restaurant and payment of a mortgage of ¢20 million colones (us$40.500).
That figure is much higher that the ¢107.220 ($216) colones the Instituto Nacional de Estadística y Censo (INEC) says is needed to make up the basic food basket and more than twice the average income of ¢259.722 colones ($524).
According to the INEC, general incomes range from ¢223.350 ($451) monthly paid by private business to ¢371.027 ($749) paid by the central government and ¢461.500 ($931) paid by the government institutions and agencies.
The Al Día calculates that if the family lives outside of San José, like Alajuela for instance, and require use a vehicle, the monthly cost increases to ¢575.848 ($1162), not taking into account the recent round of increases in fuel that go into effect later this week, as well as the recent increases in food items such as milk, rice and beans.
For the director of the Oficina de Apoyo al Consumidor (Consumer Support), Cynthia Zapata, says that people should avoid getting into debt as much as possible.
“One has to be strict and do all possible to keep control of the budget. The current condition shows that people are not saving”, said Zapata.
Financial expert, Miguel Díaz, advises that families should budget their expenses. “It is very difficult to send a child to school, where they see a schoolmate with an iPod, and of course want one also, but one has to say no to avoid financial imbalances”, said Díaz.
The following is a sample monthly budget for a family of four as prepared by the Al Día:
Basic Food Basket ¢107.220 / $216
Electricity ¢11.928 / $25
Water ¢5.576 / $11
Cellular Telephone ¢11.000 / $22
Home Telephone ¢7.500 / $15
Mortgage ¢240.000 / $484
Bus Fares (for 2) ¢17.500 / $35
Two Visits to a Restaurant ¢20.000 / $40
Domestic Help – 4 days ¢12.864 / $26
If living outside San José (Alajueal for example) add ¢14.200 / $28
If a vehicle is owned add:Gasoline ¢43.348 / $87
Car Payment * ¢84.712 / $171
City Bus Fare ( 1 person) ¢8.500 / $17
If children in daycare add:Monthly cost ¢75.000 / $151
Domestic help ¢96.531 / $195
Extra Cellular Phone Cost ¢11.000 / $22
If family enjoys cable television add:Monthly cost ¢12.500 / $25
* ¢10 millones loan from Banco Nacional
Source: Al Día
I think this is a sad commentary on where Costa Rica is headed – higher prices, but stagnant salaries. However, there are several things that I don’t quite “buy” about the article:
Average salaries take into account the “average” tico… those that get paid rock-bottom salaries. Some of my friends, who have college educations and even post-graduate degrees, make between ¢250.000-¢350.000/month. According to the study, they’re about “average” in income, though we know that many ticos don’t have the advantage of a post-graduate education.
“Average” ticos will not have a housecleaner 4 times/month. “Average” ticos will spend nowhere near ¢11.000 on a cell phone (more like ¢6.000). “Average” ticos will certainly not have a mortgage of ¢240.000/month! Most will either rent inexpensive homes (¢150.000 or less), live at home, or live in the houses that have been left to them by their parents (no rent at all). And an “average” tico will absolutely not have a car.
I understand what the study is saying, but I think it’s a misrepresentation of the facts. With the above budgets in mind (including the ¢150.000 rent), we’re talking a monthly budget more along the lines of ¢212.000. That’s definitely scrimping a bit, but much more realistic for a family that doesn’t have a whole lot of income. And it’s hard, yes. But not as impossible as Al Día made it sound.
Erin’s last blog post..Phase Three: Always a Work in Progress
It’s like the US then, no? Stagnant salaries and increasing cost of living for years. But you’re right – why would an average family blow money on domestic help or a car? And if someone has a car, it’s probably something old & easily repaired rather than something requiring a payment. Thanks for providing a more realistic perspective. I remember when I first joined CostaRicaLiving a few years ago and one of the responses I got regarding budget was some guy in Escazu with an expensive condo and 2 new cars who thought I could ‘probably’ get by on $4-5k a month. I don’t get by on that now and I don’t ever want to have expenses like that.
As for where CR is headed is anybody’s guess. The worldwide housing speculation is over and it looks like the shit is going to hit the fan over the next couple of years. Oil prices will stay high and the cost of imports will rise. All I can think is that people will need to be fiscally prudent and adaptable.
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