Ecuador’s Cost of Living
Ecuador’s cost of living is a subject I have done a lot of research on the this blog. It is probably the subject I get most questions about.
I like writing this blog. I do research, figure things out for myself, then share it with anyone who wants to read about it. I learn a lot, share what I know, and sometimes people question the information I give… When that happens, I go and research a little more to make sure the information I am putting out there is correct.
My new friend Claudia had a few questions about the information I gave in my last post. And although I hate to think I may have misinformed, I might not have given as much information as I should have on the subject of money, inflation, and Ecuador’s cost of living.
So, lets see if I can do it a little better this second time around…
Ecuador’s Cost of Living, Set up Costs, Moving Containers, Inflation
There are a lot of stories about Ecuador’s cost of living, and how low it is. It is easy to get confused when you read that $600 will cover all your monthly expenses and with $1500 you can live like a king. Is this really possible?
There are also the reports that it will cost a fortune to set up your household when you get to this new country. Expensive appliances and electronics, lots of money for kitchen gadgets and furniture. Computers will put you in the poor farm…. Well is this true?
And then there are the stories about how costs are on the rise and they are going up fast. Is that true? And who is causing this inflation? Is it because of the increase in expat population, or is it something else?
Lets cover Ecuador’s cost of living first.
From everything I have seen, $600 a month budget leaves no room for any contingencies or unexpected emergencies…. Plain and simple, if you can find an apartment for $250 per month and you don’t eat out, and you don’t get sick, and don’t need a dentist, and don’t need new things like clothes and shoes, then you might be able to get by on $600. I think minimum is more like $850 a month. No travel, no new stuff, just basic survival, a cheap cell phone, no internet or cable TV. I could do this but I don’t know if I would want to.
On the other side of the coin is the good life. Plan on $1800 per month living in a $600 apartment or house, you have health insurance, maybe a dog, maybe even a car. You send your laundry out and have a house keeper/helper two days a week. You also have internet, cable TV and a couple of cell phones. You can eat out 3 or 4 times a week and have an extra $200 per month to do with as you please. Ecuador’s cost of living can get as high as living in the states if you want and need all those things and trappings….
Somewhere in between these two examples will get you a cost of living at about $1200 per month. Rent at about $450, no car, you probably do your own laundry and domestic help maybe once a week. Not much left at the end of the month. I have all this broken down in an earlier post call “Cost of Living in Ecuador”. Wish I knew how to create a button here to get you easily to the other post. Anyone know how to do that?
My niece Niki and new friend Burt just sent me the information for creating a link… cool. Lets see if it works. To see my previous post with three different detailed budgets click on the word “Budgets“.
Our goal is to live on $1500 a month without a car. We are hoping we can bank $200 per month from this budget to a travel fund.
Cost to set up your new household
This is the subject that my friend Claudia had questions about. Here again, you will get mixed reports. Some say you can do this on the cheap, and other say that this will be very expensive.
In a nut shell, both reports are correct.
Imported items are expensive, locally produced items are not. So, a Maytag washer/dryer could be double the cost of a similar appliance that is manufactured in Ecuador. Watch for sales and always negotiate. Furniture and mattresses are available locally so if you shop around your furnishings should be pretty reasonable.
But there are things you will need that are not cheap. Electronics, TV’s, imported Smart Phones, and Computers are some of those things. So, how do you get these on a budget?
Buy technology that is a year or two old. Last years Plasma Television will be your cheapest bet on a flat screen compared to the same size LED. New technology is expensive. Sometimes twice as much. Same thing goes for computers. This years iMac desk top will cost a fortune but you can find last years PC for prices that are not to much more than what you would find in the states.
We are bringing an iPad, a laptop, and a MiniMac with us as they are small enough to easily fit in a suitcase. We will buy keyboard, monitor, and printer when we get here.
So, buy locally manufactured things and get some great prices. Quality is sometimes suspect but let your sensibilities be the judge. Do your research on the different brands and ask around. Give yourself some time to set up your house. You don’t need to do it all in the first week. If you take your time you might run across gently used things. Ecuador’s cost of living can stay low if you shop smart.
Our plan is to buy a very expensive imported coffee machine and everything else will be local stuff. We also realize that we will be furnishing a two bedroom place, not a 5 bedroom house. We only need one of everything instead of 3 or 4 of everything makes a huge difference in set up cost…
Ballpark prices for these things…
- 40 inch Plasma Flat Screen $1000
- Couch and coffee table $550
- Queen Bedroom Set $500
- Queen Mattress $350
- 18 CF Refrigerator $500
- XYZ Kitchen Range $500
- Microwave Oven $200
- XYZ Brand Washer/Dryer $900 for the pair
(Newer technology or imported brands will double the above prices)
One last thing on this subject. Keep you eye open for a rental property that is partially furnished. This could save you on your set up costs. Also remember that you can rent fully furnished places but those will have monthly rental pricing that can be $250 more than unfurnished units. Renting furnished gives you the freedom to move around fast and easy. Just pack up your clothes and go. Some people rent furnished for the first year just to see how this new lifestyle suits them. Something to think about…
Moving Container… Is it worth it?
In this section I will talk only about what we have decided. We currently live in a big house in the states. Lots of everything. 6 Flat Screens, 5 sofas, 3 stereo systems, 3 desktop computers, and I could go on. My house has 6 refrigerators! Don’t ask…
This is not how I want to live anymore. We only need one of everything. One TV, one refrigerator, one sofa, so I am dead set on selling everything. Our goal is to scale down to almost nothing so we have more freedom to travel around if we want.
We will not be paying the five or six thousand dollars for a shipping container to move all our stuff to Ecuador. Not that this is wrong, but we can buy all the stuff we need once we get to Ecuador for about $4000. This is the right decision for us.
But if you must have your pool table, your Craftsman tool box and all your tools, and your antique furniture, then you should get that container, and move your stuff. Just be absolutely sure that Ecuador is what you really want. Six months down the road if you should decide that the move was wrong, that move back will be that much harder with all your stuff in tow.
Are things getting more expensive in Ecuador?
This was the other question my friend Claudia wanted me to clear up. If prices are going up, what is causing this?
In Cuenca, there is a population of about 500,000 people. There are about 5000 expats in Cuenca. Could it be possible that 1 percent of the population is responsible for all this talked about inflation?
I think this is another yes and no answer…
Let me try to explain. I am currently trying to sell a couple of expensive homes in my little mountain town. Someone suggested I advertise these homes in the Palm Springs and Los Angeles newspapers because those people have money and they would grab up my homes for sure… Not sure if I agree with this marketing strategy, but lets use this way of thinking but insert Ecuador into the story.
An apartment in Cuenca might have two prices, a local price and a gringo price, and the difference could be $200 per month. I was in the Mercado buying fresh vegetables and a local ahead of me bought 3 avocados for half what I was asked to pay for them. Even the shoe shine boy in Quito charged a local man a quarter for a shoe shine but wanted $2 from me. I think this is where the inflation is coming from.
This inflation is real, but in most cases it is only the gringo that is feeling it. And who’s fault is this. Guess?
When we (the gringo) agree to pay more than market value, we are ruining it for everyone that comes after us. We are painting a huge bullseye on our foreheads and creating a two tiered pricing structure.
I am not an economist, but my guess is that this might, over time, start to raise prices across the board for everyone. And this would then create an even bigger problem.
The best thing that everyone can do is find out what the going price is for the things you buy all the time and only pay that much. Leave a quarter for a tip instead of a dollar, find out what a taxi costs to your destination and insist on paying only that much before you get into the cab. That shoe shine boy story is the best example of this gringo inflation.
Stop paying two dollars for 50 cents worth of rice. It screwing up the economy…
Hope this post was helpful. I know that cost of living and cost of setting up is important to everyone. I know it is to me.
Have a great weekend everyone….
If you have any experience with this subject please leave a comment… thanks.
Sites That Link to this Post
- Morning Update – Monday, October 22, 2012 « South of Zero | October 22, 2012
- Top 6 Posts on Ecuador George in 2012 - Ecuador George | January 5, 2013
- Ecuador Retirement and Money - Ecuador George | April 2, 2013