Pensionado Visa vs Friendly Nations Visa: Which Is Better for North American Retirees?

Overview of Panama Visa Options

Being such a prolific nation when it comes to residency permits, Panama’s residency guides are always useful. Today, we compare two programs: Panama pensionado vs friendly nations. Each caters to different needs and adapts to separate conditions, like obtaining a pension for life or being a citizen of a specific country. 

A comparison of the costs, requirements, real estate entries, and overall characteristics can be quite useful in the early stages of migration.

Comparing the Costs of the FNV and the Pensionado Visa

The visas target specific types of expats; hence, the costs adapt accordingly. Those receiving a pension are usually not in their most productive years; instead, they're in a place in life in which they want to work less or not at all. Panama proposes a great advantage by setting forth a $1000 minimum threshold (lifetime pension), which is relatively easy to reach.

Retirees don't have to raise a family, and they usually have pension funds or savings, all of which can stretch further in a country with a lower cost of living. 

For a US citizen or a Canadian, 1000 dollars may not be a fortune in their home country, but in Panama, they open many doors. This is especially so because the visa holders have access to several benefits. 

On the other hand, the cost of the Friendly Nations Visa varies depending on which entry you choose. It ranges from zero if you have a job contract from a Panamanian company to $200,000 for a real estate investment. 

For further clarification, we recommend you download our brief on the FNV.

Download A Brief on Friendly Nations

Comparing the Requirements of the FNV vs the Pensionado Visa

The first requirement to be assessed when comparing pensionado vs FNV is eligibility. Other documents and proofs will have to be submitted to confirm such requirements, identity, and the relationship with dependents (if any). Further, the applicant’s good character and good health.

With this said, we can use a chart for a quick glance

Panama Friendly Nations vs Pensionado – requirements and main facts

Comparing the Application Process for the FNV and the Pensionado Visa

Both programs are similar when it comes to processing. The longer stage is the waiting time as the application is being reviewed, which is, in general, three months. Before that, there's a period usually taking from two to three weeks to gather all documents and fill out the forms. It's important to note that for both visas, 2 visits to Panama are needed.

Physical presence will be required when you submit your application and obtain your permanent resident card, and later, when you obtain approval. Both moments take place at the national migration office. 

Friendly nations vs Pensionado: step-by-step process

• Step 1: consult with your Mundo expert and assess your case regarding approval (or rejection) possibilities
• Step 2 (only if applies): Proceed with the purchase of real estate (in both programs) or incorporate a company and hire yourself (FN)*
• Step 3: collect all forms and documents, including property title or certificate of incorporation
• Step 4: attend the immigration service in person to submit the documents and obtain a temporary resident card
• Step 5: Attend the immigration service in person to obtain the approval letter and the definitive resident card (two-year resident card for friendly nations, permanent resident card for pensionado)
• Step 6: Apply for and obtain a Panamanian cedula (only if you have permanent residency)

* If applying through a Panamanian job, a copy of the contract must be submitted. 

According to Executive Decree No. 226, article 3, applicants obtain a 2-year permit through FN. After renewal, the applicant can upgrade to a permanent permit and only then to a Panamanian ID (known as Cedula).

Key Benefits of Each Visa

Pensionado vs FNV: Benefits of the retirement visa

For many expats, a $1000-dollar monthly pension is relatively easy to achieve. Yet in Panama, they can do much more with this money than back at home. 

Besides, the country stipulates a wide range of benefits for pensioners, ranging from discounts on healthcare and prescription medicine to discounts on movies and hotel stays. 

From Monday through Thursday, discounts on hotels reach 50%, while from Friday through Sunday, they provide 30% discounts. 50% discounts apply to concert movies and sport event tickets, 30% discounts apply on bus, boat and train fares, 25% discounts apply on airline tickets and utility bills, 20% off apply on professional technical services and medical consultations, 15% off applies at fast food restaurants, hospital pills, and loans made in your name, and 10% off applies on medical prescriptions. 

Finally, the third and best advantage: it grants permanent residency.

Pensionado vs FNV: Benefits of a flexible alternative

To tell the truth, friendly nations used to be the ultimate program until it lost its permanent resident status in 2021. Now, offering a 2-year permit visa, which can be renewed, it stands out for its flexibility and relatively easy entry.

Establishing your own company and hiring yourself requires approximately $23,000, which is not bad for residency. The reader should consider extra expenses like paying his/her own salary, paying for Social Security and payments required by law, and facing renewal and administrative costs through the following years. 

Even so, it is much cheaper than the FN real estate investment ($200,000), also cheaper than the Qualified Investor, which starts at $300,000, and far more cost-effective than the European golden visas. 

Pros and Cons of the Friendly Nations Visa

The main downside is that legibility is tied to your citizenship, a fact that cannot be changed. If you look beyond and to other visas, a pension can be obtained at some point in life, and $300,000 can be raised. Yet citizenship can’t be obtained that easily. If you're thinking about CBI countries, these are usually not on the friendly nations list. 

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Pros and Cons of the Pensionado Visa

The only downside we can find in the pensionado program is that dependent children will lose their residence status at the age of 25. Because of this, experts recommend that children of pensioners apply as children of permanent residents and not through the retirement option.

Mundo's recommendation: Pensionado, if you can choose it, choose it 

With such low minimum requirements, no age restrictions, and permanent residency, Mundo recommends pensionado over FN without a doubt. The only factor that may leave you out is a lifetime pension, but if you have it, there's no better option. 

Mundo’s expert opinion: "If you're looking for permanent residency in Panama, then, yeah, without a doubt, Pensionado visa is the best. If you have a pension, don't hesitate because this is the simplest and most straightforward path you can ever get. 

Many of our clients worry about their children losing residency when they turn 25, but if they apply to another program early, they can avoid this. Of course, at 25, they can always choose a different residency path. 

So, as I like to say to clients: if you can do it, why not do it? Why wait? You won't have age restrictions and can work legally. So yes, a retirement visa is definitely my best recommendation when people ask me about Panama".

Exceptions to the Rule: When the FNV May be the More Attractive Option

Despite the above recommendation, many may prefer FN. Those who are not interested in a long-term presence in Panama might be content with a two-year permit. Better yet, if they are business people, establishing a company may be convenient for other goals as well, thus killing two birds with one stone. 

Panama as a Retirement Destination

Cost of Living in Panama

Those from expensive nations find in Panama a hub where costs are much lower. They can afford to rent (or even buy) a nice apartment in the city center, go on vacation, and go out to dinner. Another significant difference lies in the health sector, which, even paying for consultations in private clinics, ends up being cheaper than in the US.

With a 3000-dollar monthly income, you can live quite comfortably in a modern apartment, go out to dinner, make trips, and save some money. Naturally, the costs increase for families, in which case you can expect average expenses between 3,000 and 5,000 dollars a month.

Best Places to Retire in Panama

Panama City

Panama City is the picture we find when we Google “Panama”. A metropolis with high skyscrapers, modern malls, active nightlife, and enhanced infrastructure, it is chosen by retirees who love a capital city vibe and a cosmopolitan environment. 

Coronado

The Central American capital is certainly lovely, yet it doesn't have a beach. This is why many choose places like Coronado. This is a beachfront town with everything they need for modern living while enjoying a small-town pace for those who appreciate a tranquil way of life. 

Boquete 

Finding a place like Boquete in a tropical country is like finding an Oasis in the desert. With heights reaching 3,200 feet, it has cooler weather, hilly landscapes, hiking options, and excellent coffee. 

Eligibility and Application Process for Each Visa

Required Documentation

FNV

• Power of attorney
• 3 pictures
• A copy of the passport (all pages) notarized or authenticated
• Clean criminal record
• Health certificate
• Cheque for $250 to the national treasury
• Cheque for $800 to the National Migration Service
• Sworn affidavit 
• Documents proving the registry of a company or the purchase of a property

Pensionado visa

Above documents, besides:

• Certificate stating your status as a pensioner
• Proof of economic solvency: $250 for each dependent
• Certificate of a real estate duly registered in the public registry (if applies)
• Letter of the company that administers the pension (if the pension derives from private sources)
• Certificate stating the existence of the company (if the pension derives from private sources)
• A copy of the proof of payment or a bank statement (if the pension derives from private sources)
  
  

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Frequently Asked Questions

What is the minimum investment required for Panama residency?

The minimum investment is $300 through the Qualified Investor, while other programs contemplate investment, although they're not mandatory. 

How long does it take to obtain residency in Panama?

From 3 to 6 months. However, the Mundo team can't assure that these timeframes will be respected, as it depends on many factors out of our reach. 

Can my family be included in the application?

Yes. Applicants can add the spouse and children, although children over 18 must be full-time students at the university. Sons and daughters of pensionado visa holders lose their resident status at 25.

Do I need to live in Panama full-time?

Not necessarily, as the country has flexible minimum stay requirements.

Is knowledge of Spanish required?

No.

Conclusion: Which Visa is Right for You?

With what's explained in the article, it's easy to conclude that pensionado is the best option if you have a pension. On the other hand, the FN can be a straight path to Panama if you come from one of the previously selected countries, offering you temporary residency. 

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Legal Disclaimer

The information provided in this article about the visas and their requirements may be inaccurate or outdated at the time of reading. This article doesn't constitute legal or migration advice. We strongly recommend you consult with certified professionals when making decisions about these matters.