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RESIDENCY PERMITS

How Americans can retire in Spain

Spain is an attractive country for US nationals looking to retire in Europe. But before you consider making the move, here are a few things you should consider, including visa options, healthcare and living costs.

Published: 7 October 2021 15:07 CEST
How Americans can retire in Spain
Retired citizens who want to move to Spain can apply for a non-lucrative visa, which can be renewed after a year. Photo by Josep LAGO / AFP

According to Spain’s national statistics agency, the INE (Instituto Nacional de Estadística), there are some 40,712 Americans officially residing in Spain: 21,933 American women and 18,779 American men, spread out across Spain’s 19 autonomous regions.

Madrid is the most popular region, home to a quarter of US citizens (11,634), followed by Catalonia (9,431) and Andalusia (6,652).

READ ALSO: Where in Spain do all the Americans live?

Americans of all ages are seduced by the Spanish culture, the food, the history, the weather and its overall great quality of life, all of which can be fully enjoyed during retirement. 

But before US retirees start dreaming about a move to Spain, they should first consider the practicalities, starting with visa and residency options. 

Given that the main purpose of this article is to help American pensioners to enjoy their retirement in Spain, the two most suitable visas are the non-lucrative visa and the golden visa, as they’re not focused on work or study. 

Non-lucrative visa

Often referred to as a retirement visa, Spain’s non-lucrative residency permit (visado de residencia no lucrativa) allows non-EU citizens to stay in Spain for a period of more than 90 days without working or carrying out professional activities. To get it they must demonstrate that they have sufficient financial means for themselves and, if applicable, their family.

It’s the best option for retirees from the US who want to move to Spain. It’s a temporary residence visa that lasts for one year.

The first and second residence renewals last for two years each. After five years of residency, they can apply for a long-term residency, which lasts for another five years.

After ten years of residence in Spain, US citizens can obtain Spanish citizenship, although they will technically have to renounce their American nationality in the process.

READ ALSO: What you need to know about applying for Spain’s non-lucrative visa

To get the visa, US citizens will have to demonstrate that they have “sufficient financial means”, but the exact amount of money you have to have can vary between Spain’s regions and provinces.

The Spanish government is referring to the IPREM, an indicator that in 2023 will rise to €600 ($631 with the current exchange rate) per month, just under €20.98 more than in 2022 and €40.98 more than in 2020.

The standard financial requirement for non-lucrative visa applicants is 400 percent of the IPREM: in 2023 this will be €2,400 ($2,528) per month.

So for a US national wanting to apply for the non-lucrative residency permit for Spain for the first time (it lasts one year), the amount they need to prove is €28,800 ($30,335). 

However, these figures should be used only as a reference.

It’s important to note that applications for a non-lucrative visa have to be made from the US. 

READ ALSO: How much money do Americans need to become residents in Spain in 2021?

Golden visa

Spain’s golden visa, sometimes referred to as an investor visa, allows non-EU citizens the right to live in Spain if they meet several requirements.

These include buying a property worth over €500,000, investing €1 million in a Spanish company or having €1 million in a Spanish bank account.

Your spouse/partner, any children under 18 and dependent parents can be included in the visa, and it also enables you to have freedom of movement throughout the Schengen area’s 26 countries. However, it’s only valid for one year, after which you can exchange it for a residence permit, valid for another two years and then get permanent residency after five years.

When applying, you will also have to prove you have sufficient financial means or income to cover your and your family’s costs.

The golden visa requires a sizeable investment, even for those earning six figures every year, and you may have to pay a non-resident tax and wealth tax. So before you decide whether this is the best visa or residency option for you, here is an important list of advantages and disadvantages that come with Spain’s visado dorado (golden visa).

Applications for a golden visa can be made from either Spain or the US.

PROS AND CONS: What foreigners should be aware of before applying for Spain’s golden visa

Health care options

Most foreigners in Spain without residency or work permits cannot automatically receive public free healthcare in Spain. 

In fact, both the non-lucrative visa and the golden visa require you to have comprehensive private health insurance taken out to be able to get residency, covering as much as the Spanish public healthcare covers.

While private healthcare is generally affordable in Spain, costing between €50 and €200 a month, it can add up to a much heftier bill for those with pre-existing conditions.

You’ll find a list of the best private healthcare options in Spain here.

READ ALSO: What are the best private health insurance options in Spain for foreigners?

It’s worth noting that there is a scheme called convenio especial, which is the pay-in public insurance (SNS) for those who are not eligible to be covered. The plan provides access to the public healthcare system for a monthly payment and covers all pre-existing medical conditions, but not prescriptions. It costs €60 per month for anyone up to the age of 65 and €157 euros for those 65 and above.

However, you can only apply for a convenio especial if you have been registered at their local town hall in Spain for at least a year.

Cost of living

A lower cost of living is among the many reasons US citizens may choose to retire in Spain. 

According to the Number Cost of Living Index, Spain was given a score of 53.77, which means it is 46.23% cheaper than New York (excluding rent).

Spain is the cheapest Eurozone country for clothing, according to a report from Eurostat. The price of alcohol and tobacco is also much cheaper here than in other EU countries, while the cost of groceries and transport are also much lower compared than the EU average.

However, some bills like internet, electricity and banking services can be more expensive in Spain than in other countries. Prices for internet typically vart between €30 and €50 per month.

READ ALSO: The hidden costs of moving to Spain

Tax

Another thing to consider before you move to Spain is declaring any assets you hold abroad. 

If you have money in a foreign bank account, private pensions, property, shares or any other assets back home that are over €50,000 in value you have to declare it to Spanish tax authorities.

It applies equally to Spanish citizens and foreigners legally resident in Spain and is for information purposes only. In other words, you won’t be expected to pay tax on assets held abroad but can be fined if you don’t declare it.

But it’s also worth noting that tax residents in Spain will be taxed on their worldwide income from employment, pension schemes, renting out a property, etc.

There are also taxes such as inheritance tax to keep in mind, which are generally higher in Spain than in other countries and also vary greatly between regions, and the wealth tax (impuesto sobre el patrimonio) for those lucky enough to have considerable assets (upwards of €700,000). 

READ ALSO: The most common tax problems foreigners in Spain run into

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VISAS

EXPLAINED: When you can exchange visas in Spain

There are several different types of visas and residency permits you can get to be able to live and work in Spain, but what happens when your situation changes and you want to exchange your visa for a different one?

Published: 30 April 2024 14:20 CEST
EXPLAINED: When you can exchange visas in Spain

There are many different reasons you may want to exchange the type of visa or residency permit you have. Perhaps you’re on a student visa and have completed your studies, but still want to be able to stay in Spain. Or maybe you’ve been on a one-year non-lucrative visa, but can no longer afford not to work and want to exchange it for one where you’re allowed to work. 

Read on to find out which visas are possible to exchange and which are not. 

Student Visa to Digital Nomad Visa 

The simple answer is yes, it is possible to exchange your student visa for the new Digital Nomad Visa (DNV) that first became available last year. This will, however, depend on your individual circumstances and what job you plan on doing.

Firstly, in order to apply for DNV you must either have a degree from the field you want to work remotely in or have three years’ work experience in that industry. If you’ve just finished your studies this could be possible, but if you were studying something different, it could prove difficult.

If you are an older student, you could definitely have three years’ work experience in the industry you want to work in or you may have gained the experience working part-time in Spain while on your student visa.

Secondly, you must make sure you have worked for the company that hired you for a remote role for a minimum of three months before you apply for the DNV. The main caveat is that the company has to be registered outside of Spain as you are not eligible for the DNV if more than 20 percent of your income comes from inside Spain. This means that you will have to secure a remote job in another country while still on your student visa, making sure that you stick to the 30 hours a week you’re allowed to work.

Non-Lucrative Visa to Work Permit or Self-Employed

Being in Spain on the Non-Lucrative Visa or NLV can prove to be expensive because you’re not allowed to work, but have to prove you have a significant amount of savings or passive income. If you want to stay in Spain, beyond the initial year, you may be considering a different residency permit. Luckily, you can exchange it for a work permit or self-employed permit in a process called residence modification.

During your last few months on the non-lucrative visa, you are able to apply for jobs in Spain, which may give you the possibility of being granted a work permit. There are many prerequisites, including having lived in Spain for a year and being offered a pre-employment contract.

You could also decide to become self-employed at set up your own business. In order to do this you will need to meet the requirements that current legislation requires for opening and operating your chosen business. You will also need to sign up to the autónomo system, pay your own social security fees and submit your taxes five times a year.

READ ALSO: Should I change my non-lucrative visa for another residency permit in Spain?

Student Visa to Work Permit or Self-Employed

If you’re living in Spain on a student visa, then it’s relatively straightforward to exchange it for a work permit or become self-employed, if you want to be able to stay longer. The main requirement is that you have to have lived in Spain for three consecutive years, before you exchange it. This means, it’s really only possible for those who are doing a long-term course, such as a degree at a Spanish university. If you’re simply here for a year doing a language course, then it won’t be possible.

If you have been here for three years on a student visa, you have two options – the first is to find a job and become an employee by getting a work permit and the second is to become self-employed. If you opt for the first, the easiest way is to get a job offer and apply for the permit that way. Because you’ve already had a student visa and been here three years, it will be easier for companies to hire you as they won’t have to prove that there isn’t anyone from Spain or the EU that can do it first or that they have a shortage of professionals who can carry it out.

If you want to exchange it for a self-employment permit, you will have to present a business plan in order to get approval and prove you have the correct qualifications and experience to carry it out. If approved, then you will typically sign up to the autónomo system.

Student Visa to Entrepreneur Visa

Student visas are the easiest visas to modify in Spain, meaning you have many different options to exchange them if you want to stay longer. The Entrepreneur Visa – Visado de Emprendedor is another option that will allow you to stay for a period of three years (with the option of exchanging or extending). It is, however, slightly more complicated to exchange to than simply getting a work permit or becoming self-employed.

The Entrepreneur Visa is especially for those who want to set up a business considered to be innovative with a special economic interest for Spain. Unlike becoming just an autónomo, you must agree to be able to create employment opportunities for locals in the future. You could also in theory exchange your NLV for an entrepreneur visa too, provided you can prove that you haven’t done any work while you’ve been living in Spain for the year on your NLV.

Non-Lucrative Visa to Digital Nomad Visa

Unfortunately, this exchange is not possible. The main issue is that you’re not allowed to work while on a NLV and the requisites of the DNV are that you must have worked for the company that hired you for a remote role (or your clients if you’re self-employed) for a minimum of three months before you apply.

If this is the case then you’ll be admitting that you were working while on your NLV, which could get you into trouble. This means will have violated the terms of your visa and will be highly unlikely to be granted another one. You may also face penalties and fines, depending on your circumstances.

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