I used to think retiring in Portugal meant living in a crowded tourist city.
But then I started exploring beyond Lisbon and Porto, and everything changed.
Portugal is consistently ranked one of the safest countries in the world. Its cost of living is a fraction of what we’re used to in the States.
But more than that, it has a genuine warmth that you feel from the people and the culture. The weather is gentle too, and life feels unhurried.
If you’ve ever dreamed of a slower, sunnier retirement, Portugal is waiting.
Here are 10 peaceful places so perfect you’ll wonder why you didn’t move sooner.
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Discovering Peaceful Places to Retire for Americans in Portugal
Portugal offers a stunning variety of landscapes and lifestyles. You can find bustling city life, quiet coastal towns, or rural tranquility.
To help you find your perfect fit, I’ve explored the country from its southern shores to its historic heart. Here are ten incredible spots that offer peace, beauty, and an amazing quality of life.
The Sun-Kissed Algarve
The Algarve is Portugal’s famous southern coast. It’s known for golden beaches, dramatic cliffs, and over 300 days of sunshine a year. It’s a haven for expats, making it one of the easiest places to settle in.
1. Tavira: The Venice of the Algarve
Tavira is one of the Algarve’s most beautiful towns. A Roman bridge arches over the Gilão River, which flows through its center. The town is filled with historic churches and charming, tiled buildings. It has a more traditional feel than other resort towns.
You’ll love the short ferry ride to the pristine Ilha de Tavira, an 11-kilometer-long island beach. The town’s main market, the Mercado Municipal, is a daily hub for fresh fish, produce, and local life.
Tavira has a growing expat community, but it’s not overwhelming. This makes it easier to connect with both locals and fellow Americans. A couple can live comfortably here for around €2,000 per month, including rent.
2. Alvor: A Tranquil Fishing Village
Nestled between the larger towns of Portimão and Lagos, Alvor retains its charm as a traditional fishing village.
Its relatively flat terrain makes it wonderfully walkable, perfect for leisurely strolls along its famous boardwalk that crosses the Ria de Alvor Nature Reserve.
The atmosphere is close-knit and tranquil. The community here is diverse and welcoming, with many British, Dutch, and German retirees creating a vibrant social scene.
While local healthcare facilities are great for daily needs, the well-equipped Hospital Particular do Algarve is right in town for more comprehensive care. A couple’s monthly budget here typically falls between $2,735 and $3,735.
3. Praia da Luz: A Multinational Coastal Gem
Praia da Luz, or “Beach of Light,” is a former fishing village that has become a desirable coastal town. It has avoided high-rise development, maintaining a relaxed, low-key character.
The beautiful bay is sheltered by the dramatic black basalt cliffs of Rocha Negra.
This spot was once a firm favorite of British expats. Now, it boasts a truly multinational community with a growing American presence. This large expat population means that many cafes and restaurants stay open year-round, creating a lively atmosphere even in the winter.
Its proximity to the historic city of Lagos provides the perfect balance of peace and activity.
The Island Paradise of Madeira
Known as the “Island of Eternal Spring,” Madeira is a subtropical paradise in the Atlantic. It offers lush landscapes, a relaxed pace of life, and a wonderfully mild climate all year.
4. Funchal: Sophisticated Island Capital
Funchal, the island’s capital, perfectly blends city amenities with a laid-back island vibe. Imagine starting your day walking along palm-lined promenades or sipping coffee at a marina-view café. The city is one of Europe’s safest and most beautiful spots.
The cost of living in Funchal is a major draw, as it’s substantially lower than in Lisbon. A single person can live comfortably on about €643 a month before rent.
The expat community is large and active, and the healthcare is excellent, with a high doctor-to-patient ratio and modern facilities like the Hospital da Luz Funchal.
5. Ponta do Sol: The Sunniest Spot
True to its name, which means “Sun Point,” Ponta do Sol is the warmest and sunniest spot on Madeira.
This small coastal village has a slower pace of life, centered around its pebble beaches and incredible ocean views. It’s perfect for those who love the outdoors, with stunning hiking trails along the famous levadas (historic irrigation channels).
A unique feature is the “Digital Nomad Village,” which has brought a vibrant, international energy to the town. This benefits retirees with more social events and better infrastructure.
Better yet, housing costs are significantly lower than in Funchal, making it a fantastic value.
The Authentic Silver Coast
Stretching between Lisbon and Porto, the Silver Coast offers wild, beautiful beaches and a more authentic Portuguese experience.
It’s a fantastic choice for those who want to retire in Portugal away from the main tourist hubs.
6. Nazaré: Where Tradition Meets the Waves
Nazaré is a town of two worlds. It’s a traditional fishing village where women still wear the iconic seven skirts. It’s also a global hotspot for big-wave surfing, drawing an international crowd.
You can enjoy the calm, family-friendly main beach or watch the pros tackle monster waves at Praia do Norte.
The cost of living in Portugal is very affordable here; you can find a one-bedroom apartment for €400 to €600 a month. (Source: Portugalist) The expat community is close-knit, drawn to the town’s authentic charm.
7. Ericeira: The Surfer’s Haven Near the Capital
Ericeira is a charming fishing village known for its world-class surfing and relaxed vibe. With its cobblestone streets and stunning Atlantic views, it’s an idyllic setting for retirement. Its biggest advantage is its proximity to Lisbon, just a 45-minute drive away.
This allows you to enjoy a peaceful coastal life without giving up access to a major European capital. The expat community is active, with plenty of surf schools, yoga studios, and local events to join. It offers a perfect balance of tranquility and activity.
Historic and Affordable Inland Gems
For a truly immersive experience, consider Portugal’s historic interior. Here, you’ll find incredible value, rich culture, and fewer tourists.
8. Coimbra: The Soulful University City
Coimbra is the intellectual heart of Portugal. It’s home to one of the world’s oldest universities, and the student population gives this ancient city a vibrant, youthful energy.
The city is famous for its unique style of Fado music, sung by male students in black capes. Because it’s a university city, English is widely spoken, making it easy to settle in.
The cost of living in Portugal is very attractive here. A couple can live well for around $2,200 a month. Plus, Coimbra is a major medical hub with excellent hospitals.
9. Braga: Ancient Roots, Modern Vibe
As Portugal’s oldest city, Braga is steeped in Roman and Baroque history. Yet, it’s also a forward-looking city thanks to its universities and young population. It offers a wonderful mix of old and new.
You can explore magnificent sites like the Bom Jesus do Monte sanctuary. Or you can hike in the nearby Peneda-Gerês National Park, Portugal’s only national park.
Braga is very affordable, with a couple’s budget similar to Coimbra’s at around $2,200 a month.
10. Évora: Timeless Charm in the Alentejo
Step back in time in Évora, a stunningly preserved medieval town and UNESCO World Heritage site.
Located in the heart of the Alentejo region, it’s surrounded by rolling plains of cork oaks and vineyards. Life here is tranquil and deeply connected to Portuguese culture.
Évora is perfect for those seeking full immersion. The expat community is smaller, encouraging connections with local neighbors.
It is one of the most affordable options on this list. A couple can live comfortably on a budget of €1,500 to €2,000 per month.
Your Path to These Peaceful Places to Retire for Americans in Portugal
Moving to any of these amazing locations is more straightforward than you might think. Here’s a quick guide to the key steps.
Making It Official: The D7 Visa
The D7 Visa is often called the “Passive Income Visa.” It’s designed for retirees who have a stable income, like Social Security or a pension.
For 2025, the minimum income requirement is €870 per month for a single applicant. You’ll need to add 50% for a spouse and 30% for a dependent child.
You must also show you have a place to live (a 12-month lease) and open a Portuguese bank account. (Source: Immigrant Invest Portugal)
Staying Healthy: Portuguese Healthcare
Portugal has an excellent and affordable healthcare system. As a legal resident, you can join the public Serviço Nacional de Saúde (SNS).
Healthcare is free for residents over 65 and heavily subsidized for others. You will need private health insurance for your visa application.
Luckily, private plans are also very affordable, often costing just a fraction of U.S. premiums. This is one of the biggest financial benefits when you retire in Portugal.
Read More: 13 Countries Where Americans Find World-Class Health Care Good and Cheap
A Crucial Update on Taxes for 2025
It’s important to know that Portugal’s popular Non-Habitual Resident (NHR) tax program has changed. This program used to offer a low 10% tax on foreign pensions.
As of 2025, it is no longer available to new residents. This means your pension income will be taxed at Portugal’s standard progressive rates. (Source: Get Golden Visa)
While Portugal is no longer a low-tax destination for pensions, don’t be discouraged. The massive savings from the low cost of living in Portugal and affordable healthcare often outweigh the higher tax bill. It simply means you should consult with a tax professional to plan accordingly.
Your Portuguese Story Awaits
From the sunny beaches of the Algarve to the historic streets of Coimbra, Portugal offers a life rich in culture, beauty, and peace.
The path to these peaceful places to retire for Americans in Portugal is clearer than you think. It starts with a dream and comes to life with a single step.
Why not start exploring which of these ten perfect places could be the setting for your next chapter? Your story in the sun is waiting to be written.