What Is The Cost Of Living In Bahamas Vs. USA?

Located between Florida and Cuba, the Commonwealth of the Bahamas is an island nation of nearly 700 islands. Moving to the Bahamas is a popular option among Americans looking to leave the United States. The Bahamas is appealing due to its close proximity to the U.S., its significant expat community, and the fact that it essentially embodies the idea of an island paradise. If you’re considering life in the Bahamas, knowing the cost of living can help you prepare.

Cost of living is a major factor that people use to determine whether they want to live in one place versus another. So, when it comes to the Bahamas vs. the United States, how do these two countries stack up in terms of cost of living? Since cost of living varies quite a bit based on where you live in either country, it can be difficult to perform an accurate comparison.

However, the consensus is that the Bahamas is between 20 and 30 percent more expensive than the United States. The cost of living index in the Bahamas is 84.32, while the cost of living index in the United States is 70.55. Estimated monthly costs for a family of four in the Bahamas is $6,617, compared to $4,750 in the U.S. Whereas, the estimated monthly costs for a single individual in the Bahamas is $2,777, but it’s $3,335 in the United States.

With this in mind, let’s take a deeper look at how the cost of living compares in Bahamas vs. USA.

If you want to become a legal resident in the Bahamas, the easiest way to do so is to purchase property and obtain a Home Owners Resident Card. Your other options are to pay $100 for an annual residency permit or wait several years until you are eligible for permanent residency. Like residency, citizenship is difficult to get in the Bahamas.

The main drawback is that the government in Nassau does not recognize dual citizenship. Applicants must renounce all existing allegiances before they even start the application process. The categories of those eligible for citizenship in the Bahamas is persons born on the islands, persons whose parents are citizens, legal residents of ten years or longer, and persons married to citizens.

Like most countries, the Bahamas is home to people in a wide variety of social classes, and the prices in the real estate market reflect that. Similar to the United States, areas that are primarily middle-class in the Bahamas, consisting of apartment buildings and single-family house, are drastically less expensive than areas that feature beachfront estates and luxury mansions.

Though, since the standard of living in the Bahamas is high, the price of real estate is also pricey. The most expensive homes are generally found in the capital city, Nassau, as well as Freeport, which is a major city in the Bahamas. You’re looking at the following property prices in the Bahamas, based on square footage:

Finding long-term rental accommodations in the Bahamas can be a challenge, as rental properties tend to only be leased out for a short period of time to accommodate tourists. Though, it’s not impossible to find an apartment if you are a foreign national residing in the country for work purposes. Most rental accommodations in the Bahamas are located in major cities, such as Nassau and Freeport.

The following table outlines the average monthly rent for an apartment in the Bahamas vs. USA, based on proximity to the city center.

For many years, the Bahamas has been seen as a tax haven. The island nation has no corporate tax, in addition to capital gains, estate, wealth, or even income tax for both residents and citizens. However, those who work in the Bahamas are required to pay monthly contributions to the national insurance, which finances the country’s benefit system. Bahamians pay VAT, or added-value-tax, at a rate of 12%.

Other types of taxes that are levied in the Bahamas include a real estate tax and stamp duty. The real estate tax that you pay depends on the category of the property. If the owner lives on the property, they do not have to pay tax for properties worth $250,000 USD and under. However, if the property is worth more than $250,000 USD, a real estate tax of 0.75% is applied. Stamp duty is paid in the Bahamas when purchasing real estate or sending a large amount of money abroad, ranging from 2% to 8%. Though, charges for remitting money overseas are usually at 0.25%.

In the United States, however, taxes are levied on income, payroll, sales, capital gains, property, imports, dividends, estates and gifts, in addition to a variety of fees.

As food and groceries are expenses that people encounter on a daily basis, the overall grocery and food index is another factor that impacts the cost of living in a particular location. The grocery index in the Bahamas is 70.63, while the grocery index in the United States is 69.87.

This means that you’d enjoy a marginal savings of about 1.07% on groceries if you live in the United States instead of the Bahamas. Refer to the following table for a more detailed look at the average prices of groceries in the Bahamas vs. USA.