A high pension does not always mean a comfortable life. In some countries with lower benefits, you can afford more thanks to lower costs. Find out more about where in Europe retirees can live more comfortably

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At first glance, it seems simple: the higher the pension, the better the standard of living. But the reality in Europe is much more complicated. Countries with the highest pensions often have the highest costs, from rent to utilities. As a result, pensioners can spend most of their income only on basic needs.

In southern Europe, however, the situation is the opposite: pensions are lower, but life is cheaper, the climate is milder, and everyday expenses are much more affordable. That is why more and more people are paying attention to the real purchasing power of their pensions rather than the pension amount.

In our previous article, we talked about the top 10 countries for retirement and comfortable living abroad.

Are you planning to move, work or stay in the EU for a long time and don't know where to start?

To avoid getting lost in the changes to visa and migration policy, use the immigration guide from Visit World. It contains up-to-date information on obtaining a residence permit and citizenship in different countries, step-by-step instructions, requirements for applicants, a list of documents, deadlines and costs. The guide will be sent to your email in PDF format in just a few minutes and will help you plan your legal move without unnecessary stress.

Where are the highest pensions in Europe?

In Europe, the level of pensions varies significantly depending on the country, economy, and social system. Traditionally, the highest payments are offered by countries with a developed social security system, but the cost of living increases along with income.

Countries with the highest average pensions include:

1. Sweden - about 1850 € per month

2. Italy - about 1600 €.

3. Germany - an average of 1500 €.

4. France - about 1400 €.

These figures look attractive, but they do not reflect the full picture. For example, in Sweden, a significant portion of the pension is spent on basic expenses: housing, utilities, and daily purchases can range from €850 to €1,000, and additional utility costs can be up to €200 or more.

In Germany, the situation is similar: expenses often reach about half of the pension, especially in large cities. In Italy, basic monthly expenses can be around €800, depending on the region and lifestyle.

Thus, even in countries with high pensions, the real standard of living depends not so much on income as on the ratio of income to expenses. It is this balance that determines how comfortable you can live in retirement.

In the previous article, we provided information on the most expensive cities in the world to live in in 2026 according to Numbeo.

Where it is cheaper to live even with a lower pension

Not all countries with high pensions provide a comfortable life. In many cases, it is not the amount of payments that plays a decisive role, but the level of daily expenses, from housing to food and transportation.

European countries with moderate pensions but lower costs often prove to be more favorable for living:

1. Spain - the average pension is about 1100 €, while monthly expenses can be about 750 €

2. UK - about €1300, but the standard of living is heavily dependent on additional sources of income, including private pensions

The example of Spain is particularly illustrative: despite lower payments than in northern Europe, living costs are significantly lower here. This allows people to save most of their income or spend it on comfort, such as travel, leisure, and quality healthcare.

Countries with warmer climates also have lower utility costs, especially heating. In addition, the cost of groceries, rent, and services is on average lower than in northern Europe.

As a result, even with a smaller pension, you can live more comfortably than in countries with high incomes but expensive living standards. That is why it is important to assess not only the amount of payments but also the real purchasing power when choosing a country.

Earlier, we talked about the top 10 countries for a comfortable retirement with a budget of up to $3,000 per month.

Why it's not the size of the pension that matters, but the balance

At first glance, it may seem that countries with the highest pensions are automatically the best places to live. But in practice, the decisive factor is not the income itself, but how much money is left after mandatory expenses.

In Northern and Western Europe, high pensions are often accompanied by a high cost of living. A significant portion of income is spent on housing, utilities, healthcare, and daily purchases. As a result, even with a pension of more than €1500, the financial margin can be limited.

In contrast, the situation in southern European countries is different. Although pensions are lower there, the costs of basic needs are also much lower. This allows you to allocate your budget more efficiently and maintain a comfortable standard of living even with a lower income.

The so-called balance between income and expenses plays a key role. It can be conditionally described through several factors:

- The ratio of pension to housing costs

- The level of spending on groceries and basic services

- Utility bills and seasonal expenses

- Accessibility of healthcare and insurance

It is this balance that determines whether you have enough money not only for basic needs but also for the quality of life: travel, recreation, and social activities.

The best countries in Europe for retirement

Europe offers several destinations that combine relatively affordable living, a comfortable climate, and developed infrastructure. These factors make them popular among those planning to spend their retirement years abroad.

Portugal

Portugal remains one of the most affordable options for retirement living thanks to its program for people with passive income. To move, you need to confirm a regular income of approximately €870-1300 per month per person, as well as the availability of housing (rent or ownership). It is important that at the initial stage, no language skills are required.

The average cost of living outside of Lisbon and Porto can be €800-1200 per month, including rent, food and utilities. After 5 years of residence, you can apply for permanent status.

Spain

Spain offers a status for financially independent persons, which is suitable for living without employment. The main requirement is to confirm an income of about €28,800 per year (approximately €2,400 per month). You also need to take out health insurance and confirm your place of residence.

The average cost is approximately 700-1000 € per month in small cities and from 1200 € in large cities. Work with this status is not allowed, but after 5 years you can get a long-term residence permit.

Italy

Italy has a separate program for persons with passive income, where the key requirement is to confirm approximately €31,000 per year per person. The source of income can be a pension, dividends or rent. Health insurance and housing are mandatory.

Costs vary significantly by region: in the southern regions, basic expenses can be around €800-1000 per month, while in the northern regions they are much higher. After 5 years of residence, the possibility of obtaining permanent status opens up.

Greece

Greece offers two main options: residence for financially independent persons or an investment program through real estate. In the second case, you need to invest from 250,000 € (in some regions, the threshold is already higher).

The advantage is that permanent residence in the country is not required. The cost of living here is relatively low: an average of €700-1100 per month, depending on the city and lifestyle. Pension income is used as proof of financial solvency.

Finland

Finland is not an option for moving from scratch, but for those who already live in the country. After 3 years of legal residence and reaching the age of 65+, you can apply for a social pension (Kela).

However, it should be borne in mind that the costs here are among the highest in Europe: basic monthly expenses can exceed €1200-1500, excluding rent in large cities. At the same time, the country offers a high level of healthcare, security and social protection.

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You can find up-to-date and structured information on obtaining a residence permit or citizenship in any country in the immigration guide from Visit World. In PDF format, you will receive step-by-step instructions, a list of documents, costs and processing times, applicant requirements, rules for filling out forms, practical advice and status benefits — all delivered to your email in just a few minutes.

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We remind you! Electronic travel authorisations, extended visa-free travel, digital arrival cards instead of paper forms — in 2026, border crossing rules in many countries will change again. Travel will not become more difficult, but it will require more advance preparation. Read about the new travel rules in 2026 at the link.

Products from Visit World for a comfortable trip:

Travel guide for 200 countries;

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Medical insurance all over the world.

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