Is Life Really Cheaper in Portugal? A Cost of Living Comparison: Lisbon vs. Austin, TX

16Are you curious about the Portugal cost of living compared to the US? Specifically, how does Lisbon compare to Austin, TX, when it comes to everyday expenses? This post breaks down the cost of living in both cities, helping you decide if Portugal is the right choice financially.

Let’s dive into the numbers — and what they actually mean for your lifestyle — by comparing two dynamic cities: Austin, Texas, and Lisbon, Portugal. Using the latest data from Numbeo, here are the highlights.

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💰 Overall Cost of Living

Lisbon comes out as significantly more affordable than Austin:

• 15.3% cheaper in overall living costs (excluding rent)

• 17.3% cheaper when rent is included

• 16You’d need about $5,460 (€4,661) in Lisbon to match a $6,600 lifestyle in Austin

This makes Portugal an appealing destination for digital nomads, retirees, and anyone looking to stretch their income further—especially if they earn in USD or EUR.

🏠 Rent & Housing

Housing in Lisbon is generally much cheaper than in Austin. Renting a one-bedroom apartment in Lisbon’s city center typically costs between 800 and 1,200 euros per month, while in Austin, similar apartments can easily cost $1,500 or more. So, if rent is your main concern, Portugal offers a clear financial edge.

Here’s a quick look at the rent differences:

Outside the city centers, the savings remain significant, though slightly smaller.

🍝 Dining Out

Eating out in Portugal isn’t just cheaper—it’s a cultural experience:

• A typical meal at a local restaurant costs about 20% less

• Cappuccinos are 50% cheaper

• Imported beers cost over 50% less

You can enjoy daily coffees, lunch menus, or a glass of wine with dinner without stretching your budget.

🛒 Grocery Shopping

Groceries in Lisbon tend to be less expensive, particularly fresh produce and local items. To illustrate:

Not only are local produce and wine fresher in Portugal—they’re also dramatically more affordable.

🚗 Transportation

Lisbon offers affordable and reliable public transportation. A monthly transit pass costs roughly 40 euros, while Austin’s public transit is less developed, and many residents rely on cars, which adds costs for gas, insurance, and parking.

However, there’s a catch: gas prices in Portugal are over 170% higher. That said:

• Taxi fares in Lisbon are much lower

• Public transit is widespread and affordable

• Monthly passes cost about $47 in Lisbon (vs. $43 in Austin)

If you don’t depend on a car, you’ll likely save money overall in Lisbon.

📱 Utilities & Internet

Utility bills like electricity, heating, and internet tend to be lower in Lisbon. Typical monthly costs range from 80 to 120 euros, while in Austin, bills can exceed $150. Additional savings include:

• Mobile phone plans are 63.8% cheaper in Lisbon

• Internet costs are around 40% less

• Utilities for a standard apartment are roughly 15% cheaper

💸 Salaries & Local Purchasing Power

Here’s the downside:

• Average salaries in Lisbon are about 70% lower than in Austin

• Local purchasing power is 63.9% lower, meaning residents earn less and spend more of their income on essentials

For locals or expats earning in euros, this can limit lifestyle options. However, if you work remotely or have passive income in USD/EUR, this disparity won’t impact you as much.

🧾 The Bottom Line

Portugal is more affordable across nearly all expense categories—rent, food, utilities, dining, and more—though local incomes are substantially lower. Despite this, Lisbon remains one of Western Europe’s best value capitals.

So, if you plan to relocate with a remote job or pension paid in USD/EUR, Portugal is an excellent financial choice.

👉 Besides the cost of living in Portugal, want to understand what documents you need to move? Don’t miss our complete guide for the D7 Visa in the post: D7 Visa Portugal: How to Legally Live in Portugal on Passive Income or Retirement