In this article, we talk about the 25 cheapest countries in the world. To skip our in-depth analysis of how inflation affects the cost of living, go directly and see 5 Cheapest Countries in the World.
The UK just experienced double-digit inflation for the first time in forty years. Similarly, the consumer price index (CPI), a key indicator of US inflation, rose by over three times between 2020 and 2021, from 1.4% to 7.0%, after spending more than two decades below 3%. Despite a slight moderation in inflation to 6.0% in February, individual household budgets are under pressure, consumer confidence is suffering, and the cost of living is increasing.
Many consumers are putting financial limitations in place as a result of the growing cost of living. 47% of British consumers have already reduced or plan to reduce their overall spending as a result of inflation, according to data analytics company Kantar. 56% of American consumers, according to data by the information firm Morning Consult, are ready to shop less overall. Consumers are placing a higher value on staples over discretionary goods. The Procter & Gamble Company (NYSE:PG), PepsiCo, Inc. (NASDAQ:PEP), and The Coca-Cola Company (NYSE:KO) are some of the top consumer staples stocks during the current inflationary environment. These companies have consistent pricing power and offer consumers goods that are required regardless of the state of the economy. This is good for the investors, but not so much for the consumers.
The continuous supply chain crisis and the conflict in Russia and Ukraine are major contributors to the current high level of inflation, which is pushing up the cost of food, housing and energy prices. A typical household spends one-third of their income on housing. Housing costs have increased by 8%, roughly equal to the overall rate of inflation. Nonetheless, wages in the US climbed by 5.28% in December 2022 compared to the same month the year before. This suggests that the majority of people’s largest expense is increasing faster than their income. Likewise, food costs increased by 9.9% in 2022. Almost 12% of household spending goes toward food, making it clear that this is an essential expense that is rising faster than salaries. The price of diesel fuel, which has increased significantly more than the price of gasoline, is a hidden factor in food inflation. Many of the equipment used to produce food and the trucks that transport them run on diesel. The additional expense is being passed on to consumers by the producers.
All consumers, even retirees, are directly impacted by inflation in terms of their income, savings, and spending. For many people, the main concern about retirement is the cost of living. It is not unexpected that more people are choosing to retire abroad to cheap countries with a low cost of living, affordable healthcare, better weather, low taxes and a higher quality of life. Living overseas is a significant retirement ambition for 12% of Americans, according to the Aegon Retirement Readiness Survey 2021. But, while choosing a cheap country to relocate to, safety is also quite important.
We have produced a list of the cheapest countries in the world, but it is pertinent to note that due to the level of political unrest in most of them, they are also among the most dangerous nations in the world. Therefore, they are extremely unsuitable for retirees to choose while thinking about moving abroad. Having said that, let’s move to the 25 cheapest countries in the world. You can also check out 25 Best Countries For A Comfortable Retirement and 15 Biggest Retirement Mistakes You Will Regret Forever.
Our Methodology
For our list of 25 cheapest countries in the world, we’ve defined a cheap country as one with a low cost of living. For this purpose, we looked at the Numbeo’s Cost of Living Index by Country 2023. Numbeo is a crowd-sourced global database of statistics related to the quality of life, including information on housing indicators, perceived crime rates, healthcare quality, and transportation quality. In order to ascertain the cheapest countries in the world, we only shortlisted countries which ranked in the lower two quintiles of the report. Following that, we cross-referenced the resultant list with Economist Impact’s Global Food Security Index 2022 and averaged out the rankings to determine an average score for each country. For example, since Nigeria ranks 24th in the Numbeo’s Cost of Living Index and 7th in the Global Food Security Index, its average score for the purpose of this article is 15.5. We repeated the procedure for every country, then based on the average score, we selected the top 25 countries and ranked them from lowest to highest.
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Cheapest Countries in the World
25. Kazakhstan
NCLI Ranking: 17
EI GFSI: 82
Average Score: 49.5
In addition to the Caspian Sea and its architectural wonders, Kazakhstan is also famed for its wild horses. Compared to New York, the cost of living is 66% lower. In an ordinary restaurant, a square meal could cost around $6.
24. Turkey
NCLI Ranking: 16
EI GFSI: 65
Average Score: 40.5
Turkey is home to many well-known tourist destinations, like the historical Hagia Sophia and the dreamy hot air balloons of Cappadocia. The average rent in Turkey is 82.9% less than it is in the US. Without rent, a family of four is expected to spend $1,880 each month.
23. Morocco
NCLI Ranking: 21
EI GFSI: 57
Average Score: 39
Morocco, home to spectacular towns like Casablanca and Marrakech, is one of the countries with the cheapest cost of living. Depending on your lifestyle and budget, the cost of lodging in Morocco can change. The price range for a one-bedroom apartment is $245 to $550 per month. In Morocco, the cost of a month’s worth of basic utilities ranges from $35 to $88.
22. Indonesia
NCLI Ranking: 25
EI GFSI: 51
Average Score: 38
Compared to big western cities, Jakarta, the flourishing capital of Indonesia, offers a lower average cost of living. Typically, Jakarta has a 60% lower cost of living than London or New York. Without rent, the average monthly cost for a single person in Indonesia is $434.3. The projected monthly expense for a family of four is $1,515, excluding rent.
21. Azerbaijan
NCLI Ranking: 20
EI GFSI: 48
Average Score: 34
Azerbaijan has abundant natural resources, and its economy is primarily dependent on the export of oil and other forms of energy. The country has a high degree of economic development and literacy, making it an upper-middle income country.
With a cost of living that is 70% lower than New York’s, including 90% lower rents, it is also among the most affordable places to live and work. Azerbaijan’s average monthly cost of living, without rent, is $440. A typical fast-food meal in Baku costs $5.80.
20. Tunisia
NCLI Ranking: 11
EI GFSI: 52
Average Score: 31.5
Tunisia is one of the least expensive countries to live in and has gorgeous communities around the Mediterranean Sea. Tunisia is 65.9% less expensive than New York. A normal fast-food dinner will cost you roughly $4.80, whereas a meal at a modest restaurant will cost you about $2.85.
Major consumer staple companies operate in Tunisia. Most prominent of these include The Procter & Gamble Company (NYSE:PG), PepsiCo, Inc. (NASDAQ:PEP), and The Coca-Cola Company (NYSE:KO).
19. Paraguay
NCLI Ranking: 19
EI GFSI: 44
Average Score: 31.5
Given its low average cost of living, Paraguay is regarded as one of the most affordable places to live in Latin America. The average cost of living in Paraguay is 59.9% lower than in the United States. Without rent, the expected monthly expenses for a single person are $424.8 in the country.
18. Algeria
NCLI Ranking: 15
EI GFSI: 46
Average Score: 30.5
Algeria, one of the world’s cheapest countries, has a mild climate that runs from the Sahara Desert to the Mediterranean coast. The average cost of living in Algeria is $439, which is 80% less expensive than the US.
17. Kosovo
NCLI Ranking: 18
EI GFSI: 40
Average Score: 29
In spite of its turbulent past, Kosovo is generally a secure place to live. In January 2023, the price of food rose 17.9% year-over-year in January 2023. Kosovo’s current inflation rate is estimated to be as high as 20%.
16. Uzbekistan
NCLI Ranking: 14
EI GFSI: 41
Average Score: 27.5
Uzbekistan, a low-income nation, is located in the heart of Central Asia. Even though it is not as inexpensive as other Central Asian countries, Uzbekistan is still quite affordable by Western standards. In this country, an average international student will spend $400–$500 a month on housing, food, clothing, entertainment, transportation, and telephone.
15. Colombia
NCLI Ranking: 4
EI GFSI: 50
Average Score: 27
The exquisite Arabica coffee, top-notch emeralds, and exotic fruits that are produced in Colombia are world-renowned. According to the International Monetary Fund, Colombia has one of the largest economies in Latin America and is categorized as an upper middle-income country.
The low cost of living in the country is one of the key advantages of living there. Colombia’s average cost of living is 68.5% less than that of the United States. With a monthly income of $900 to $2000, the majority of foreigners can live comfortably.
14. Ukraine
NCLI Ranking: 8
EI GFSI: 43
Average Score: 25.5
Given its optimal growing conditions for wheat, Ukraine is often referred to as the “Breadbasket of Europe.” Prices of a number of commodities, including fertilizers, food items, oil, and gas, increased as a result of the Russia-Ukraine war. Without rent, a single person’s expected monthly expenses total $437.6. The average rent in Ukraine is 82.6% less than it is in the US.
13. Kyrgyzstan
NCLI Ranking: 9
EI GFSI: 41
Average Score: 25
Kyrgyzstan, a land-locked, lower-middle-income country, is famous for its walnut-fruit forests. As a nation rich in culture and history, it is a desirable place for expats to live. The average cost of lodging in Kyrgyzstan is between $15 for a hostel and $48 for a three-star hotel. The average rent in Kyrgyzstan is 79.6% less than it is in the US.
12. India
NCLI Ranking: 3
EI GFSI: 46
Average Score: 24.5
Despite the incredible Indian food in New York City, moving to India will result in significant food cost savings of 81%. The average monthly cost of living in India is between $330-$420. The estimated monthly costs for a single individual, excluding rent, are $311. That makes it one of the world’s most affordable places to live.
11. Rwanda
NCLI Ranking: 22
EI GFSI: 26
Average Score: 24
Most people in Rwanda, particularly foreigners who often make more money than locals, can live comfortably. Living expenses in Rwanda are typically 59.6% less expensive than in the US. The average price of a fast-food meal in Rwanda is $7.40.
10. Tanzania
NCLI Ranking: 23
EI GFSI: 24
Average Score: 23.5
Tanzania, a low-middle income country in East Africa, is primarily dependent on agriculture. The country has more affordable prices for everyday items than the US. Tanzania’s average cost of living is 57.7% less than that of the US.
9. Nepal
NCLI Ranking: 6
EI GFSI: 40
Average Score: 23
From the lowland jungles to the snow-capped heights of Mount Everest, Nepal offers a lifetime’s worth of adventures. Rents are 96% cheaper across the country than in New York. For $500 per month, you may have a pretty nice lifestyle in Pokhara and Kathmandu.
8. Bangladesh
NCLI Ranking: 12
EI GFSI: 34
Average Score: 23
Home to Bengal tigers, Bangladesh is one of least expensive countries to live and work, with a cost of living that is 68% less than New York. The average cost of food in Bangladesh is $10 per day, although meal prices may vary. A typical fast-food meal in Bangladesh costs around $4.80.
7. Ghana
NCLI Ranking: 13
EI GFSI: 31
Average Score: 22
Life in Ghana is extremely affordable if you come from a developed nation. You can expect to pay around $3.50 for a basic meal or about $13 for a higher quality 3-course meal. On average, rent in Ghana is 68.8% less expensive than rent in the US.
6. Egypt
NCLI Ranking: 2
EI GFSI: 40
Average Score: 21
You can actually live for less money in the land of the Great Pyramids. The cost of travel through Egypt is comparable to that of travel through Southeast Asia. Cairo costs 76.6% less than Seattle. The projected monthly expenses for a family of four, excluding rent, are $1,130.6.
Click to continue reading and see 5 Cheapest Countries in the World.
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Disclosure. None. 25 Cheapest Countries in the World is originally published on Insider Monkey.