I went to the ATM yesterday and asked for $200, and got it all in $5 bills! Usually the ATM gives $20 bills but sometimes you run into someone who doesn’t have that much change, so I’m not unhappy about the $5 bills or the wallet that is too fat to close.
But, this got me to thinking about how to manage money if you live here. There are many ways and you will certainly get different opinions from different people, but this is what has worked well for us.
We have found it very helpful to maintain a US address for banking and other business (We live in California with my daughter and travel a lot 😉 ). If there is something important she can click a photo of it and email it to me. It is very rare that she has to physically send something down here. Keep in mind that if you have stock market investments, it is possible that your bank or investment company won’t even allow you to continue to do business if you have a foreign address. We like Schwab because they refund our ATM fees, and I have been happy with their service overall for many years.
Supermarkets and large stores take credit cards (If you are not a resident, your passport serves as your ID when needed). Roadside markets and smaller shops need cash. Our social security payments are deposited in our US Schwab account. We pay credit cards and other bills on line and get cash as needed from an ATM. You can operate this way indefinitely without a Panamanian bank account.
Joel and I have separate accounts and three active credit cards each. I have known people who come here with only one or two credit cards and then if there is a problem, it can be a huge problem! We have things set up so we can move money between accounts and between banks, so hopefully we will never be left without access to our money. There is Western Union here though in case someone is really stuck and needs money sent to them.
We were considering buying a bit of property in the past and wanted to establish a relationship with a Panamanian bank. We were introduced to someone at Scotia bank by a Panamanian friend, and went through the process of collecting all the necessary documents (letter from our US bank, proof if income and/or tax returns, letters of recommendation both professional and personal, filling out lengthy forms… it was a while ago so I probably forgot something but you get the idea). It was a process but we were successful in getting Panamanian bank accounts, so we each now have a savings and checking account at Scotia Bank. We were not residents at the time, and I have heard the process is easier after you get residency.
Having a Panamanian account has been convenient at times. I can refill my phone time on line, rather than going to the office or buying a card somewhere. I have had to pay a few people and I can transfer money from my Panamanian account to theirs. Some bills are even paid this way, by transferring money from your account to the company account. One thing was different though. I discovered my debit/credit card was using the money in my savings account, not the checking account. This isn’t a problem as long as I know, but I was a bit confused at first when my card said I was about out of money.
We have not financed a car, property, or other large purchase in Panama so I can’t say anything about how that would work. But, for our daily lives this arrangement has worked well for us.
The Panama Adventure 
We are pretty much in line with you guys. We also use Charles Schwab…can not say enough great things about them!
Also we use Barclay Credit card…earn 2 miles for every dollar spent, no black out dates, no expiration of your miles and no foreign transaction fees!
Having a local bank is very convenient. We use Banco General. Great service and no fees!
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Yep, Schwab, good people. The Barclay card sounds interesting. I have a United card but of course its only good for that airline which doesn’t always have the best deal.
I have heard good things about Banco General too. There is one bank that charges expats hefty fees because they have to deal with all the IRS requirements but I don’t remember which one.
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Multi Bank… we lasted 2 months with them and it was very difficult in opening an account. Took over a week and 5 return visits!
Banco General was done in 2 days.
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We had three visits, one to find out the requirements, one to submit the documents, and another maybe a week later to wrap everything up.
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very helpful, we were just discussing this yesterday … thanks Kris I hope we can meet someday when we get down there, a couple yrs a way most likely
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We have no intentions of moving out of Panama so we should be here when you get here.
Glad you found the post helpful.
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We have also learned of a very easy & fast way to make cash payments here in Panama – using the country’s Post Office. Yes you read right, the Panamanian postal system. Simply go to any branch, give them the name – Micky Mouse, and the branch (which is) Mousehole, Panama, and for a small fee the money is transferred in 1 or 2 days. Simple and less expensive than Uno Express or Western Union.
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Seriously? I can never tell when someone is joking. Mousehole? I know there are services where an individual can send money to another person (within Panama). I’ve gone with friends to the customer service desk in the supermarket for this. For a business you can go to Banco General, i think it is, deposit money in the business account and get your receipt as proof of payment. If you don’t have email I’m not sure what comes next. Send the business a paper copy? We have used Uno Express to send important documents but I didn’t realize they also send money. I think Western Union is the best option for someone out of the country to send money to someone in Panama.
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I love using the PO. but sometimes when I send to a really small town they have to check first by phone to see if the PO has enough money to disburse. IN my experience the receiver usually gets the money later the same day.
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Ahh, so it is for real Thanks. I’ll keep this in mind
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I have been reading your blog for awhile now…entertaining reading and all the cycling trips sound great.
I visited Panama once and found myself there Sunday for an enforced overnight since Hurricane Matthew prevented landfall in Aruba…sorry to say the climate just doesn’t agree with me and can’t imagine retiring here.
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Thanks! Glad you enjoy the blog.
This is the tropics and it’s hot and humid, or cooler and humid at higher elevations. If you don’t enjoy that then no, this wouldn’t be the right place for you. I hope you find someplace you love.
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Hi DD,
Spending the night in Panama City on a stopover is much like being in Miami and declaring the USA isn’t for you. Panama has endless variations of climate with only the rainy and dry seasons being constant. Best part of Panama is no hurricanes.
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Also Kris there are numerous stores that accept payments for bills of the major companies. y For example you can pay cable and electricity at these locations. My convenience store next door processes payments! You an also send money and things by bus to many locations. For this you need to go to the bus station in David. Fast and cheap.
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Yes indeed. You can pay pretty much anything in the supermarket here (El Rey) and I know there are other similar places around town. I’ve had friends put things on the bus to be delivered too. Some things are more complicated here, but some things are a lot easier and cheaper.
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Kris, thanks for another useful and timely post. A word for folks new to Panama, or any ‘foreign’ spot, we recently had a CC purchase denied because we’re in Panama, despite notifying the card’s admin folks that we were here. It seems they assume, for our safety of course, that continued use of the card is some sort of fraudulent activity. So people need to assure their card sponsor that they really, really do live wherever they find themselves.
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Very good point! (and another reason to have more than one credit card, just in case). I remember for a while I had to contact my main CC every month to inform them of my location.
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Hola Kris,
Since we only visit family for a few weeks each year, we don’t take much cash with us. Our method is to do grocery shopping for the family with whatever money they give us then keep the cash and spend twice that much on our credit card. We get waking around money and their larder is full for a week. Like most families, they shop several times a week for smaller quantities so it saves them a few trips. Expats, especially from the US, are used to shopping for a week’s groceries which is why they frequently find shortages. Shopping several times a week gives one more chances to find the shelves recently stocked.
Nena and our niece do have a joint bank account (Nena still has her cedula) so sending money to there is easier. The post office transfer in country is the real deal. You just have to call the person that you are sending money to so that they know to go to the post office. We write phone numbers on the address label of packages we send for the same reason; the post office clerk calls them to come get the package.
jim
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Yes indeed, we are used to shopping once a week. When I was working and busy that’s all I had time for. I also did most of the cooking and any other chores on the weekend because of time constraints. I don’t miss those days!
Cool thing about the post office.
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Useful information Kris. Money terrifies me. I wish we could go back to using sea shells for payment, or the barter system.
On another note (somewhat related since it has to do with money) I read a comment to a post on Don Ray’s blog that wasn’t answered, and wonder if you know the answer: namely, that the SSA taxes all Social Security payments 30% if the recipient resides outside the USA – in Panama for instance. True or not true? – thanks, and apologies for the slightly off topic question. – Wendy
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Not true. You have to file taxes and pay if your income warrants it, but it’s the same wherever you live.
If we used sea shells then we would be afraid of sea shells 😀 I’m all for the barter system though whenever possible. Unfortunately that doesn’t work with the electric bill or the supermarket.
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That’s a relief to know about the SS taxes. Yes the sea shells and barter system were admittedly mere pipe dreams. One can dream. 😄
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Of course! And there are always some possibilities for barter.
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