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In the often confusing world of retirement planning, picking the right investment options for retirees is essential. Here are the top 5!

Last Updated on December 11, 2023 by Laila Oliveira

Expats who choose to retire in Portugal are often plagued with the dilemma of capital preservation or investing for potential growth. With so many investment options available now, picking the right investment options as a retiree in Portugal is often easier said than done.


From popular options like Investment Funds for Golden Visa to technology-related investment, we break down each option for the sake of our readers. This guide delves into the “Top 5 Investment Options for Retirees,” offering insightful perspectives tailored for the average individual with little to no experience.

By exploring the intricacies of these investment vehicles, retirees can make informed decisions tailored to their unique financial goals. Tag along as we explore some of the top investment options for retirees that will provide financial security during your stay in Portugal!

Why do people spend their retirement in Portugal?

Over the last couple of years, Portugal has been a hot topic not just among short-term tourists but also among retirees. As per the 2023 Annual Global Retirement Index from International Living, Portugal ranks among the top retirement destinations for retirees worldwide.

People often spend their golden years in Portugal for various reasons. For some, it is the Mediterranean climate characterized by mild winters and warm summers. This favorable weather particularly appeals to retirees looking to spend their time outdoors basking on the beach, hiking, or exploring the country’s rich history. 

Another popular reason why Portugal is so appealing to retirees has to do with the cost of living. Retirees who choose to live in Portugal often find that every penny in their pension stretches further than it would in other Western countries.

This, in turn, allows them to lead a comfortable lifestyle without too much financial strain. Another common draw for retirees to Portugal is the cultural richness.

Portugal is immersed in a wealth of history and culture, providing retirees with diverse traditions, festivals, and a relaxed way of life. The inclusive and amiable local communities facilitate a seamless integration for expats, fostering a sense of belonging and comfort.

Passive Income Visa

The D7 Visa in Portugal is a residence visa designed for individuals who wish to live without formal employment. It is particularly popular among retirees and individuals with passive income, such as pensions or investments.

To qualify for the D7 visa, applicants must demonstrate a regular source of income, such as pensions, rental income, or other forms of passive income.

The amount required may vary, and it is advisable to check the latest financial criteria set by Portuguese authorities. The application process involves submitting various documents, including proof of income, proof of accommodation, health insurance, and a criminal record certificate. The application is usually made at the Portuguese consulate or embassy in the applicant’s home country.

Documents needed in general

  • Passport: Copy of the Passport profile page.
  • Proof of Passive Income: Documents that prove the monthly passive income.
  • Personal Statement: Specifies the reasons for applying for the visa, the period intended to reside in Portugal, and the place of accommodation.
  • Proof of Means of Subsistence: Proof of income that allows residence in Portugal for at least 1 year.
  • Proof of Accommodation: Corresponds to purchasing or renting a property in Portugal. In some cases, an invitation letter signed by a resident of Portugal is enough.
  • International Travel Medical Insurance: It must be valid for the period of residence in Portugal. 
  • D7 Visa form: Complete form. 
  • Criminal Background Certificate: This document must be related to the applicant’s country of residence by local regulations.

Top 5 Investment Options For Retirees

As mentioned earlier, there are so many paths to follow regarding investment options for retirees. However, in a bid to point you in the right direction, here’s a breakdown of five of our top 5 investment options for retirees.

Investment Funds for Golden Visa

The investment funds for Golden Visa have to be the first on the priority list because it essentially kills two birds with one stone. It not only serves as an investment option to future-proof your funds but is also an option for securing the sought-after Golden Visa.

This particular option has become quite popular since the government recently removed investment in real estate as an option to obtain the Golden Visa. But what exactly are investment funds specifically for the Golden Visa?


Well, this involves an investor transferring capital in investment or venture capital funds that amount to €500,000 or higher. These funds are focused on the capitalization of recognized and registered companies under Portuguese law. The good news is that this type of investment is controlled and regulated by the Portuguese Securities Market Commission (CMVM).

Investments tend to fluctuate up and down. However, this is a good option to preserve capital and potentially get a good return on your investment. Once you qualify, the investment funds option of obtaining the Golden Visa is almost hands-free, making it one of the good investment options for retirees. There are no subsequent hefty fees and tax obligations compared to choosing to go through the real estate acquisition path.

It is worth mentioning that while the returns are often higher compared to other options, this path is also riskier. Proceed with caution and consult professionals for this purpose. 

How to get the Golden Visa

The Golden Visa is a program the Portuguese government offers qualifying investors a residence permit and a chance of getting citizenship. Despite the name, this program is not a visa but a Residence Permit for Investment Activity.

With that in mind, you can expect the application process to be different too. Getting the Golden Visa through investment funds or any other path will require you to seek the services of a professional.

There are too many legal and other unfamiliar lingo that might need interpretation. The application is not made through the consulate but through the Foreigners and Borders Service (SEF).

The application process is often not long. However, the typical Portuguese bureaucracies might cause long delays. Nonetheless, take a look at the steps you must take during the application to give you a better understanding of the process:

  • Provide the management company with a KYC form, identification details, and a subscription form;
  • You will get your NIF number, then go ahead and open a Portuguese bank account;
  • Transfer the required sum of money from your foreign to a Portuguese bank account;
  • The next step is to order your Portuguese bank to transfer the money to an investment firm bank account;
  • The fund management company then issues a declaration necessary for the application of the Golden Visa;

Here are some of the documents you will need to provide.

  • Valid identification document like a Passport;
  • Certificate of commercial registration if you made payments via a single company shareholder;
  • A declaration from the specific fund management company stating the feasibility of the capitalization plan and maturity of at least five years;
  • Declaration from a recognized Portuguese financial institution demonstrating that the minimum investment funds have been transferred effectively;
  • Supporting documents.

Pension Funds

Pension funds can be a strategic investment option for retirees residing in Portugal, contributing to long-term financial stability during retirement. Portugal has its pension system, and expatriates may be eligible to participate based on their employment status.

Besides the pension plans offered by the government, expats can seek private pension plans provided by various financial institutions. These plans, known as personal pension funds or individual retirement savings plans, allow individuals to make voluntary contributions to build their retirement savings. This is particularly helpful for the expats who are employed and are looking to direct their contributions towards a pension program.

If you have pension assets from previous employment in your home country, be sure to research the cross-border implications of managing and consolidating pension funds.

Lastly, be sure to consult with financial professionals knowledgeable about local and international financial matters. They will help you navigate the complexities of pension planning in your newly adopted country.

Technology-related business investment

Other than investment and pension funds, another uncommon type of investment expat retirees in Portugal can explore is tech-related business alternatives. Considering the rapid advancement in the technology industry, choosing to invest in such a field could yield growth potential.

One option that is not completely new is investing in Tech stocks. Big tech firms like Microsoft, Apple, and even Google have a track record of providing stable returns over time.

Investing in technology startups through venture capital is another good alternative for retirees. While this is a higher-risk choice, it can also offer substantial returns if the startups succeed.

Be sure to conduct thorough due diligence and be aware of the associated risks. Before making any technology-related investments, be sure to understand your risk tolerance, investment goals, and time horizon. Do not shy away from consulting with professionals and also doing your research.

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Tech fields in demand

Knowing where to put your money is crucial, as with any other investment opportunity. In that regard, some of the technology fields that are showing great potential and are worth looking at include the following.

  • Artificial Intelligence (AI)
  • Cloud computing
  • Cybersecurity
  • E-commerce and Online Retail
  • 5G Technology
  • Renewable Energy Technology

Real Estate

Let’s face it: real estate is one of those age-old investment alternatives that you can never go wrong with if you play your cards right. Portugal’s real estate investment market is looking quite appealing to foreign investors for a few reasons: affordability, strategic location, and steady growth.

There are so many reasons to invest in the real estate industry in Portugal as a form of retirement plan. One of those reasons is because of the demand for housing thanks to the influx of expats and the ever-increasing tourism in the country.

The demand for rental accommodations, driven by a flourishing tourism sector and a rising influx of international residents, establishes a positive setting for property owners.

Real estate can be a valuable component of a diversified investment portfolio. It can provide a hedge against inflation and market volatility. However, you should consider diversifying your investments across different asset classes for risk mitigation.


Cities with good real estate options

Several cities in Portugal are considered attractive for real estate investment due to factors such as economic growth, tourism appeal, and lifestyle amenities. 

However, before choosing just any other city in the country, it is important to consider factors like the demand, budget, and individual objectives for the investment. Nonetheless, here are some of the cities that are popular as investment options for retirees.

  • Lisbon – Portugal’s capital, Lisbon, is a popular destination for real estate investment. It offers a vibrant cultural scene, historic architecture, and diverse neighborhoods.
  • Porto – The city’s real estate market has shown resilience, and areas like Ribeira and Foz do Douro are particularly popular among investors.
  • Cascais – A coastal town near Lisbon, is renowned for its upscale lifestyle, beautiful beaches, and proximity to the capital. It attracts both local and international investors, especially those seeking high-end properties.
  • Albufeira – Situated in the Algarve, Albufeira is a well-known tourist destination with beautiful beaches. The tourism industry in the area is the main appeal for real estate investment.

Fixed deposits

If your risk tolerance is small, one option you have regarding investment options for retirees is fixed deposits. A fixed deposit is an arrangement where an investor deposits money in a bank or financial institution for a predetermined period, known as the term.

In return, the investor receives a fixed interest rate on the deposited amount. The capital invested is typically secure, and investors are assured of receiving the principal amount and the agreed-upon interest at the end of the term.

One advantage of fixed deposits is that they can be structured to provide regular interest payouts, offering retirees a consistent income stream. This particularly benefits retirees who rely on their interests to cover their monthly expenses.

On the flip side, one potential drawback is that fixed deposits may not always keep pace with inflation. If the interest rate is lower than the inflation rate, the real purchasing power of the returns may decrease over time.

What is the tax system in Portugal like?

The tax structure in Portugal encompasses state and local levies, typically computed according to earnings, spending, and property possession. State or Federal taxes include taxes on wages for employees and self-employed individuals, corporate taxation, value-added tax (VAT) for businesses, capital gains taxation on the sale of assets, including properties, and estate taxes on inheritances.

Local taxes, on the other hand, are charged at the municipal level, particularly the IMI (Imposto Municipal sobre Imóveis), Portugal’s equivalent of council tax.

As an expat, your tax liability is based on the length of your stay in the country. Staying for more than 183 days within a calendar year renders you liable to pay income tax for your income within or away from Portugal.

The tax system for residents in Portugal is progressive, meaning the more you earn, the more you pay in taxes. However, a special program for qualifying expats dubbed the Non-Habitual Residency (NHR) offers tax relief for up to 10 years. Let’s talk about it below.

NHR Regime in Portugal

The Non-Habitual Resident (NHR) regime in Portugal is a tax incentive program designed to attract foreign residents by offering favorable tax treatment. The tax incentives provided by this program are offered up to a specified period of 10 years.

While this regime doesn’t exempt expats from taxes, it surely is a great avenue for saving a lot of money. To benefit from the NHR regime, individuals must become tax residents in Portugal.

Expats need to stay in the country for more than 183 days in a year or have a residence specifying intentions to stay. Income earned within Portugal is generally subject to the regular Portuguese tax rates.

However, as defined by the NHR rules, qualifying foreign income may benefit from exemptions or reduced rates. Pensions and foreign employment income are often central to the NHR regime. These types of income may be eligible for a reduced tax of 10% instead of the standard 20%.

How to qualify for the NHR Regime in Portugal

Initially, in order to profit from the benefits resulting from the NHR regime, expats had to:

  • Have not had a tax residence in Portugal for the last five years
  • Must have stayed in Portugal for more than 183 days. If you stayed less than 183 days in Portugal, you must have an address here (such as a lease or deed of a property). This is the condition for becoming a tax resident in Portugal.

Apart from these conditions, you must also be a qualified professional as specified in Ordinance No. 230/2019, updated in 2020. However, it is sad to mention that there has been a recent shakeup in the NHR program coming in 2024.

After the resignation of Prime Minister António Costa on November 7th, the regime will likely survive until December 2024. Retirees and expats can apply for this program only under special conditions during this period.

To be eligible, you must provide evidence that you commenced your relocation plans in 2023. Check these:

  • The property lease contract proves your ownership until October 10th, 2023.
  • Reservation contract or promissory purchase contract with rights over the property until October 10th, 2023.
  • Enrollment in an educational institution until October 10th, 2023.
  • Residence permit valid till December 31st, 20223.
  • The residence visa procedure is initiated by December 31st, 2023.
  • Promise of work contract or employment initiated by December 31st, 2023. Work duties must be performed within the country’s territory.
  • Keeping a residency permit or visa valid through December 31st, 2023.
  • Filing of an immigration case by December 31st, 2023.

So, will this program exist after 2024? Yes, but under special rules, we recommend staying updated with the information and consulting tax experts at Viv Europe to guide you.

Do you need help with investments and taxation in Portugal?

There you have it, our 5 best investment options for retirees in Portugal. While the list is by no means exhaustive, we hope that the listed options will help point you in the right direction with investments.

Any financial decision must be carefully considered. Don’t rush; take your time doing research and consult with professionals before settling on a particular investment plan.

If you need further help relocating and finding the right investment for you, be sure to reach out, and let’s make it happen for you. Also, join our Facebook Group – All About Portugal For Expats. Our platform helps with queries, inspiration, and to make connections with other expats from all around the world. See you!



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