We are able to get by on a retirement budget of about $33,000 per year including a paid off house. We could rent our house in the US and net $800-900 per month which might be enough to allow us to rent a decent furnished house or apartment in Mexico. Almost all of our costs would drop, but we would have to use part of our $5,300 vacation budget for visits back to the US. Food, transportation, and entertainment costs would drop. Electronics and appliances tend to cost the same or more down here, so we might see an increase in these expense categories. Overall, I imagine we could live a slightly more luxurious lifestyle on a little less money.
But should we move 2,000 miles away just to save a little money? That’s the tough part of the equation. I don’t think it’s necessarily better or worse in Mexico assuming you have adequate funds to live on. Just different in some aspects. There’s a vibe here that’s hard to explain. The parks seem to attract more people having fun. There’s always a festival or parade or protest going down. Running errands can be a cultural and language adventure.