What Salary Is Considered Good in Portugal?

A “good salary” in Portugal is a subjective measure, deeply influenced by individual financial goals, lifestyle choices, and personal expectations. What one person considers sufficient for a comfortable life might be inadequate for another, especially when considering factors such as family size, spending habits, and desired leisure activities. Understanding this concept requires exploring the financial aspects that define purchasing power and quality of life in Portugal.

Average Income Levels

Portugal’s income landscape includes a national minimum wage, which as of January 1, 2025, is set at €870 per month, paid over 14 installments annually. This translates to an effective monthly minimum wage of approximately €1,015 when spread across 12 months. This minimum wage aims to cover basic necessities, including food, housing, utilities, and transportation.

Beyond the minimum, average and median salaries offer a broader picture of earnings. The average gross monthly salary in Portugal for 2025 is approximately €1,495. The median salary is around €1,240 to €1,320 per month. For context, average salaries for specific professions include:
Tech workers: around €3,690
Engineers: approximately €2,400
Sales representatives: about €1,750 monthly
Service industry workers (e.g., waiters, couriers): closer to €600 per month

Cost of Living Components

Understanding how far a salary stretches in Portugal requires examining typical living expenses. Housing represents a significant portion of monthly costs, often amounting to around a third of all expenses. In major cities like Lisbon and Porto, a one-bedroom apartment in the city center can range from €800 to €1,200 per month, while outside the city center, rents might be €500 to €800. The average rent for a two-bedroom apartment across Portugal in 2025 is approximately €1,220 per month.

Utilities for an average 85 square meter apartment cost around €130 per month, covering electricity, water, and heating. Internet services range from €30 to €40 per month. Groceries for a single person can cost between €150 and €350 per month, with an average of €270 for households in 2025.

Public transportation is relatively affordable, with a monthly pass in cities like Lisbon or Porto costing around €40 to €50. Basic healthcare costs are low, as Portugal has a public healthcare system (Serviço Nacional de Saúde – SNS) funded by taxes, making most services low-cost or free for residents. While public healthcare is accessible, private health insurance is an option, with basic plans costing around €15-€20 per month, and more comprehensive plans ranging from €50 to €150 monthly.

Geographic Salary and Expense Differences

Salaries and living costs in Portugal exhibit notable regional variations. Major urban centers such as Lisbon and Porto feature higher average salaries compared to smaller cities or rural areas. For instance, the average salary in Lisbon is significantly higher than in other parts of Portugal, although the most common salary in Lisbon is closer to €1,416 per month. However, these higher incomes in large cities are offset by a higher cost of living.

Housing costs, in particular, show substantial differences across regions. While major cities have higher rents, a similar property in a rural town could cost between €300 and €500. Smaller towns like Braga and Coimbra are more affordable. Daily expenses, including transport and groceries, are also higher in urban areas, although rural areas might incur additional costs for personal transportation due to limited public transport options.

Key Factors Affecting Earnings

An individual’s earning potential in Portugal is influenced by several interconnected factors. The industry sector plays a significant role; for example, professionals in IT and technology command higher salaries, with software developers earning around €2,900 and data scientists about €3,200 monthly in 2025. In contrast, sectors like hospitality and tourism, while large employers, offer lower wages.

The level of education and specialized qualifications also impacts earning capacity, with university graduates, particularly those with STEM degrees, securing higher starting salaries. Professional experience is another determinant, as longer tenure across various sectors correlates with higher remuneration. Language skills, especially proficiency in English or other languages in demand, can enhance earning potential, particularly in international companies or tourism-related roles. Specialized skills, such as those in cybersecurity or cloud architecture, are increasingly valued and can lead to elevated salary expectations.

Understanding Take-Home Pay

The gross salary is the total amount an employee earns before any deductions, while the net salary is the actual amount received after these deductions. In Portugal, gross salaries are subject to two primary deductions: income tax (IRS) and social security contributions. These deductions significantly reduce the take-home pay, impacting the actual amount available for living expenses and savings.

Income tax in Portugal is progressive, meaning higher earners pay a larger percentage of their income in taxes. For 2025, tax rates range from 14.5% for the lowest income bracket to 48% for the highest. Social security contributions are mandatory, with employees contributing 11% of their gross wages. Employers also make a separate contribution of 23.75% of gross wages. These contributions fund various social programs, including healthcare, pensions, and unemployment benefits.