Latvia offers an affordable cost of living with a CPI of 49.7 (NYC = 100). Groceries (index 47.1) and restaurant prices (index 48.0) are also notably lower than in many major European cities.

The housing market is moderate, with a property price to income ratio of 8.19 years. The rent index is 10.34, indicating relatively affordable rental options.

The purchasing power index is 86.88 (NYC = 100), suggesting a moderate buying power for residents.

Latvia has a progressive personal income tax system with rates of 25.5% (up to €105,300) and 33% (above €105,300), plus a 3% surcharge for income over €200,000. The standard VAT rate is 21%, with reduced rates of 5% and 12%. Property tax ranges from 0.2% to 3% of cadastral value.

Latvia offers a dynamic and growing startup ecosystem, supported by government initiatives like startup visas and tax incentives. While the Global Startup Ecosystem Index 2025 ranks Latvia at #49 globally, the ease of starting a business is considered favorable.

Latvia operates a three-pillar pension system and provides public healthcare accessible to residents with a residence permit. Public healthcare is tax-funded and generally affordable, though some co-payments apply (capped at €570 annually).

Deposits are protected up to €100,000 (approx. USD 110,570) per depositor per bank under the EU Deposit Guarantee Scheme. The banking sector is well-capitalized, profitable, and subject to strong oversight by Latvijas Banka, with regulations often exceeding EU requirements.