It is cheaper to live in Chile than in the USA or Europe. Even though Chile’s per capita income as a percentage of GDP is higher than any other country in South America, it is still only about a third of North American or Western European standards. That means that millions of Chileans live for much less than Americans and Europeans. They may not have a car (they use privatized public transportation), but they are well-fed and have sufficient clothing and shelter for the most part. Plus technology is common across the board for cellular phones, televisions, appliances, computers, etc. There is also a growing middle class that affords many of the features of life that Americans and Europeans are accustomed to having.

If you want the sort of lifestyle that most Chileans experience, and do not mind living in a Second World city or town, you and your spouse can live comfortably for about US$1,000 to US$1,500 per month, even if you have to pay rent. You will not be living high-on-the-hog, and may not have a maid (other than a day or two a week), but you will be able to make ends meet reasonably well. I know some Americans in Arica who live for under US$600 per month. Talca is likewise inexpensive.
If you want to live at a level that is equivalent to suburban American living, replete with car and a nice home or apartment in Santiago or Viña del Mar, you will likely need to have a little more than US$3,100 per month. In terms of assets, assuming one can consistently earn 7% on investments, the target used by upper-middle class Chileans (social category C1) is 300,000,000 pesos or US$550,000. If one owns his house or apartment free and clear, the amount of assets needed will be less. Likewise, if one is receiving a pension or Social Security, the amount of assets will be proportionately less. For instance, if a couple receives a total of US$1,600 monthly from such pensions, they would only need US$260,000 in investible assets. If they also own their “typical” dwelling free and clear, the amount of assets needed might only be US$100,000. A lot will depend on how much you plan to travel (travel within Chile purchased in advance in not expensive), whether you will eat out a lot instead of using your maid (and if you will be eating at pricey establishments), what recreational activities you plan to do, and whether you will be buying a lot of gifts for grandkids.
When I did financial planning in the USA, I usually recommended that my clients shoot for 3 to 4 times these assets as a minimum for retirement, perhaps US2,000,000. Chile is far more affordable. So do not make the mistake of thinking you need more than you do or have in order to retire in Chile. Of course, having more is always better. And the more one has the better he will be able to live in Chile. But this entry provides some guidance for at least minimum requirements you should strive for.