Many say that America is no longer the land of opportunity. Times have changed. Years ago, the new world offered what old Europe didn’t. Land cost less. People could make more money. Feeding and raising a family was supposed to be easier. Much has changed since boatloads of starry-eyed immigrants followed the first settlers.
But one fact remains. There are still plenty of financial perks to living in the USA.
Houses Are Cheap
No, a mind-altering drug hasn’t made me crazy. I realize that homes in some U.S. cities accompany eye-watering price tags. But overall, American houses are cheap. The 2014 Demographia International Housing Survey compared home prices in nine major global markets. In cities with more than 1 million people, U.S. homes cost 3.5 times more than what the typical household earns. Compare that to the 4.5 times cost of Canadian homes, the 4.7 times cost of United Kingdom homes or the 8 times multiple of houses in New Zealand.
Include smaller cities, towns and rural areas in the benchmark and the U.S. was the second cheapest country profiled. Only homes in long-suffering Ireland cost less. But American houses aren't just cheaper. They're also bigger. When measuring home costs per square foot, U.S. homes are even more affordable. Canadians pay 50 percent more; Australians pay 80 percent more. New Zealanders and the Irish pay 150 percent more.
Fuel Prices Are Low
American gasoline is cheap. According to Globalpetrolprices.com it’s cheaper than in any other first world country. It even costs less to fill a tank in America than it does in Mexico. Gas prices are 44 percent more in Canada, 46 percent more in Australia and 100 percent more in the United Kingdom.
You wouldn’t want a gas-guzzler in Holland, Norway or Italy. On average, it costs 182 percent more to fill up their tanks.
Home heating costs are also low in the United States. Statista collected electricity costs in 18 of the world’s leading economies. Of the countries studied, only those living in Australia, Canada, South Africa, Finland and Sweden pay less for electricity—and just barely.
Residents in other countries pay a lot more. The Spanish pay 36 percent more than Americans. The British pay 54 percent more. Germans pay 92 percent more, and Italians pay 101 percent more.
According to the American Enterprise Institute, U.S. natural gas prices are even cheaper by comparison. Natural gas costs 105 percent more in the United Kingdom; 113 percent more in Spain; 268 percent more in China; and 302 percent more in Brazil.
Taxes Are Low
Taxes are a pain in the butt no matter where you live. Yet they're less of a pain in America than they are in most countries. The BBC reported a study done by the Organisation for Economic Cooperation and Development (OECD). They compared taxes in 15 countries, based on average salaries of single people with no children. The study included income and social insurance taxes. Only 5 of the countries surveyed were reported to be lower than the United States. They included Korea, the Slovak Republic, Mexico, Chile and the Czech Republic.
Social Security Payments Are High
U.S. Social Security payouts are extremely generous. The Complementary and Private Pensions Database has compared maximum annual pension payouts per country. In 2012 America ranked second, behind only Germany. American Social Security payouts are 140 percent higher than they are in Canada and 152 percent higher than they are in the United Kingdom.
2012 Maximum Annual State Pension Payouts Per Country
|Country||Maximum Annual State Pension (USD)|
|Source: Complementary and Priv ate Pensions Database, “Private Pensions-OECD”
Currencies converted Jul 7, 2013
America Has The World’s Best Mutual Funds
Morningstar compares mutual funds available in 24 countries. The U.S. ranks #1. It’s given top honors for the lowest fees and the best regulatory disclosure. Morningstar says America’s media also “does a fine job of emphasizing a long-term perspective and low costs.”
Low costs affect investors’ wealth—a lot. U.S. equity funds cost less than 1 percent per year. If stock markets averaged 8 percent, investors paying 1 percent in annual fees would give up just 12.5 percent to the financial services industry. Canadians, in contrast, get wacked with a paddle. Their equity funds cost about 2.5 percent. When markets average 8 percent, Canadians will put 31.2 percent of their returns into the cost monster’s mouth.
Every country has its problems and its perks. But when it comes to acquiring and keeping wealth, it still pays to live in the U.S.A.
Andrew Hallam is a Digital Nomad currently living in Chapala, Mexico. He’s the author of the bestseller, Millionaire Teacher and The Global Expatriate's Guide to Investing: From Millionaire Teacher to Millionaire Expat.