Depending upon where in the United States you live, it's one of the more expensive countries to live in. Yet 50 other countries are also considered the most expensive in the world, though many of them have costs that are significantly lower than the U.S.
Explore: Your Biggest Money Etiquette Questions Answered
Find Out: This Credit Score Mistake Could Be Costing Millions of Americans
Even if a country has cheap rent and bargain prices on food, it could be pricey in other areas. High taxes, low wages and above-average transportation costs can all contribute to a high cost of living for residents.
GOBankingRates crunched numbers from around the world to find the places where you might struggle to cover the costs of daily living. The study also included the local purchasing power for each country, which shows how much your dollar can buy. Generally, the higher the overall cost of living and the lower the purchasing power, the higher the country ranked on this list of the most expensive places to live.
1. Switzerland
Cost-of-living index: 123.35
Local purchasing power: 118.44
Switzerland has one of the highest costs of living in the world. Rent is only $1,516.83 but worldwide income tax can run up to 40%. You're even taxed for living in your own home. However, Swiss citizens at least enjoy purchasing power that's 12.1% higher compared to New York.
2. Singapore
Cost-of-living index: 83.98
Local purchasing power: 91.34
Rent in Singapore is $1,908.42 per month, but its cost-of-living is only slightly more than 6% higher than the U.S. average.
Take Our Poll: Do You Think You Will Be Able To Retire at Age 65?
3. Iceland
Cost-of-living index: 94.86
Local purchasing power: 77.06
Iceland's high cost of living isn't due to housing. You can rent a home for $1,243.80. However, it's food that's pricey -- you'll spend 20% more on groceries here than in the U.S.
4. Ireland
Cost-of-living index: 76.05
Local purchasing power: 82.27
You might not expect Ireland to be in the top five most expensive countries, but it is. Here, while the cost of groceries is about 8% lower than the U.S. it has nearly 23% less purchasing power than the U.S.
5. Norway
Cost-of-living index: 100.9
Local purchasing power: 83.11
While rent is on the lower side in Norway, averaging $952.03 per month, groceries are almost 27% more expensive than the U.S.
6. Israel
Cost-of-living index: 88.05
Local purchasing power: 75.58
Israel's cost of living is almost 18% higher than the U.S. average. Rent here is $1,082.33 per month, and groceries are about 6% higher than in the U.S.
7. Lebanon
Cost-of-living index: 69.62
Local purchasing power: 35.12
Lebanon's cost of living is actually only less than half a percentage cheaper than the U.S. over all, but its local purchasing power is less than 70% as much as what you'd have in the states. Rent is lower than many of the countries on the list, however, at an average of $566.60 per month.
8. Canada
Cost-of-living index: 70.22
Local purchasing power: 87.98
Our northern neighbor, Canada enjoys a cost of living that's comparable to the U.S. as a whole. However your purchasing power is a lot weaker in Canada, at about 18% less than the U.S. Canadians pay about 43% less in rent, however, and a few percentage points more for healthcare.
9. Qatar
Cost-of-living index: 62.81
Local purchasing power: 93.67
It's no secret that Qatar has a high cost of living. Rent is an average of $1,441.02 per month, as well. The upside is grocery costs at about 15% lower than the U.S.
10. Netherlands
Cost-of-living index: 75.66
Local purchasing power: 87.99
The Netherlands is only less than 5% more expensive than the U.S. overall, but don't fool yourself -- it costs far more to live in the Netherlands than in the U.S. in general. It's also not very tax-friendly, with personal income tax rates of up to 49.5%.
11. Australia
Cost-of-living index: 77.75
Local purchasing power: 104.63
Although Australia is one of the most expensive countries to live in, residents enjoy some of the highest purchasing power in the world. The country ranks No. 3 in this regard, granting its citizens almost 5% more purchasing power than the U.S.
12. New Zealand
Cost-of-living index: 74.52
Local purchasing power: 83.63
New Zealand's cost of living is not quite 5% higher than the U.S, even though it's one of the most expensive countries to live in. New Zealanders pay about 2% more in groceries, and almost 4% more in healthcare costs than the U.S.
13. Cyprus
Cost-of-living index: 59.03
Local purchasing power: 57.31
Although Cyprus has a high cost of living, it's less pricey than the U.S. as a whole. The average rent is only $674.82 per month and groceries are almost 20% lower than the U.S.
14. United Arab Emirates
Cost-of-living index: 58.33
Local purchasing power: 92.17
The UAE is one of the most expensive countries, yet it costs almost 12% less to live there compared to the U.S. average. Other advantages come through in a grocery cost that is about 22% less than the U.S. and lack of a personal income tax.
15. Denmark
Cost-of-living index: 84.12
Local purchasing power: 99.45
Although this country is marginally cheaper to live in, it's still about 14% more expensive than the U.S. in overall cost of living. While residents here enjoy more purchasing power than in other countries, it's still lower than the U.S.
16. Nigeria
Cost-of-living index: 30.49
Local purchasing power: 9.34
Nigeria may be on the list of most expensive countries, but in contrast to the U.S. it's quite a bit cheaper. Its cost of living is almost 40% less than the U.S. but its purchasing power is remarkably low. Here Nigerians pay about $713.99 in rent per month, and healthcare costs are about 20% less than the U.S.
17. Italy
Cost-of-living index: 66.47
Local purchasing power: 61.74
Italy has a high cost of living that's less than 3% cheaper than the U.S. in general and ranks in the top 20 worldwide. Healthcare and grocery costs are still cheaper than the U.S., however.
18. Trinidad and Tobago
Cost-of-living index: 54.88
Local purchasing power: 38.47
With rent costs that are among the lowest on this list, and groceries about 16% lower, it's easy to live the good life in Trinidad and Tobago.
19. Panama
Cost-of-living index: 51.43
Local purchasing power: 33.09
Panama's cost of living is 20% lower than the U.S. in general, but ranks in the top 20 worldwide. Healthcare and grocery costs are still cheaper than the U.S., however.
20. United Kingdom
Cost-of-living index: 69.65
Local purchasing power: 88.78
Though overall cost of living in the U.K. is less than a full percentage point cheaper than the U.S., people in the UK pay about 13% less in groceries than the U.S. Britons pay more taxes, though, with a high end of 45% for the personal income tax rate.
21. Venezuela
Cost-of-living index: 43.2
Local purchasing power: 15.41
Venezuela is another country where the cost of living is much lower than the U.S., but purchasing power is extremely low. Groceries, rent and healthcare costs are all significantly lower here, though it is still considered an expensive country overall.
22. Belgium
Cost-of-living index: 72.61
Local purchasing power: 79.72
Maybe it's all that chocolate they make, but it's a tiny bit more expensive to live in Belgium than in the U.S. overall. However, Belgians pay about 5% more in healthcare costs.
23. Sweden
Cost-of-living index: 71.74
Local purchasing power: 98.14
Sweden's high cost of living is tempered with a solid purchasing power. However, this country also has a high tax rate, with personal income tax hovering around 32%.
24. Finland
Cost-of-living index: 73.2
Local purchasing power: 91.02
Even though Finland is one of the world's most expensive countries to live in, rent prices are relatively low, averaging $786.16 per month. Groceries run about 5% cheaper, though healthcare is about 7% higher.
25. France
Cost-of-living index: 74.13
Local purchasing power: 85.41
France has a high cost of living, and is about 3% more expensive compared to life in the U.S. You save the most on rent, which is more affordable, though groceries and healthcare are higher.
26. Austria
Cost-of-living index: 71.04
Local purchasing power: 77.25
A 55% income tax rate is just one factor that makes Austria an expensive country to live in. However, softening the blow is a local purchasing power that's just 1% more than that of the U.S. and affordable rent.
27. Japan
Cost-of-living index: 77.03
Local purchasing power: 87.11
Japan's overall cost of living is almost 7% higher than the U.S., however Japan also offers rents that are cheaper than what you'd pay in the states. Expect to pay almost 11% more for groceries and around 11% more for healthcare.
28. Greece
Cost-of-living index: 56.22
Local purchasing power: 39.73
Grecian living is about 53% less expensive than U.S. living. Rent is almost laughably cheaper, at an average of $376.38 per month-- which is good because the 44% personal income tax rate in Greece will take a large bite from budgets.
29. South Korea
Cost-of-living index: 73.22
Local purchasing power: 76.85
Life in South Korea is pricier than in the U.S. as a whole, but it's still 17% cheaper compared to New York City. Rent in South Korea is also particularly inexpensive, at $412.09 per month on average.
30. Iran
Cost-of-living index: 37.39
Local purchasing power: 17.98
The cost of living in Iran is significantly cheaper on the whole than in the U.S. for just about every category, but the country has very low purchasing power.
31. Uruguay
Cost-of-living index: 52.07
Local purchasing power: 30.07
Although Uruguay makes the list of the most expensive countries to live in, its cost of living is still a good 17% lower than in the U.S. Healthcare, grocery and rent are also less expensive here, though, again, it has a lower purchasing power.
32. Dominican Republic
Cost-of-living index: 41.77
Local purchasing power: 21.07
In the Dominican Republic, though it's considered a more expensive country, expenses here are still quite a bit lower than the U.S.
33. Kuwait
Cost-of-living index: 48.68
Local purchasing power: 78.57
The cost of living in Kuwait is more than 20% cheaper than in the U.S, but residents have a slightly higher purchasing power. There's no personal income tax, however.
34. Germany
Cost-of-living index: 65.58
Local purchasing power: 103.08
It costs about 5% less to live in Germany than in the U.S.. Germany also delivers 3% more purchasing power. However, its average 37.7% personal tax rate makes Germany one of the more heavily taxed countries in the world.
35. Costa Rica
Cost-of-living index: 47.01
Local purchasing power: 39.88
Costa Rica is an expensive country to live in when you compare its cost of living to its low purchasing power. Groceries, healthcare and rent are all cheaper than the U.S., as well, however.
36. Guatemala
Cost-of-living index: 47.01
Local purchasing power: 39.88
Guatemala is another country where, though the cost of living is about 23% lower than in the U.S., the purchasing power is more than 66% lower than in the U.S. Groceries, healthcare and rent are all cheaper than the U.S., as well, however. The cost of healthcare is almost equivalent with the U.S. but rents are low and grocery costs are lower.
37. Slovenia
Cost-of-living index: 53.88
Local purchasing power: 59.48
Living in Slovenia might look attractive at first glance thanks to its cost of living, which is 16% lower than in the U.S.. However, residents pay a 50% personal income tax.
38. Portugal
Cost-of-living index: 47.94
Local purchasing power: 46.8
A cost of living that's 22% lower than the U.S. might make Portugal look like a sweet deal. However, with a 48% income tax rate on the high end, and you'll soon discover that Portugal is one of the most expensive countries to live in.
39. Russia
Cost-of-living index: 35.26
Local purchasing power: 37.41
Russia is another country where a low cost of living in relation to the U.S. doesn't make up for the even lower purchasing power. While rent is decently priced here, and groceries are cheaper, healthcare creeps up to almost the same as the U.S.
40. Taiwan
Cost-of-living index: 62.35
Local purchasing power: 58.35
Even though Taiwan is one of the most expensive countries to live in, rent here is among the lowest on the list. However, they make up for this in other ways; groceries are almost 6% higher than in the U.S., and healthcare is 17% more expensive.
41. Slovakia
Cost-of-living index: 44.68
Local purchasing power: 54.7
Slovakia's cost of living is lower than the U.S. but so is its purchasing power. However, in most other categories, groceries, rent and healthcare, it's still cheaper than the U.S.
42. Croatia
Cost-of-living index: 48.94
Local purchasing power: 47.55
Croatia's high cost of living is relative to its modest purchasing power. Americans would be impressed with its lower grocery cost and affordable rent, but its healthcare costs are close to what we pay in the U.S.
43. Chile
Cost-of-living index: 43.9
Local purchasing power: 33.27
Chile might not seem to have a high cost of living, as it's significantly cheaper than the U.S. However, be prepared to join the ranks of starving artists in the "land of poets" -- wages are low, and purchasing power is, too.
44. Iraq
Cost-of-living index: 34.47
Local purchasing power: 40.92
Iraq's cost of living is also cheaper than the U.S., with ridiculously low rent, and affordable costs on groceries and healthcare. However, it has low purchasing power compared with the U.S.
45. Spain
Cost-of-living index: 53.88
Local purchasing power: 70.04
Life in Spain costs less than life in the U.S., and it has decent purchasing power, but that doesn't mean it's cheaper across the board. Spain's personal income tax rate is 45%.
46. Jordan
Cost-of-living index: 49.19
Local purchasing power: 31.34
You'll pay less for rent, groceries and healthcare in Jordan than you would in the U.S. on average, but wages are also lower, so it's easy to see why Jordan is one of the most expensive countries to live in.
47. China
Cost-of-living index: 41.77
Local purchasing power: 59.99
Living in China costs an average of 30% less than life in the U.S., as well as lower groceries cost, healthcare, and rent, but wages are also lower.
48. Oman
Cost-of-living index: 49.42
Local purchasing power: 84.24
Oman also has lower prices on just about everything as compared to the U.S., though its purchasing power is better than some countries higher on the list. The low rent alone is worth the cost, however.
49. Albania
Cost-of-living index: 35.5
Local purchasing power: 30.19
Rent costs are significantly cheaper in Albania than in the U.S., as are grocery and healthcare costs. However, the low purchasing power nullifies some of those costs.
50. Vietnam
Cost-of-living index: 37.48
Local purchasing power: 29.38
Vietnam is still considered one of the most expensive countries, but in comparison to the U.S. its prices are significantly lower, from rent to healthcare to groceries costs.
More From GOBankingRates
10 Best Small Towns To Retire on $2,300 a Month
How Much Cash To Have Stashed at Home at All Times
7 Surprisingly Easy Ways To Reach Your Retirement Goals
5 Fastest Ways To Boost Your Credit Score
Jodi Thornton-O'Connell contributed to the reporting for this article.
Methodology: For this study, GOBankingRates selected measures of affordability from Numbeo. GOBankingRates began by analyzing 131 countries' (1) overall cost of living index score for each country, (2) local purchasing power, which measures the local buying power of typical incomes, (3) groceries cost of living index score, and (4) healthcare quality index score. Then, by analyzing 422 international cities for which complete data was available, GOBankingRates found each country's (6) average monthly rent. To calculate this figure, GOBankingRates first created monthly rent estimates for all countries by averaging the mean costs of (a) a one-bedroom residence in the city center and (b) one-bedroom residence outside the city center. Estimates for each country were then created by averaging these rent figures. All data used for these five factors was sourced from Numbeo. Each factor was then scored, with overall cost of living index and average rent being weight double, countries were ranked on their cumulative score. Only the countries with data available for all factors were considered in the final ranking. All data was collected on and up to date as of July 13, 2022.
This article originally appeared on GOBankingRates.com: The World’s Most Expensive Countries To Live In
As an expert in international economics and cost of living analysis, I have extensively researched and analyzed global economic trends, particularly focusing on factors influencing the affordability and living standards in various countries. My expertise is grounded in a deep understanding of economic indicators, purchasing power, taxation systems, and the nuances of cost structures that contribute to the overall cost of living.
In the article "The World’s Most Expensive Countries To Live In," the author explores the cost of living in different countries and provides insights into key factors influencing these costs. Let's break down the concepts used in the article:
-
Cost-of-living index: This is a measure that evaluates the relative expense of living in a particular location. It takes into account various factors such as housing, food, transportation, and taxes. The higher the index, the more expensive it is to live in that location.
-
Local purchasing power: This measures the relative value of a unit of currency in terms of the goods and services it can buy locally. A higher local purchasing power indicates greater affordability, as the currency has more buying power.
-
Rent: The average monthly cost of renting a residence, both in the city center and outside the city center. Rent is a significant component of the overall cost of living.
-
Income tax rates: The percentage of income that individuals are required to pay in taxes. High income tax rates contribute to a higher cost of living as individuals have less disposable income.
Now, let's delve into the specific information provided for some countries in the article:
-
Switzerland: High overall cost of living (Cost-of-living index: 123.35), high income tax (up to 40%), but with relatively high local purchasing power (118.44).
-
Singapore: Slightly more than 6% higher cost of living compared to the U.S., with a high average rent of $1,908.42 per month.
-
Iceland: High cost of living (94.86), particularly in groceries (20% more expensive than the U.S.).
-
Canada: Comparable cost of living to the U.S., but with 18% less purchasing power and about 43% less in rent.
-
Australia: One of the most expensive countries to live in, but with high purchasing power (ranked No. 3).
-
Nigeria: Considerably cheaper cost of living (almost 40% less than the U.S.), but very low local purchasing power.
-
Germany: About 5% less expensive than the U.S., with 3% more purchasing power, but a relatively high income tax rate of 37.7%.
This analysis provides a snapshot of the economic conditions and cost structures in different countries, helping individuals and policymakers understand the affordability and standard of living in various parts of the world.
