Most international moves out of America are to Europe. The appeal is obvious – these places are vacation spots and connect us to the old world where many of our ancestors came from. However, the cost of living can be high in some parts of Europe and s Americans are not prepared for the financial strain of living there. The cost of living varies within Europe but generally you should be prepared for higher prices.
How is the cost of living calculated?
The cost of living is determined by calculating what an average person needs to pay for in daily life in an area. This includes a variety of often unavoidable expenses that vary location to location. Here is a list of factors that can determine cost of living in an area:
- Cost of food and drink
- Cost of local private schools
- Cost of household necessities
- Utility costs
- Medical costs
Keep in mind that government policies and programs can alter the cost of living. Higher taxes in an area can be made up for by free healthcare services, for example. The calculations are never as simple as adding up a bunch of numbers, there are always different factors and considerations.
There are a variety of cost of living calculators you can use online to compare cities, but keep in mind that two different calculators can yield different results and cost of living is a dynamic statistic that changes frequently and unexpectedly.
You also need to factor in the exchange rate when considering the cost of living. If your money is worth less than the currency in a foreign country, you will end up with less money when it is converted, effectively making everything there more expensive for you. The Euro is the current currency of the European Union which includes most European countries. The value of the Euro compared to the US dollar shifts over time but it generally is more valuable. As of right now (mid-October 2014) a Euro is worth 1.28 US dollars.
The highest and lowest COL in European countries
What European countries are the most expensive? Which ones are bargain destinations by comparison? Here are some quick statistics. Remember that COL changes so what is accurate now may not be accurate in a year or two.
Top 5 highest COL countries in Europe by how much $1 USD of goods will cost
5. Luxembourg $1.44
4. Sweden $1.50
3. Denmark $1.67
2. Norway $1.81
1. Switzerland $1.95
Bottom 5 Lowest European COL
5. Bulgaria $0.53
4. Albania $0.53
3. Ukraine $0.50
2. Macedonia $0.48
1. Belarus $0.41
The most popular European destinations for Americans are in the upper half of the list, but are not as extreme as Switzerland or Sweden.
- Italy: $1.23
- France: $1.27
- Ireland $.123
- Germany $1.17
- UK $1.10
- Spain $1.09
- Greece $1.01 (the closest to the US)
What does all of this mean? It means it is expensive to move to a popular international vacation spot or Northern Europe. If you are worried about the cost of living and still want to move to a nice place in Europe consider cities in Poland, Portugal, and the Czech Republic. All these countries currently have a lower cost of living than the US. Meanwhile, you can certainly still move to Paris, but you should know that it is going to cost you. Be sure to budget appropriately and don’t forget the costs of moving there in the first place.