Dateline: Belgrade, Serbia
I decided to move overseas for a lot of reasons: to save on taxes, to find new markets, to make better investments, to increase my freedom, the list goes on. A pleasant surprise I found along the way was that my list of reasons to stay overseas only continued to grow once I left the United States.
Since then, my mindset has evolved from a focus on “flight” to one centered on abundance and feeling truly at home. Part of the reason this mindset shift was possible in the first place was because leaving my home country freed me from so many of the constraints that kept me from believing that abundance was even attainable.
More and more people are choosing to embrace the expat life in pursuit of more fulfillment abroad, whether in terms of career satisfaction, financial security, greater liberty, or a simple change in perspective. Whatever they set out to achieve, those who leave behind their old borders encounter greater opportunities to understand what it means to live abundantly.
Abundance is a relative term. It is difficult to fully explain to someone who has never ventured beyond their original borders, but there is more than one way to live a happy, fulfilling life. It is much easier to understand this when you can see the many ways to live abundantly with your own eyes.
To most people in the West, abundance means owning a house, a couple cars, and having a good job that pays all the bills. While I had all three when I lived in the US, after living abroad for so many years, my personal equation for abundance no longer includes owning even a single car – cars are neither a necessity for the life I have created nor a positive addition to it.
Living without a car is not the talk of a minimalist. I own enough homes around the globe to be disqualified from that title. And I certainly do not preach the digital nomad mantra of living on $1,000 a month while backpacking my way to happiness.
But abundance does not have to mean having a high cost of living. There is a difference between minimalism or “living on a shoestring” and simply refusing to pay too much for the basic necessities of life.
Going where you’re treated best can mean choosing where you live based on the cost of living. Often, the most expensive places to live are the ones where abundance is so narrowly defined that the only way to achieve that particular form of abundance is to pay for it in spades.
Nomad Capitalists who choose to live according to a different definition of abundance have the advantage of knowing that they can go where they are treated best to achieve their personal form of abundance – not one dictated by a specific place or other people. They are not tied down to one competing market for the abundant life. Instead, they can choose to go where abundance is an accessible, natural part of life.
This is one reason my Nomad Capitalist Team and I created the Nomad Quality of Life Index. Each individual’s definition of abundance is so personal that finding the abundant life depends on much more than finding the country with the cheapest wine.
The Index compiles all the potential factors you would want to take into account – from safety to accessibility to entertainment to cost of living – and lines them up so you can see them all together.
You can do so by taking a look at the full index here, but today I want to get a closer look just at the cost of living. More specifically, let’s examine the cost of living in the most expensive cities in the Quality of Life Index. Not only will this give us an idea of the places where it is best not to live but it will also give us a chance to examine what these places have in common that makes the basic costs of living so unnecessarily expensive.
We compiled the index by drawing on our network of expat sources, as well as several “cost of living” indices like those produced by Mercer, Numbeo, and Expatistan. We took into consideration housing, transport, food, clothing and entertainment costs for each city. This affords a more rounded assessment of both the cost of living and the standard of life available in each city for the best expat living conditions.
The 10 Most Expensive Cities for Expat Living
1. Zurich, Switzerland – 149.15
Zurich is not only the most expensive city in Europe but also the world. It is followed closely by its other Swiss counterpart, Geneva. Almost everything from entertainment to transport and rent is expensive in Zurich, a stance that is further accentuated by the strong Swiss Franc.
However, Zurich does compensate by offering a superb standard of living to all those who dare to live there. Sadly, Switzerland has become far more difficult to immigrate to; it is one of those countries that, like others on this list, has enough millionaires and is not exactly desperate for more.
In fact, Zurich has one of the highest concentrations of millionaires per capita. That is hardly surprising considering that the average Swiss family has a net worth nearing $600,000, the highest average in the world. That means that everything from maid service to taxis costs a fortune.
2. Geneva, Switzerland – 142.12
Geneva is in close competition with Zurich as the most expensive city in the world. In fact, while it takes second place on our list, it captured the top spot on Expatistan’s cost of living index. Despite lower taxes and higher salaries, many residents in Geneva see their money disappear into mandatory insurance payments and over-priced goods and services.
Utilities, food, healthcare, clothing, and entertainment all cost more in Geneva than anywhere in Europe. The city has the world’s most expensive cinema and even managed to snatch the top spot for the world’s most expensive boneless skinless chicken breast! Costs for transportation and electronics are similar to the rest of Europe and, though gas is cheaper than in countries like France and Italy, owning a car is very costly.
Rent in Geneva is higher than even in New York or Paris. The average cost for a two-bedroom apartment is $3,500 USD a month and a home costs twice as much. A family of four would need to make at least $7,000 USD a month to get by in Geneva – let alone live abundantly.
3. Reykjavik, Iceland – 130.73
While Iceland may seem unassuming, it will quickly take your cash and run with it if you ever decide to settle down for a time in the country’s capital city.
Reykjavik beats out cities like New York and Tokyo for cost of living by a long shot. Consumer prices are 17.76% higher in Reykjavik than in New York, grocery prices are 14.32% higher, and restaurant prices are 20.47% higher.
In fact, Reykjavik is one of the most expensive cities for dining in the world. An “inexpensive” meal will cost about $20, while a mid-range restaurant will come with a check well above $100. The city also has the second most expensive gas in the world and a pricey public transportation system – a monthly transport ticket will cost you $110.
While the cost of living in Reykjavik is 21.6% higher than in New York, the rent is considerably lower. A 900sqft apartment will cost you roughly $2000-$2500 – not cheap, but better than what you’ll pay in many of the other countries on this list. Still, a family of four will need an additional $5000 in monthly income (on top of rent) to make it by in this island nation.
4. Oslo, Norway – 114.78
Very few things in Norway’s capital, Oslo, could be considered cheap, not even in comparison to prices in the rest of Europe. It’s bad news when your claim to glory is taking the number one spot for the most expensive Coca-Cola in the world.
On top of the already-high prices on imported food products, there is also a 14% VAT consumers have to deal with. These high prices motivate many Norwegians to cross the border into Sweden on a regular basis to stock up on the lower-priced food staples available in shopping centers set up on the border just to accommodate cash-strapped Norwegians.
While salaries are substantially higher in Oslo, between taxes and the high cost of living, most residents are forced to stick to a strict budget. A single person can expect to spend $1,200 a month plus rent (which can cost an average of $1850 to $2500 a month depending on where you choose to live).
Oh, and if you want a license, be prepared to fork over $5,500 just for the privilege of driving.
5. Bergen, Norway – 112.60
Bergen is one of Norway’s biggest tourist destinations, boasting stunning views of the Nordic country’s fjords along its west coast. Anyone looking to become more than just a tourist in Bergen may be convinced otherwise by the city’s brutally expensive food and drinks. Even supermarkets charge prices that are almost double anything else you will find in Europe.
The silver lining is that 3-star and 4-star hotels offer remarkably good value and most attractions are either free or almost free. If you’re looking for a more permanent residence, a 900sqft apartment will cost you anywhere from $1400 to $2100 a month.
6. Honolulu, Hawaii, USA – 103.30
Beating out New York City as the most expensive city in the United States, Honolulu, Hawaii takes sixth place among the world’s most expensive cities.
Like Norway, Hawaii’s food prices are sky-high thanks to the increased costs of importation. Because of this, Honolulu has the world’s most expensive toilet paper: roughly $6 for a pack of four rolls!
But high food prices barely scratch the surface of Honolulu’s real cost of living problems. While the city’s overall cost of living is 90% higher than the national average, housing prices are a full 209% above average. Demand for vacation properties in Hawaii means the median price of a home on Oahu is $730,000. And if you can manage to rent something long-term, you’ll be lucky to get something below $2100 a month.
Other commodities that will cost you an arm and a leg in Honolulu are gas and electricity. Electricity costs twice as much in Hawaii as it does in Alaska (the second most expensive state for electricity) and more than three times the national average. Gas prices in Honolulu are also the highest in the country. My suggestion? If you want to live on an island, don’t pick Hawaii.
7. New York, NY, USA – 100
New York unquestionably lives up to its reputation as one of the most expensive cities in the world. Groceries can cost anywhere from 28 to 39% more than the US national average and eating out is equally expensive. A meal for two at a half-decent restaurant accompanied by some wine will cost you at least $75, if not more – 60% higher than the national average.
Like Honolulu, the most painful price point for New Yorkers is rent. The median monthly rent in Manhattan is a whopping $3,100 (and an average of $3,600), and Brooklyn isn’t much better at just over $2,600. These prices are an astounding 65% of New Yorkers’ median income.
There’s not much room for an abundant life when you are handing over two-thirds of your paycheck every month just to put a roof over your head.
On top of rent, a family of four can expect to spend an additional $4,300 on day-to-day expenses. No one said raising a family in New York was cheap. And, even if you’re single, you will still have to pay the city’s higher tax rates and additional taxes you won’t find in most other parts of the country.
8. Tokyo, Japan – 97.71
One of the world’s most populous cities, Tokyo is Japan’s “new capital,” reflective of the fast-paced high-tech vibe that the “New Japan” has embraced. A three-bedroom apartment can cost upwards of 9,000 USD while astronomical real estate prices put the likes of New York’s SoHo lofts to shame. Still, the average monthly rent sits just around $2,500.
The cost of entertainment is ludicrously high in Tokyo where it can cost as much as 46USD for two tickets at the movie theatre. Transportation isn’t any cheaper, neither is fast food, gym memberships, or clothes. Some grocery items such as milk will also substantially set you back.
Still, many expats and tourists continue to flock to the city, enchanted by the mysticism surrounding Japanese culture. Japanese food and traditions are unlike anything in the rest of the world.
9. Copenhagen, Denmark – 97.14
Even by European standards, Denmark is an expensive expat destination. The cost of living is high, especially when it comes to eating out, paying for gas and utilities, and spending on accommodation and transportation.
There is high demand for the limited amount of accommodation in Copenhagen. This means you will often be asked to make an initial deposit of up to three months’ worth of rent to lock down a place. One month of rent can cost an average of $1,700 in normal areas and over $2,300 in more expensive areas of the city.
Higher salaries balance out many of the higher costs, but a family of four can still expect to spend about $3,800 a month apart from rent and a single person should plan on spending just over $1000. One way to cut costs is to cycle or walk through the picturesque city.
10. Sydney, Australia – 94.24
Sydney is a beautiful city. From the Opera House to the Harbour Bridge to Bondi Beach and Darling Harbour, there are more than a few ways to enjoy the fascinating Australian city. All the sites do come with a cost, though.
Sydney is Australia’s most expensive city. As with most places in this top ten ranking, rent is the largest contributor to the high cost of living. Depending on where you rent, you can expect to pay $2,000 to $2,700 for a 900sqft apartment which makes it one of the most expensive cities for housing.
Sydney is the worst, but Australia as a whole is not cheap. While the cost of living is 13.72% lower than in New York, compared to the US as a whole, it is more expensive to live in Australia. This is especially true when it comes to entertainment, clothes, and transportation.
Trends and Commonalities
Many of the world’s most expensive cities share some common characteristics. One of the easiest to note is that they are all from the “developed” West. With the exception of Tokyo, every city is either located in Europe, the United States, or Australia. In fact, Tokyo and Tel Aviv, Israel are the only two countries in the top 20 not from one of these areas of the world.
The news is always full of stories of how life for the middle class in many of these countries is becoming increasingly more difficult. This quick look at the cost of living is an easy way to see why. The cost just to “get by” is too high for anyone living in these places to even consider living an abundant life.
Another look at the list will reveal that paying more to live in the world’s most expensive cities may not even get you closer to your end goals. If your goal is to live in a safe city, you may be surprised to learn that of the world’s most expensive cities only Tokyo made it onto the list of the world’s ten safest cities. Ironically, one of the least expensive cities on the list – Georgia – did make it into the top ten ranking for safety.
If you already live in one of the world’s most expensive cities – even places like Paris, London, or Montreal in the top 20 – then you understand that paying more doesn’t always get you more. That is why it is so important to sit down and decide exactly what you are looking for.
And if you can’t figure out what you want sitting around and thinking about it, it’s time you get out and go see the world for yourself so you know what it has to offer. Either way, you can use the Nomad Quality of Life Index to get a bigger picture of what the world has to offer and the places where you can find the right combination for your personal abundant life.
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