Would I Be Financially Better Off Living in the US or Europe?

When I was thinking about moving abroad, a few people told me my salary would likely be lower if I moved to London. And they were right. But honestly, I didn’t care—I just wanted to live abroad. For the first few years, it didn’t really matter. But longer-term? It’s a fair question: Would I be financially better off living in the US or Europe? That’s what we’ll dig into today.

We’ll start by looking at key factors that affect your financial situation—like cost of living, salary, taxes, and healthcare. Then we’ll compare five US cities and five European cities to see how income and expenses actually play out in each.

But long term? That’s a different story.

At some point, we all need to ask: Would I be financially better off living in Europe or the US?

In this post, we’ll take a closer look at that question. First, we’ll walk through eight key factors that impact your financial situation when living abroad. Then, we’ll do a side-by-side cost of living and salary comparison between five cities in the US and five in Europe to see where you might come out ahead.

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Key Financial Factors to Consider

Here are eight things to think about when comparing your financial life in the US vs. Europe:

1. Cost of Living
   Cities like London and Paris can be expensive, but many European cities—especially in Southern or Eastern Europe—are far more affordable than most major US cities.
2. Salary & Job Market
   Salaries can be lower in Europe, especially in smaller markets. However, opportunities in major hubs like London or Amsterdam may offer competitive pay. If you’re self-employed with US clients, your income might go further in Europe.
3. Taxes
   Taxes are often higher in Europe, but they also fund robust public services like healthcare and education.
4. Healthcare
   In the US, healthcare can be a major monthly expense—even with insurance. In Europe, many countries offer quality public healthcare with little to no out-of-pocket costs.
5. Education
   Planning for kids? Public education and even university are often much cheaper (or free) in Europe.
6. Currency Exchange Rates
   Earning in one currency and spending in another can affect your bottom line, depending on fluctuations.
7. Retirement & Social Security
   If you plan to retire abroad, you’ll need to consider how your US-based retirement plans and Social Security will transfer.
8. Visa & Immigration Costs
   Getting the right visa may come with costs. Some companies will sponsor you, but entrepreneurs and freelancers may have to cover it themselves.

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US vs. Europe: A Cost Comparison

To make things practical, I ran a simulation comparing five US cities and five European cities. I based it on a single marketing manager renting a one-bedroom apartment.

US Cities:

• Austin, TX
• New York, NY
• Nashville, TN
• Denver, CO
• Charlotte, NC

European Cities:

• Madrid, Spain
• London, UK
• Lisbon, Portugal
• Amsterdam, Netherlands
• Berlin, Germany

Here’s what I found:

	US (Avg)	Europe (Avg)
Take-home pay (monthly)	$5,920	$4,089
Cost of living (monthly)	$3,741	$2,592
Average savings	$2,179	$1,497

That’s a $682/month difference in favor of the US—or about $8,000/year. But that doesn’t tell the whole story.

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What That $682 Doesn’t Include

In the US, unexpected expenses like car repairs or a surprise medical bill can quickly eat into that cushion. European residents generally don’t deal with these same spikes thanks to public healthcare and better public transport options (no car needed in most cities).

For example:

• The average car payment in the US is $620/month. In Europe, many people use public transportation for under $100/month.
• Healthcare in Europe is often free or very low cost, whereas even insured Americans often pay hundreds out of pocket.

So while your monthly savings might technically be higher in the US, you might also face more unpredictable expenses.

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So… Where Would You Be Better Off?

It depends.

If your income is tied to a US employer or US clients, living in Europe could actually boost your financial wellbeing thanks to lower living costs in certain countries. But if you’re earning a local European salary, you might take home less—though you’ll likely spend less too.

At the end of the day, it’s not just about the numbers. Moving abroad is about quality of life. And sometimes, even if it means saving a little less each month, the experience is more than worth it.

I didn’t move to London because it was the cheapest option—I moved because it was what I wanted. And I’ve never regretted it.