8 American Money Habits Other Countries Don’t Understand

Americans may view things like their spending habits, debt, and retirement savings very differently than people in other countries do.

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Updated May 28, 2024
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Americans may have a different view when it comes to money compared with other countries. We have a tendency to pay less in taxes but also may be more likely to tip well or be better prepared for retirement. As people from other countries look at our spending habits, perhaps there are a few things that they may find unfamiliar.

Living to work

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In the U.S., the average American takes off 14 days per year. Compare that to Europe, which requires 20 days of vacation for employees. Americans are also less likely to take all of their vacation days, and more likely to feel like they can’t take time away from their jobs.

However, the coronavirus pandemic may have caused a shift in how Americans view sick leave. In fact, many companies increased the amount of sick time for their employees during the pandemic, allowed for flexibility to work from home, and became more relaxed about giving employees time off.


SASITHORN/Adobe hand of a woman with an american dollar bills

The United States has a pervasive tipping culture, especially when it comes to tipping waiters and other restaurant staff. This can both be a good thing or a bad thing depending on the type of restaurant and the likelihood of patrons tipping a customary 10% to 20%. A high-end restaurant could mean more tips for employees on expensive entrees and drinks compared to a lower tip for more affordable restaurants.

On the other hand, tipping in Europe can vary, but some countries may have service charges already included on restaurant bills or may accept a more modest tip than the typical American rate. Tipping also isn’t usually done at restaurants in Asian countries or Australia either, although they may be more likely to tip hotel workers than we do.

Pro tip: Remember that there are also some people you don’t tip at the holidays in the U.S., which could also vary from country to country.

Big cars

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The United States doesn’t have some of the physical limitations that other countries have such as narrow streets in old city centers that were built before cars were invented. Because of that, Americans tend to buy bigger cars such as trucks and SUVs compared to European drivers.

Another big factor is gas prices. While gas prices have skyrocketed because of inflation, a gallon of gas is still much cheaper in the U.S. than in other countries due to taxes, which makes it more affordable to drive a large car in the United States.

Related:  4 Strategies the 1% Use to Deal With Inflation.

Paying less in taxes

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It may be tough to remember as you write your check to the IRS this year that taxes in the United States are relatively low compared to other countries. Even people in states with the most income tax may be paying less than residents of some international spots.

Americans also tend to pay lower taxes on goods and services than other countries. On the other hand, there are countries that use their additional tax revenue for things such as universities or health care while Americans typically have to pay for items like that out of pocket.

Pro tip: As tax deadlines loom, keep an eye on these tax scams that could cost you money and cause you headaches

Health care costs

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One big cost for Americans is health insurance. The average annual cost for health insurance is $7,470 for individuals or $21,342 for families. Prescription drugs also can be much higher for Americans. In countries with a nationalized health care system, those costs may be lower. However, remember that Americans pay lower taxes so the burden of health care costs is spent on private insurance.

Retirement costs

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In places like Europe, countries may have government-funded pensions similar to the United States, which relies on the Social Security system. In Europe, the average benefit is about 17,000 euros a year, which is about $18,700. However, that annual payout can vary greatly from country to country. On our side of the pond, the average Social Security benefit is more than $19,000 a year.

However, Americans are more likely to supplement their Social Security with additional private retirement savings, such as a 401(k) or other investments. Europeans, on the other hand, may expect larger payments from the government and then find they aren’t receiving enough money to pay for everyday costs when they’re retired.

Student debt

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One major cost for Americans is student loans to cover college and post-graduate tuition. In fact, about 46 million Americans are carrying student loan debt. Students graduating with a bachelor’s degree have an average of $28,400 in federal and private loans. On the other hand, countries like Greece, Argentina, and Germany have publicly funded colleges and universities so students don’t have to take out loans to cover tuition.

Pro tip: Refinancing your student loans could save you a lot of money and might be something to look into if you’re struggling with this sort of debt.


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Americans buy more goods than other countries with consumption per capita growing 65% from 1990 to 2015. Compare that to a 35% increase in consumption per capita in Europe.

Americans have been picking up bigger homes and more televisions compared to the 1980s. Americans also tend to buy cheaper items that are more likely to wear out, such as fast fashion, compared to Europeans, who prefer spending more money on quality goods that will last longer.

Another example of this may be Americans buying bigger and in bulk. Costco, for example, is expanding its reach, but the number of stores in Europe is 35 compared to a whopping 572 Costcos in the U.S.

Bottom line

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While Americans may have options for bigger cars and fewer taxes when compared to their counterparts in other countries, we also might have to consider how to pay off debt from student loans or credit card debt. But perhaps these trends may change as we emerge from the coronavirus pandemic, which allowed consumers to save money or make purchases in different ways.

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Author Details

Jenny Cohen

Jenny Cohen is a freelance writer who has covered a bit of everything, from finance to sports to her favorite TV shows. Her work has been featured in The Wall Street Journal, USA Today, and FoxSports.com.