I'm Italian and I've lived in Germany, England and the US. Here in the US our income doubled, BUT everything costs more. A swim lesson for our kids costs like a month of swim lessons in London. Same for ballet. Summer camps here are on the tune of 400$ per week per child. I grocery shop at Aldi and we still spend more. We have to have 2 cars and we can't walk anywhere. We pay for part of our health insurance, dental insurance and vision. It is insane, and I don't think we will stay here long term... Social pressure is only a small tiny part of the issue
I'm Austrian and live in the US with my Austrian wife and our child. Same here, everything costs so much money. Car repairs are done sloppy and bad, you have to come back a few times to actually fix issues. The infrastructure is extremely poor. We have been here 15 years and will go back next year. Americans think they are the #1 nation but have no clue that they are paying two times more for way less quality than in Europe. It will only get worse.
Welcome to the United States of America where our ancestors had left Europe to come to The Land of Milk and Honey. It’s unbelievable that in less than 200 years since our ancestors came to this country, it’s time for their descendants to return to their homeland called Europe.
Great video. I summarise my take on this topic, as an Australian in France: less pressure in France to change your car or phone every year. Good state funded health insurance. Frugal habits. Difficulty getting a loan. No need to pay huge tips. Good market in second hand goods and less peer pressure to own the latest thing.
That is not entirely true. You only get a Carte Vital if you work in France. If you retire in France, even if you come from Europe, the Carte Vitaal costs around €900 for two people. Provided you have basic insurance in your country of origin, because then France can recover the costs in that country. Speaking from personal experience
@@fontfroide1 900 Euro a year for two people isn't much. I f you get an heart attack or cancer you will sell your house in the US and you will sell your pension fond to survive. In Europe it is a solidarity concept. In US you pay for yourself. Tell me what is better? If you like to have better service you still can pay for extra insurance on top for teeth etc. But this will be your personal decision. It is not to expensive. If you think you will have the money in the future 3000 or 4000 Euro on top you don't need any extra insurance. You are not forced to do so. But some people have not so much money extra and they pay an extra insurance on low cost every month. To be on the safe side in the future. I pay into public insurance from my pension about 120 Euro per month. That is 1600 Euro per year. And I don't cry.
I believe the Credit check is a bit different than explained. In France you start with blank credit failure. To secure a loan here: you must (1) have a stable source of revenue, (2) be under the maximum percentage of "endebtment" (e.g.: to borrow 80,000€ for a car you must earn between 4,000€ and 6,800€ / month), (3) your overall endebtment is considered by your bank 35% or your earnings, (4) You MUST NOT be blacklisted on the Banque de France list of bad payers. So believe me, a LOT of checks are made before you are granted a loan (age, income, debt/income ratio, marital status, etc). Those check are ALSO there to protect you against compulsive purchases that you could not pay-back.
These rules can be applied almost anywhere in the EU. Don't forget that after the crash, some of the rules in the EU, including those for lending, were standardized and tightened up (Basel 1-3). Among other things, it regulates how much money you need to have left to live on in order to be able to pay off the loan you have requested, and these figures change according to price developments and therefore the expected regular expenses.
@@dalriada7554und wenn du einen Verbraucherkredit in Deutschland beantragst, dann spielt auch eine Rolle wo du wohnst, wenn du Nachbarn hast, die häufig ihre Kredite nicht bedienen können/wollen,, hast du u. U. die bekannt A****Karte.
American living in Germany over 45 years. Liked your info, but for many in the states its really about the I WANT THAT mentality. They don't need a lot of the things, its about WANTING material goods such as couches.....
This tends to happen in a country that's spiritually diseased, with little sense of community and a toxic drip-feed of consumerist propaganda. Buying stuff is addictive: a desire is created by advertising or peer pressure, the unhappy person buys whatever it is and gets a hit of dopamine that lasts a day or so; then the effect wears off and the cycle is repeated. It all goes on the credit card with probable compound interest. It's as if people don't know what to do except throw around money most of them haven't even got.
Thanks for this video! I didn't understand why Americans were shocked that Warren Buffett lived in the same house all his life. Now I understand, thanks to you. In fact, we French are a people of savers, which drives the government crazy because it's less easy to tax given the debt problem.
I'm an Australian and I was diagnosed with stage 3 Melanoma in my liver, two years of scans and treatment with Immunotherapy, that was five years ago, and I didn't pay one cent. The total cost was around $500,000
From a french viewer perspective, it's a really interesting subject, and you are doing really well at explaining and illustrating. I'm glad you feel welcome here in France, and thanks for sharing!
Tu es contente que ces gens qui ont fait exploser ta facture d'énergie viennent voter pour e libéralisme effréné et la guerre just a coté de chez toi ? C'est du masochisme
If you’re in debt in France, you’ll never get a loan. Even though there’s no credit score, banks evaluate you on your capacity to save money depending on your financial situation and not be in debt, this will determine how much you can borrow. And that’s how a couple of blue collars can still borrow 200 k€ for their main residence. And in general when you buy, the banks expect you to bring 10% of the house price as a down payment, a proof that you were able to save despite renting.
NA. France people are still in debt. Households Debt To Income. Canada. 102.39% · United Kingdom. 83.17 · United States. 74.44 · France. 66.15 · Japan. 68.16 Germany. 55.1. Most of those debts are from student loan and home loan. France is not special when they are also rank top 10 without student loan. lol
One of the first thing my wife and I did after we got engaged back in the late 1980s was to go to a bank and borrow the money to buy a Mac Plus. Not because we couldn't have swung the expense but to build a joint credit score. And it went well for us. We always paid our bills on time, never ran credit card debt (one of the worst things you can do), bought used cars instead of new, and bought a house that was not a Macmansion and well within our means. Our credit score is great! We're quite conscious that we didn't live like most Americans. Some people sneered at the cars we drove or the size of our house but we are retired and able to live very well now because we lived in a way we could afford and saved for the future. Lots of Americans don't know how to do that.
It does seem horrible that people judge you by what you own rather than personality, intellect etc. Sounds like you are doing less harm to the planet than those addicted to consumerism.
I know people who ‘traded up’ houses every six or seven years just to get into that ‘one’ that would totally impress their friends! I lived in a very modest (cost less than most cars do now) row house for nearly forty years and after going through bankruptcy and health issues (husband died of Covid and diabetes); I finally moved to another modest single home that doubled in seller value in six years I’m now a millionaire and it’s all from saving and investing. I plan to move to Europe to ‘retire’!
In France, as with most European countries, your tax pays for your medical care and your children’s education. In the US those services are operated as businesses so there’s a percentage markup to satisfy shareholders resulting in a much more expensive product, which is one of the reasons people go into debt.
It’s not the only reason. InnFrance, the State being the official purchaser of all these medical services, it can much better negotiate with all the private sector providers. Sometimes, too harshly. A general practitioner consultation is only 30€, or a nurse coming to,your house for a blood sample won’t get more than 15€, and 2€ for her car expenditures. So, really too low. But when negotiating with Big Pharma, it sure helps keep the prices down.
In the Netherlands our medical costs are covered by commercial assurance companies. But they are obliged to take every customer. And to offer a basic package against a fixed premium. This package includes all necessary medical costs.
@@jonathanrees3401 You pay it from your salary or from your pension in percentage depending on your income. It is not a tax. Rich people over a an higher income are not forced to stay in public insurance (what I think is stupid, they should always be forced to pay minimum, everybody with no exception) they can get private insurance and pay private. But the crux is, if you get older and older the private insurance rises and in pension your salary is divided to 60% of your income. Now the "richer" people try to come back in public insurance. But that is not easy, and sometimes not possible. And these "rich" people now start crying. (But to much fun and free money in your youth you pay back in your age, you have to think for your age always) But the rest of explanation is ok.
@@amfrance but compared to the US education costs are relatively small by comparison. My daughter had over $150,000 of debt after she finished her Masters.
One thing you, no two things you didn’t mention were if you have a French bank account: 1 don’t bounce a cheque & 2 don’t go over drawn or you,ll be hearing from the central bank. In France on the whole you can only spend what you have.
I think the majority of Americans look at money differently than literally the rest of the world. Americans think if there is money in the bank there are toys (motorcycles, snowmobiles, trucks, guns, new cars, tech) to buy.
I'm always so excited to see a new video from you guys. Your sane but often humorous approach to your life in France and especially the differences with the US are great. I've lived in France and miss it very much but intend to return in 3-5 years time for my retirement and can't wait.
Less than 7% of mortgages in the US are issued with a variable rate. We all have fixed rates... At the peak, around 2007 20 to 30% of mortgages had a variable rate but lessons learned after the crisis.
There are credit cards in France. I happen to have two. In both case, the upper limit is 3000€. Each month, you can choose to pay the bill with no fees or go for the actual credit. That's called crédit revolving.
When you talked about couches, I looked around me. I am 70 and sitting on my third couch, well the third one I bought. There also is one that I inherited from my parents that inherited it in turn from my grandparents. Not the current style any more, but lots of memories connected to it. And in perfect working order! And I am sitting in the livingroom of my first house, that we bought just 36 years ago. Europeans plan differently, I think.
Another point is that houses in Europe are built to last longer. The status of a house is not related to its age so people don't move just to get a newer house.
Great opinion piece. As a European living in the USA I can easily understand your change in perspective. My wife and I have been spending 3 months a year living in a small village just outside of Perpignan for the past decade - we rent a house from a friend so don't have to deal with electricity and internet bills etc. We've been thinking of renting it year round but the EU 90 day rule is stopping us, my wife is American I'm British and having to drive our car from the Isle of Man to southern France and back every 3 months, via 2 ferries is way too expensive, plus my wife is only allowed to be in the "UK" for 6 months a year anyway. I was shocked to learn about credit scores in the US, as an immigrant, I didn't have one because I had no debt and didn't borrow money. Fortunately the local hometown bank knew I was professor at the University and would give me a loan for a home because I had a good stable job in a town where the university was the major employer, even then I was only asking for a relatively small amount of money (
And you don't appreciate what you have. You believe that it cannot be worse, only better. In reality things can always be worse and may not be better. Therefore there's no point to vote Front National whatever they call themselves
@@budapestkeletistationvoices I know that we are on RUclips and almost everything is allowed, but this kind of statement is extremely vulgar for a French person. We do not talk about our religion, our sexual practices, or our political opinions in public. It is considered extremely impolite and vulgar, avoid this kind of comment in France if you value your physical integrity (this is friendly and free advice).
@@CROM-on1bz and apparenty the French Fascists and Putinists discreetly take over the country. I didn't talk about my religion and sexual practices, but Marine Le Pen
@@CROM-on1bzWhat you described is a beautifully refreshing to this American. You do food, culture and Democracy so much better than we do in the States.
@@ursamajor7468 For cooking and culture, without a doubt these are a bit our strong points and then we have been training for at least 2000 years. 😊For democracy, well we try, we do our best even if sometimes there are snags.😏
Same in the Netherlands, debt works AGAINST you when trying to get a mortgage, whereas in the US, helps you in building your credit score, if you pay it off on time. All loans are registered that will be reviewed by anyone considering to give you a loan.
Most French people aim to own a home; renting is rarely a choice. The reason many rent is simply because they lack the means to buy. Retirement in France is, for many, not enough to live comfortably. What makes a difference is whether you own a fully paid-off home or not. Additionally, owning a home allows you to pass on something to your children, as France is very much an inheritance-driven society. In short, French people rent out of necessity, not by choice. As for the US, it’s up to each individual to buy a home that fits their needs and income - it’s a matter of personal responsibility.
I moved to France 7 years ago. When I lived in the states I made a lot of purchases using credit cards and It did take a few years to pay them all off. Since I moved to France, I use my bank's debit card, which makes me think twice before I purchase something --- do I really need this or is it an impulse purchase? I have plenty of money, but the fact that any purchase hits my bank account immediately has taught me the financial discipline I never had when I lived in the US.
It is so sad that debt, credit and credit reporting, and healthcare has become such big business in the US pricing the average American out of everything we hope to find in France.
In France you can also have credit cards called revolving credit. Interest is high ( more than 20% in general). And it’s a trap that can make you spend more than you should. And bank cards can also be direct debit. You choose what you prefer.
@@cashtrail4648 All the hypermarkets (carrefour, leclerc, auchan, etc.) in France propose their own revolving card in partnership with a well-known credit organization such as cofidis, cetelem, oney, etc. You can also go directly through these credit organizations to obtain a revolving card or a loan.
@@cashtrail4648 It is used by retail chains such as CARREFOUR, NORAUTO or CDISCOUNT. You have an available amount that you can use for a large purchase or repair. And then you pay a monthly payment to repay.
believe it or not, it's almost impossible to buy smaller cars... Some of the small models we have in European countries are not even sold here. And when we moved to the US a "small" car (like a ford fiesta or a toyota corolla) would cost just like a crossover/small suv... and for some reason, now used cars cost a lot of money (unless they are very old and with a lot of miles), we got one because a new one would require waiting for delivery and we needed a car quickly, but we saved very little :/ Another thing to consider: it's illegal to have a carseat in the front seat, and kids need to stay rear facing until at least 2yo, which makes it hard to fit the huge car seats they sell here in the back with small kids. Especially since many families here have 3 or more children
I am always amazed by your ability to understand your new country in such a short time. I think you are too polite to say it but the majority of French people still have a "peasant spirit" when it comes to money: A penny is a penny and you only spend what you have. Credit is only for life projects like buying a house which generally represents a heritage to pass on to your children. In France, no one talks about money but everyone thinks about it!
Having a "peasant spirit" would likely benefit a large % of Americans! As an American whose parents had very vivid (unpleasant) memories of growing up during the Depression in the 1930s, I was raised to be a saver/investor rather than a "spender". This has really served me well over the years. To quote my long-deceased mother, "Too many people foolishly live a 'champagne lifestyle' on a 'beer budget'".
As a french, I love the idea of the "peasant spirit" 😂 For the talk about money, yes we're very private but it's more than we don't want to brag about it or rub it in the face of someone that make less The salary that you earn does not define you as a person or the value that you have (nurses win less than traders but they're high value due to their actions) And money is a ressource like food, nobody need to know how many food I have in my fridge except if you're cooking with me ^^
I'm glad I'm one of these "peasant mentality" people. Besides a house loan, I've never borrowed any money in my entire life - and I'm in my mid 60's. Even for the cars I've owned: I started as a young driver with an old and small one that my parents left me then. When I had saved enough money I bought a new one, and I've always done so since. The same goes for everything I own, I'd rather save money for some time than pay instalments, thus only paying the net price of what I buy, no extra interest to pay for the loan - more money left for me. Of course, being in Europe, I never had to worry about going into debt on medical expenses or sending my children to college - that helps.
This has been an eye opener. Living in the UK, I still didn't know this about France. Feels like we have picked up a lot of bad habits from the US! Let's hope we get closer to European way of life. Another great video.
The US way of life is in a "great part" based on the UK way of life, the UK has adopted some European traits (With the corresponding high taxes) and the US has adopted some of its own ways like being spendthrift due to an "over reaching" economy!?!
I agree with what you said! Another reason why Americans have more debt than the French is student loans. As a French person living in the US I am still paying student loans. I would not have those if I had attended a university in France.
Omg, yes. We actually had a section on student loans in the video and a few other things, but it was just getting so long we had to edit. But this is another thing that feel completely out of control in the US and thus requires debt, the cost of education.
i regret every single day going to university in the USA. I'm currently in France right now working towards applying for my master's - which is about 60k+ in the USA for the exact same degree...
The issue with the US is that students are too immature to take out student loans responsibly and that private banks control the system. There are people out there with hundreds of thousands of dollars in student debt when all they have to show for it is a major in English and a job at McDonalds. In my country of Sweden, the Department of Education runs and operates CSN (The Central Student Aid Board) which decides the amount a student can get. It's divided into two parts: the first part is called "student support" for students who live at home and don't really have very many expenses. You don't need to pay back the student support grant. The second part is called "student loan" for students who have a place of their own where they pay rent, electricity and other things. This loan needs to be paid back with interest. Currently, the student support is ~$400/month and the student loan is ~$920/month. Total sum for both is ~$1320/month. The 2024 student loan interest is 1,23%.
@@WolfHeathen Well when you are young you dont know any better. I know for me i grew up poor, no guidance from parent, no access to internet, i didnt have a computer until i was 25, so i didnt know any better. But i did paid it off, took 12 years, and not much ability to afford anything else.
Thanks for your videos. It really helps me understand your country. I’ve there as a visitor but not long enough to experience the life of american citizens. I never truly understood the credit cards system. The interest rates are really awful. In France you apparently choose to have a end of the month payment for your expenses. But you can choose to have your expenses taken from you cash account immediately (that’s what I do because I don’t want to be in debt at the end of the month). Anyway your videos are wonderful wether you are talking about France or the US.
If French are like Poles, many do not move - so they stay in the same town in the same home their whole lives and then the kids inherit it. It means homes get paid off.
There are credit cards in France. They are distributed by organism like Sofinco or Cetelem instead of banks. From my experience, the spending limit is 3000€. You can either pay up at the end of the month, and this comes with no fees, or go the credit route (19,6%). Also, we have no credit score, but if you don't pay your debt, you might end up banished by la banque de France.
The FICO score (Fair, Issac and Company) was invented in 1989. While other forms of credit scoring existed, especially for Business, there was a time not too long ago when we were similar to the French in this matter.
Interesting that you were taught that debt was part of being responsible. I'm 62 and actually I was never taught that. We were taught to pay off the c/c before they incurred interest
I was one of those who was taught about responsible debt & I'm a bit older than you. Anyone who went to University between 1970 and 1990 got a good education in the finance system, the purpose and use of c/c, and the need for a good credit history. I was already getting asked about my credit history in 1978 when I bought my first new car to replace the used one I got with help from my grandparents.
I really am impressed by the quality of your channel. Your sincerity, your analysis, they reaveal a true intelligence and a rare capacity to see beyond the apparearences. I want, by these words, to congrat you both, for the boldness of your choices and for the trueness of your communication. In fact, it is a high conscienceness path, not theorical, but deeply rooted in the material world, the most difficcult one, because, as your justly put it once in one of your videos, it reveals that we are just idiots when we are extracted of our cultural world, and this is why most of them are prisonners of our social programmation. Now you are free ! I wish your example could inspire as much persons as possible :)
Me as a Belgian and most Europeans don't have credit card. I have a Bank card but that is directly linked my account. So when I make a payment it instantaneously goes of my account and I can not go negative, my choice. A credit card is a debt card and I don't want to accumulate debts.
The downside of the french banking system is that fees are very high, it is next to impossible to move your asset from one bank to another if you are unhappy with your current bank, managing fees of investment accounts are outrageous in france.
was the case before, but with "portability" you can now move from bank to bank in a (theoretically speaking) seamless way. Might take a few weeks to get it all sorted out depending on the bank. And fees can be reduced drastically by using an online bank like BoursoBank, Fortuneo, etc.
I wish all American electors had seen this 3 weeks ago :) I think we Brits should also mover closer to the European models on Debt, Credit, Housing and Health Care. Fantastic video . This ageing British Francophile will certainly be checking out your channel.
Hi, nice video but there are a few things missing. As 29 year old french, here's how me and my wife have very little debt in addition to what you said: - No car payments, we buy vehicles we can afford or we buy used. Sure, I drive a 7 year old Dacia Sandero, but in the end it's just a tool to get me from A to B, it's simple and it works. I feel like americans always want to buy a nice new car on credit to impress their neighbors. In France you see more old cars still running, fewer large shiny SUVs (although this is starting to change too). - No student debt. The top universities of the country are free, or almost free. I went to the top computer science school and paid 75€ for my engineering degree thanks to my scholarship. Without scholarship it would have been 400€/year which is really not a lot. My wife went to the same school, so no debt. - Very small housing debt: now this is not true for everyone because many french people buy the biggest home they can afford and just stay in it forever; but we chose to buy a small appartment that's just the right size for us two, we were able to pay more than half of it as a down payment and just owe around 70k, which translates to around 450€ monthly payments. If we have kids, we can rent this one for 900€/month and buy a bigger home. - No overconsumption debt: In France, people just buy less stuff than in the US. We see fewer ads, we have less money in general, and less access to credit. It's very rare to buy something with money we don't have, unless it's a house... We have this culture of saving before buying.
I used to comment to my American friends that the French buy smaller cars even if they have kids but am shocked to see the increase in SUV sales in France even in cities where they make 0 sense :-( It's sad that many French families are falling in the SUV trap.
@@jplebihan I guess the silver lining is that french SUVs such as the Peugeot 5008 are still tiny compared to american SUVs like the Chevrolet Suburban that you see everywhere over there. 😅
SUV’s are the biggest car segment in Europe with 3M cars sold 2022 data. 25% of cars in my country are 20+ years old, according to stats 80% of new car sales are from companies.fuel is also more expensive and Europe.
What about chargeback credit cards? I (living in Germany) do shoping with one and it is paid in full at the end of the month. Keeps fixed expenses separate from variable ones. One with revolving credit or some shady ways to milk money from me I'd avoid.
Hi, being a dual EU-US citizen, I totally agree with your comparison of the 2 cultures. You might want to mention consumer credit companies becoming more prevalent in France - such as Cetelem just to name a popular one. Many people use that form of credit now and get into trouble because as a people, we do not have a culture of debt management.
In France, by law all your credits (house, car, ...) can't exceed a certain % of your salary, but many credit business "forget" to check that ! Then yes some people are catch. in the debts spiral.
@@brigittelacour5055 35 % maximum of your income ... but , yep , some credit agencies will cheat on your income to push the credit line on you. There's a last " garde-fous " in France = % interest Rate can't exceed le " taux d'usure " by law.
I'm a happy American. I have no debt, including my house. I retired 3 years ago at 50. All my vehicles are over 4 years old and paid off. My phone cost me less than $200 on Amazon. I don't eat out because I think it's gross. I do make a little money restoring classic cars; but I'd do that even without the money. I didn't incur any student loans. I started an HVAC business (mostly residential) and became my own boss when I was 22 years old after working for someone else for 3 years. I have an investment income of about $160,000 per year. For full disclosure, my wife works part time at Costco (because she likes it?!?!?!) after staying home with the two kids for 15 years. They have really good health insurance. There's nothing wrong with the United States of America. You just have to work hard, be ambitious, and stay out of debt. There is no good debt....there's bad debt and worse debt.
@@bokhans yet without the Versailles treaty, war reparations, the gold standard, 10,000% inflation, kristallnacht, nor the great depression, the occupation of Czechoslovakia, nor.......YOU BIG DUMMY. Crack a book sometime.
Do this for french people in the future , and in French language 😁 ,to explain to french people , who complains so much , or who Dreams about USA way of life , how lucky they are 😁
@@JeanlucPerez-u3g The dream is to live in France while keeping your professional activity in the US, thus benefiting from a much higher salary. That’s the real lesson. You take advantage of both sides and live in the country where the cost of living is lower. Nothing to criticize, but it’s not comparable to the life of the locals…
we are not lucky in the most communist country in the world sheeeesh wake up! we pay more taxes than in China. Expats from the US dont see that as they pay their taxes in the US.
@@mohakadecincy2413 Yeah....... My dad is French and watching my French grandparents and friends going about their very relaxed daily life was always a joy.
Nice video and knowledgeable , i use to travel in the US for business but US is now like Switzerland , very high cost country In Miami , 45 $ a breakfast not really fancy , I asked for a fresh orange juice and the server brought another 15 $ bill Amazing !!! Uber was affordable but apart this … I have seen that average income for a household is 100 k$ a year which is not case in France but with those kind of costs . You need this even more to be equal with France
$5000 deductible and $500 a month for health insurance!?! Wow... $6000 a year gambled on the long odds that I'll get sick? I have zero bills that large, my mortgage costs less per month...
Absolutely........ UK citizen here. Six hours in ER with scans, blood tests and blood thinners........ $8,500 +$850 prescription. Overnight hospital stay with scans, blood tests and an injection for a bad stomach.... $9,700. Those were two "simple" visits to US healthcare providers. My "American " daughter's in-laws have to call their insurance company to check which doctor, hospital or pharmacy they can use when visiting as they are "out of state" which incurs extra charges...
It seems that cost of living is lower in europe, mainly because of health insurance. Interest rates are about half compared to USA. Living in Europe is more cost effective, If you have a remote job or a reliable source of income. Because of high standards, their food is healthier and, in most cases, fresher, which translates to healthier living. america has become the land of corporate greed. My countdown = 16 months- retire to france !!!🎉
In the Netherlands the credit cards are mostly also glorified debet cards, for which at the end of the month the whole expenditure must be paid for. This is a big plus, in my opinion. No piling off debt!
Good points. A big difference when it comes to housing debt is that mortgages are very unusual in France. When you buy a home, you take a regular loan that is not backed by an asset. Of course, in practice the bank will still end up forcing the sale of your house if you cannot repay the loan. But that still makes a big difference: the loan on your home is meant to be repaid in full in 20 to 30 years (as opposed to only paying interests and jumping from one mortgage to the next), and since the loan on your home is not a mortgage, you cannot release equity/borrow more when the value of your house has increased. This means that you are not pushed to take on financial leverage and roll debt during your entire life. On a more systemic level though, I tend to like the American approach. The appetite of Americans for debt and financial leverage also reflects certain priorities (less aversion to risk, a higher dose of optimism, a more forward-looking mindset... - these are not bad things, they also make for a more mobile, dynamic society).
@@mikebarnes2294 You are pointing out another thing that Europeans do NOT understand. In France the average person works for 3 companies in their lifetime, while in the USA the average is 12 companies. As a result almost all French workers rarely if ever move, while in the USA an employee has to move hundreds or thousands of kilometers every 4.5 years, requiring them to buy & sell a home or pay exorbitant rents. these alone requires some sort of housing debt being changed every 4.5 years.
It’s not easy to fire an employee in France. In the US it can happen for any reason or no reason and at anytime so a letter about an American’s job is worthless.
Just an FYI for all of you across the pond. In 28 of the 50 states in the USA have working class people who are AGAINST worker’s rights. They have voted to make their areas so-called “right-to-work” laws. These basically prohibit or at least hamstring any organized labor activity. These same states are the ones that impose the restrictions that make the news in the rest of the world regarding women's rights. There is little likelihood that these will change in the next fifty years.
Yup the "right to work" states ( many Republican states). I worked in Idaho and during a merger in a small company a young female manager came in and fired me because I refused to fire some of my staff while she kept her staff. Well I left and wrote to the head office and they fired her!!!
Your credit card discussion is only partly true. You can ask (and it usually comes by default like that) for the money to be taken from your account immediately. What you're describing sounds like "carte de crédit à débit différé", where the money would leave your account on a specific date each month. You can also ask for "carte de crédit à débit immédiat" and the money gets removed under two-three days. It's also possible (at least in my bank) to switch between the two rather easily, maybe it's just a flip of a switch in my bank app or sth like this.
It is a huge cultural difference. there is a reason why US has the biggest and most profitable banks in the world. the money has to come from somewhere. somehow they managed to convice/force the US people to hand over the dollars to the banks. there is no score in france but a legel limit of 33% of your income that is going into debt reimbursment. and the bank are not allowed to lend money over that limit
Having moved from France back to the US in 2006, we had no credit history in the US so we had to get a special debit card with a ceiling that corresponded to the amount that we had placed in an immobilized account. What was especially infuriating was that the correspondence that we would receive from the bank was usually only in Spanish. The notion that a private company should determine your risk profile based on purely confidential and proprietary criteria is pure insanity in my opinion.
Ah, the USA ultra-crony capitalism - you have to love our constant ways of inventing ever more intrusive ways to make "free" people act like indentured servants.
I'm in the Netherlands. I do have a credit card, but I only use it in case of emergency, I.E. when I absolutely don't have any other way to pay for something (for travels, mostly). I was raised with the idea of "If you can't afford it, you shouldn't buy it"
I grew up in Paris, and live in the US. I still will pay more for better groceries, have a small wardrobe, and paid off our houses in 15 years. ( houses- one is for our business office and one to live in). On a lower middle class income. Before Medicare, we were paying $1400 each a month in insurance through my company. French healthcare is excellent. My family still lives there
Great video! Ive been in Spain for 12 years now and it's the same deal as in France. I wouldnt trade it, I'd probably do really well moving back to the US but i enjoy the peace of mind living in Spain. Dont use a credit card here either.
I just signed upbto work with a mindset coach due to my fear of selling my home while planning to move to France. Your video helped me tremendously toward my ties to something, as you say the bank owns and not me. 😊
Great video as always. Very interesting to learn about this debt culture in the US. Very different as you said from what we are used to in France. I would like to make a clarification though. If I'm not mistaken, credit cards like the ones you have in the US do exist in France. They're not the main payment mean banks offer but you can find many companies providing them (for example, the "Carte PASS" from Carrefour). Generally these credit cards allow you to choose either a direct payment in full or a credit payment that you reimburse monthly with interests. And, indeed, as you said in the video, banks generally offer debit cards instead, but not all of them are "delayed debit" cards. I think most of them are in fact "immediate debit" and you have to opt in for delayed debits.
I enjoy your videos. I immigrated to Switzerland 8 years ago. What is so interesting is the mixture of similarities and differences between France and Switzerland. Mostly home ownership is much lower in Switzerland than in either France or the USA. Moreover, Swiss homeowners tend to carry mortgage debt a long time and even refinance to keep a mortgage. Interest rates here have been low for decades (how does 0.5% sound to you). In addition, homeowners calculate and imputed rental income on a home, which is reported-and taxed-on their income tax returns.
I can relate... being from Belgium and moved to Canada I was shocked by the credit score system and how easy it is to contract debt... My Canadian wife at the time had no job and could go to a car dealership and leave with a car the same day without paying anything!!! I've never seen something like that before... Same for the never ending re-finincing of houses... I was thinking: "So... you guys never own your house ?!" ... So many things seemed messed up here in Canada. It is so interesting to understand both systems and "cultures"; and use the system at our advantage while being well informed (and absolutely not subscribe to the "keep up with the Joneses" mentality in North America... when I see how people live here, the car they drive and the median salary... I know everybody is deep in debt for sure :) )
I could not live in the USA. The health insurance issue would be one that would keep me awake nights and in a constant state of panic. As someone who worked their entire life and was able, through a lifetime of prudence to retire at 57, I was diagnosed with lung cancer after a lifetime of no smoking or drinking at 60. Supposing I could have retired in the first place, would I be filing for bankruptcy to pay my medical bills? It would seem a high price to pay.
No, we don't let most of our folks with serious illnesses get help, many of them lose out. There is no safety-net, just VERY hard reality of tough luck & hard work or you get run over by USA ultra-capitalism. The USA can be a very cruel place where you survive or not. Those who are unlucky or too weak get caught in our social Darwinism. Why do you think we call it a healthcare INDUSTRY.
You'd have been fine for the last 14 years, with the Affordable Care Act; I had $300,000 in claims but my insurance paid for all of it. It is more expensive. If you could make to 65, you get mostly free health care through the Medicare program, and it's very similar to the French system. If you're under 65, the new president will repeal the Care Act and yes, you'd be looking at bankruptcy. I don't like it. But at least millions of people who voted for him will lose their coverage and go bankrupt, too. And I'm going to laugh and laugh at them. It's all I got.
I moved to Germany in 2008, when there were no credit cards in the country. On one side, it's true that German banking is obsolete, but on the other side, the government simply precented Visa and Master Card from running Germans into debt.
The average European's life style is way, way more frugal than an American one. Although things changed a lot over the last 25 years, still, there is no comparison. A European earns 1000 and spends 850 each month An American earns 1000 and spends 1700 each month
My biggest regret last year when I sold my house was turning right around and buying another one right away. I do own my house outright, but I am burdened with taxes, insurance, maintenance, and so many other things that it's pretty expensive even with no house payment. I am ready to sell and bounce out of this situation. I would love to be in France.
Technically in France, if you are bad at honouring your debt, you can be filed at the Banque de France. This can be an obstacle to take a loan with good interest rates (but not a job^^) for the next 10 years (afterwards the "droit à l'oubli" erases your debt history). Note that if you are drowning in debt, you can ask for a "demande de surendettement" so the state erases your debts: a citizen with a clean slate and a second chance is a better economic actor than a citizen that made a mistake once and is stuck in a vicious circle.
In Europe we have both credit cards and debit cards. Debit cards, we use in stores, and the money comes directly from your account. Credit cards, you use for online shopping (but not, generally, as a "loan"). You can use your debit card online as well, but it doesn't have the same protections, and you don't always want online stores to have the ability to withdraw directly from your "cash" account.
While linvin in the US we paid our credit card balance in full each month. After a year we got a call and they offered a gold card, at an extra fee. We asked why we would do that. Well, so that we could buy more. But we always saved for stuff, so we said we do not need it. She was astonished..
In America, there are only private debts, while in France, it’s all about public debts… or wait a second-actually, in America, there are massive private debts and massive public debts!
How did you get that 40% number tho ? Because you can double French salaries to know what the company actually pays, a lot gets taken out automatically (no opting out) for retirement, healthcare, unemployment insurance, etc.... Which isn't considered "incomes" (no tax). Someone earning 40K before taxes in France is actually being payed 80k by the company. Something everyone seems to be forgetting when comparing to the US, French included ! On another note there is a commonly held principle in France that the only loan you should ever take is a mortgage. We do have things like revolving credits, etc... But they are seen as something for the financially illiterate. Even car loans are frowned upon in most case....
You are right, even car loans are frowned upon. I have taken one anyway as I managed to pay 0.5% interest rate (as it is an EV) even if I could pay the car cash. It is better to have a 0.5% loan and use my cash to buy ETF on my PEA.
It wozld be interesting to compare the income and tax. Not only what they aum up to, but what is payed with it that otherwise has to be bought privately (healthcare, education, ...)!
I'm french and really enjoy your vidéos. healthcare of the french system is rather a good system. However it's better to subscribe a "mutuelle" to cover expanses that are not taken care by the Healthcare french Social Security. For exemple: if you need to be hospitalised some of the charges still charged and not re imbursed . Therefore the Mutuelle's suscriptions are not as expensive as it could be it the USA. Can go from 50 to 160 euros per month (average) and covers many things. It's covering some of the Dental, ophtamilogist, extra costs at the hôpital. etc.
Good video! Lived in Europe for 35 years, worked in France even, but this video applies to most European countries. In America, we live on debt because banks have convinced us that "debt is good", like DeBeers Mines convinces you that a big diamond proves you love your girlfriend/wife. Europeans do not buy the things we in America seem to have to have. In Europe, college is mostly free, you inherit your house half the time, you buy a car you can afford (lots of safe, no-scam used cars around, and consumer laws are much tougher here). Personal bank relationship is practically essential, and we have had ours for 25 years, through 3 bank mergers ... yes, taxes are high but now much compensation comes in company bennies and pay bonus', which are taxed at a lower rate. You get unbelievable low/no cost health care, unemployment (if it happens) and other social benefits. Large companies often provide a company car, on-site commissary and company meals, free holiday venues and even subsidized housing and/or low-interest loans. Europeans in general have less volatility in their employment and better job security, which reduces debt-inducing stints of unemployment and stressful job searches, and fewer costly relocations for job change or for "moving up". But, in the end, people in Europe just seem to need less consumer goods, ... they value quality of life over that next dollar ...
I'm America and we, my husband and myself, our only debt is our house. We don't buy into the "CHARGE IT" culture. We don't have credit cards. We do have vehicles & a camper that are paid off. Our next task it to pay off our mortgage! Not every American buys into debt. There are some weird folks like us! We definitely don't want to retire with a mortgage payment! Thusly we are going to pay that off!
![BRASIL vs. URUGUAY [1-1] | RESUMEN | ELIMINATORIAS SUDAMERICANAS | FECHA 12](http://i.ytimg.com/vi/-hWBAuxF1eY/mqdefault.jpg)
I'm Italian and I've lived in Germany, England and the US. Here in the US our income doubled, BUT everything costs more. A swim lesson for our kids costs like a month of swim lessons in London. Same for ballet. Summer camps here are on the tune of 400$ per week per child. I grocery shop at Aldi and we still spend more. We have to have 2 cars and we can't walk anywhere. We pay for part of our health insurance, dental insurance and vision. It is insane, and I don't think we will stay here long term... Social pressure is only a small tiny part of the issue
I'm Austrian and live in the US with my Austrian wife and our child. Same here, everything costs so much money. Car repairs are done sloppy and bad, you have to come back a few times to actually fix issues. The infrastructure is extremely poor. We have been here 15 years and will go back next year. Americans think they are the #1 nation but have no clue that they are paying two times more for way less quality than in Europe. It will only get worse.
Welcome to the United States of America where our ancestors had left Europe to come to The Land of Milk and Honey. It’s unbelievable that in less than 200 years since our ancestors came to this country, it’s time for their descendants to return to their homeland called Europe.
Now is a particularly good time to leave the U.S. especially since many Americans will be, myself included.
Great video. I summarise my take on this topic, as an Australian in France: less pressure in France to change your car or phone every year. Good state funded health insurance. Frugal habits. Difficulty getting a loan. No need to pay huge tips. Good market in second hand goods and less peer pressure to own the latest thing.
That is not entirely true. You only get a Carte Vital if you work in France. If you retire in France, even if you come from Europe, the Carte Vitaal costs around €900 for two people. Provided you have basic insurance in your country of origin, because then France can recover the costs in that country. Speaking from personal experience
Why do you feel pressured to have the latest thing? Sounds like they've got you where they want you.
@@fontfroide1 900 Euro a year for two people isn't much. I f you get an heart attack or cancer you will sell your house in the US and you will sell your pension fond to survive. In Europe it is a solidarity concept. In US you pay for yourself. Tell me what is better? If you like to have better service you still can pay for extra insurance on top for teeth etc. But this will be your personal decision. It is not to expensive. If you think you will have the money in the future 3000 or 4000 Euro on top you don't need any extra insurance. You are not forced to do so. But some people have not so much money extra and they pay an extra insurance on low cost every month. To be on the safe side in the future. I pay into public insurance from my pension about 120 Euro per month. That is 1600 Euro per year. And I don't cry.
I believe the Credit check is a bit different than explained. In France you start with blank credit failure. To secure a loan here: you must (1) have a stable source of revenue, (2) be under the maximum percentage of "endebtment" (e.g.: to borrow 80,000€ for a car you must earn between 4,000€ and 6,800€ / month), (3) your overall endebtment is considered by your bank 35% or your earnings, (4) You MUST NOT be blacklisted on the Banque de France list of bad payers. So believe me, a LOT of checks are made before you are granted a loan (age, income, debt/income ratio, marital status, etc). Those check are ALSO there to protect you against compulsive purchases that you could not pay-back.
and of course, different rules for loans to buy a house.
The rules are aimed at "consumer loans" (while buying a house is an investment)
These rules can be applied almost anywhere in the EU. Don't forget that after the crash, some of the rules in the EU, including those for lending, were standardized and tightened up (Basel 1-3). Among other things, it regulates how much money you need to have left to live on in order to be able to pay off the loan you have requested, and these figures change according to price developments and therefore the expected regular expenses.
@@dalriada7554und wenn du einen Verbraucherkredit in Deutschland beantragst, dann spielt auch eine Rolle wo du wohnst, wenn du Nachbarn hast, die häufig ihre Kredite nicht bedienen können/wollen,, hast du u. U. die bekannt A****Karte.
😊😊
American living in Germany over 45 years. Liked your info, but for many in the states its really about the I WANT THAT mentality. They don't need a lot of the things, its about WANTING material goods such as couches.....
Marketing tells people what they should want. And, Americans are good at doing what they’re told to do.
This tends to happen in a country that's spiritually diseased, with little sense of community and a toxic drip-feed of consumerist propaganda. Buying stuff is addictive: a desire is created by advertising or peer pressure, the unhappy person buys whatever it is and gets a hit of dopamine that lasts a day or so; then the effect wears off and the cycle is repeated. It all goes on the credit card with probable compound interest. It's as if people don't know what to do except throw around money most of them haven't even got.
Thanks for this video! I didn't understand why Americans were shocked that Warren Buffett lived in the same house all his life. Now I understand, thanks to you. In fact, we French are a people of savers, which drives the government crazy because it's less easy to tax given the debt problem.
I'm an Australian and I was diagnosed with stage 3 Melanoma in my liver, two years of scans and treatment with Immunotherapy, that was five years ago, and I didn't pay one cent. The total cost was around $500,000
From a french viewer perspective, it's a really interesting subject, and you are doing really well at explaining and illustrating.
I'm glad you feel welcome here in France, and thanks for sharing!
Tu es contente que ces gens qui ont fait exploser ta facture d'énergie viennent voter pour e libéralisme effréné et la guerre just a coté de chez toi ? C'est du masochisme
If you’re in debt in France, you’ll never get a loan. Even though there’s no credit score, banks evaluate you on your capacity to save money depending on your financial situation and not be in debt, this will determine how much you can borrow. And that’s how a couple of blue collars can still borrow 200 k€ for their main residence. And in general when you buy, the banks expect you to bring 10% of the house price as a down payment, a proof that you were able to save despite renting.
In America you can go bankrupt a number of times and still get loans Just ask Trump, In fact you bankruptcy can help offset from future taxes.
NA. France people are still in debt.
Households Debt To Income. Canada. 102.39% · United Kingdom. 83.17 · United States. 74.44 · France. 66.15 · Japan. 68.16 Germany. 55.1. Most of those debts are from student loan and home loan. France is not special when they are also rank top 10 without student loan. lol
One of the first thing my wife and I did after we got engaged back in the late 1980s was to go to a bank and borrow the money to buy a Mac Plus. Not because we couldn't have swung the expense but to build a joint credit score.
And it went well for us. We always paid our bills on time, never ran credit card debt (one of the worst things you can do), bought used cars instead of new, and bought a house that was not a Macmansion and well within our means. Our credit score is great!
We're quite conscious that we didn't live like most Americans. Some people sneered at the cars we drove or the size of our house but we are retired and able to live very well now because we lived in a way we could afford and saved for the future. Lots of Americans don't know how to do that.
Guess you knew enough maths to be able to estimate whether you could
pay the loan back or not.
It does seem horrible that people judge you by what you own rather than personality, intellect etc. Sounds like you are doing less harm to the planet than those addicted to consumerism.
I know people who ‘traded up’ houses every six or seven years just to get into that ‘one’ that would totally impress their friends!
I lived in a very modest (cost less than most cars do now)
row house for nearly forty years and after going through bankruptcy and health issues (husband died of Covid and diabetes); I finally moved to another modest single home that doubled in seller value in six years
I’m now a millionaire and it’s all from saving and investing.
I plan to move to Europe to ‘retire’!
There’s an old saying in France that epitomizes the cultural difference:”qui paye ses dettes s’enrichit”.
Says it all
In France, as with most European countries, your tax pays for your medical care and your children’s education. In the US those services are operated as businesses so there’s a percentage markup to satisfy shareholders resulting in a much more expensive product, which is one of the reasons people go into debt.
US people are screwed by banks, insurances, insurances, colleges, what not.
It’s not the only reason. InnFrance, the State being the official purchaser of all these medical services, it can much better negotiate with all the private sector providers. Sometimes, too harshly. A general practitioner consultation is only 30€, or a nurse coming to,your house for a blood sample won’t get more than 15€, and 2€ for her car expenditures.
So, really too low.
But when negotiating with Big Pharma, it sure helps keep the prices down.
In the Netherlands our medical costs are covered by commercial assurance companies. But they are obliged to take every customer. And to offer a basic package against a fixed premium. This package includes all necessary medical costs.
That's not always the case. Neither me or my children have any problems paying our bills. It's the way you handle your finances.
@@jonathanrees3401 You pay it from your salary or from your pension in percentage depending on your income. It is not a tax. Rich people over a an higher income are not forced to stay in public insurance (what I think is stupid, they should always be forced to pay minimum, everybody with no exception) they can get private insurance and pay private. But the crux is, if you get older and older the private insurance rises and in pension your salary is divided to 60% of your income. Now the "richer" people try to come back in public insurance. But that is not easy, and sometimes not possible. And these "rich" people now start crying. (But to much fun and free money in your youth you pay back in your age, you have to think for your age always) But the rest of explanation is ok.
We move in a week,your videos have helped a lot.
Definitely looking forward to arriving and being debt free
Good luck and safe travels!!
Come living the French dream!
@@PonyMonbana No don't come .....No one wants you there
You forgot to speak of students debts ! In France, college is free, which is far from being the case in America...
And in France do you think they let in any idiot who graduated high school. The standards are very high
Nothing is free.
The grande écoles are far from free. ;)
@@8HouseIt is a different system. Yes you need money to go to an elite school. But standard education is very good too.
@@amfrance but compared to the US education costs are relatively small by comparison. My daughter had over $150,000 of debt after she finished her Masters.
One thing you, no two things you didn’t mention were if you have a French bank account: 1 don’t bounce a cheque & 2 don’t go over drawn or you,ll be hearing from the central bank. In France on the whole you can only spend what you have.
I think the majority of Americans look at money differently than literally the rest of the world. Americans think if there is money in the bank there are toys (motorcycles, snowmobiles, trucks, guns, new cars, tech) to buy.
I'm always so excited to see a new video from you guys. Your sane but often humorous approach to your life in France and especially the differences with the US are great. I've lived in France and miss it very much but intend to return in 3-5 years time for my retirement and can't wait.
Merci 😊
Tell me how you plan to do that. Apparently you speak French well! I speak minimally!
@@pamsmith7369 was that question intended for me?
A very important difference is that in France we don't use variable rates for our mortgage loans. So no surprises during the credit payments.
Less than 7% of mortgages in the US are issued with a variable rate. We all have fixed rates... At the peak, around 2007 20 to 30% of mortgages had a variable rate but lessons learned after the crisis.
En France on peut avoir du variable, fixe ou capé.
There are credit cards in France. I happen to have two. In both case, the upper limit is 3000€. Each month, you can choose to pay the bill with no fees or go for the actual credit. That's called crédit revolving.
Most U.S.A. mortgages are almost always fixed rate 30 year loans
When we lived in USA for 7 years we INSISTED to have a FIXED rate, it is possible if you ask. We even refinanced when rates dropped once 😊
When you talked about couches, I looked around me. I am 70 and sitting on my third couch, well the third one I bought. There also is one that I inherited from my parents that inherited it in turn from my grandparents. Not the current style any more, but lots of memories connected to it. And in perfect working order! And I am sitting in the livingroom of my first house, that we bought just 36 years ago. Europeans plan differently, I think.
I am French too and I am planning to sell my house, not to buy a bigger one but a smaller one as I don't need such a big house anymore.
My parents lived in one house their entire lives. I've lived in the same house for roughly 23 years.
Another point is that houses in Europe are built to last longer. The status of a house is not related to its age so people don't move just to get a newer house.
Great opinion piece. As a European living in the USA I can easily understand your change in perspective. My wife and I have been spending 3 months a year living in a small village just outside of Perpignan for the past decade - we rent a house from a friend so don't have to deal with electricity and internet bills etc. We've been thinking of renting it year round but the EU 90 day rule is stopping us, my wife is American I'm British and having to drive our car from the Isle of Man to southern France and back every 3 months, via 2 ferries is way too expensive, plus my wife is only allowed to be in the "UK" for 6 months a year anyway. I was shocked to learn about credit scores in the US, as an immigrant, I didn't have one because I had no debt and didn't borrow money. Fortunately the local hometown bank knew I was professor at the University and would give me a loan for a home because I had a good stable job in a town where the university was the major employer, even then I was only asking for a relatively small amount of money (
I'm french, so I know a little my own country, but I wait for your next video every time I saw the last one. 🤣Good job 👍
And you don't appreciate what you have. You believe that it cannot be worse, only better. In reality things can always be worse and may not be better.
Therefore there's no point to vote Front National whatever they call themselves
@@budapestkeletistationvoices I know that we are on RUclips and almost everything is allowed, but this kind of statement is extremely vulgar for a French person. We do not talk about our religion, our sexual practices, or our political opinions in public. It is considered extremely impolite and vulgar, avoid this kind of comment in France if you value your physical integrity (this is friendly and free advice).
@@CROM-on1bz and apparenty the French Fascists and Putinists discreetly take over the country.
I didn't talk about my religion and sexual practices, but Marine Le Pen
@@CROM-on1bzWhat you described is a beautifully refreshing to this American. You do food, culture and Democracy so much better than we do in the States.
@@ursamajor7468 For cooking and culture, without a doubt these are a bit our strong points and then we have been training for at least 2000 years. 😊For democracy, well we try, we do our best even if sometimes there are snags.😏
Same in the Netherlands, debt works AGAINST you when trying to get a mortgage, whereas in the US, helps you in building your credit score, if you pay it off on time. All loans are registered that will be reviewed by anyone considering to give you a loan.
Yes, even your phone subscription if it includes the cost of buying a new phone !
Your credit score is only part of the information taken into consideration obtaining a mortgage
Most French people aim to own a home; renting is rarely a choice. The reason many rent is simply because they lack the means to buy. Retirement in France is, for many, not enough to live comfortably. What makes a difference is whether you own a fully paid-off home or not. Additionally, owning a home allows you to pass on something to your children, as France is very much an inheritance-driven society. In short, French people rent out of necessity, not by choice. As for the US, it’s up to each individual to buy a home that fits their needs and income - it’s a matter of personal responsibility.
I moved to France 7 years ago. When I lived in the states I made a lot of purchases using credit cards and It did take a few years to pay them all off. Since I moved to France, I use my bank's debit card, which makes me think twice before I purchase something --- do I really need this or is it an impulse purchase? I have plenty of money, but the fact that any purchase hits my bank account immediately has taught me the financial discipline I never had when I lived in the US.
It is so sad that debt, credit and credit reporting, and healthcare has become such big business in the US pricing the average American out of everything we hope to find in France.
In France you can also have credit cards called revolving credit. Interest is high ( more than 20% in general). And it’s a trap that can make you spend more than you should. And bank cards can also be direct debit. You choose what you prefer.
Yes, I agree, very expensive. That's why it doesn't work so much in France. Even if some people recourse to them.
no one uses them
I've never seen this offered in France so I'm surprised by what you say. I've only ever had the choice between instant debit and deferred debit.
@@cashtrail4648 All the hypermarkets (carrefour, leclerc, auchan, etc.) in France propose their own revolving card in partnership with a well-known credit organization such as cofidis, cetelem, oney, etc. You can also go directly through these credit organizations to obtain a revolving card or a loan.
@@cashtrail4648 It is used by retail chains such as CARREFOUR, NORAUTO or CDISCOUNT. You have an available amount that you can use for a large purchase or repair. And then you pay a monthly payment to repay.
When I go to the USA I see huge new cars and trucks being driven, in France not many people care what car they drive
Americans are largely foolish enough to take on large debt payments to try and buy status with a depreciating asset.
believe it or not, it's almost impossible to buy smaller cars... Some of the small models we have in European countries are not even sold here. And when we moved to the US a "small" car (like a ford fiesta or a toyota corolla) would cost just like a crossover/small suv... and for some reason, now used cars cost a lot of money (unless they are very old and with a lot of miles), we got one because a new one would require waiting for delivery and we needed a car quickly, but we saved very little :/ Another thing to consider: it's illegal to have a carseat in the front seat, and kids need to stay rear facing until at least 2yo, which makes it hard to fit the huge car seats they sell here in the back with small kids. Especially since many families here have 3 or more children
Thanks for this video which goes to the essence of cultural difference between the USA and France.
I am always amazed by your ability to understand your new country in such a short time.
I think you are too polite to say it but the majority of French people still have a "peasant spirit" when it comes to money: A penny is a penny and you only spend what you have. Credit is only for life projects like buying a house which generally represents a heritage to pass on to your children.
In France, no one talks about money but everyone thinks about it!
Having a "peasant spirit" would likely benefit a large % of Americans! As an American whose parents had very vivid (unpleasant) memories of growing up during the Depression in the 1930s, I was raised to be a saver/investor rather than a "spender". This has really served me well over the years. To quote my long-deceased mother, "Too many people foolishly live a 'champagne lifestyle' on a 'beer budget'".
As a french, I love the idea of the "peasant spirit" 😂
For the talk about money, yes we're very private but it's more than we don't want to brag about it or rub it in the face of someone that make less
The salary that you earn does not define you as a person or the value that you have (nurses win less than traders but they're high value due to their actions)
And money is a ressource like food, nobody need to know how many food I have in my fridge except if you're cooking with me ^^
I'm glad I'm one of these "peasant mentality" people. Besides a house loan, I've never borrowed any money in my entire life - and I'm in my mid 60's. Even for the cars I've owned: I started as a young driver with an old and small one that my parents left me then. When I had saved enough money I bought a new one, and I've always done so since. The same goes for everything I own, I'd rather save money for some time than pay instalments, thus only paying the net price of what I buy, no extra interest to pay for the loan - more money left for me. Of course, being in Europe, I never had to worry about going into debt on medical expenses or sending my children to college - that helps.
This has been an eye opener. Living in the UK, I still didn't know this about France. Feels like we have picked up a lot of bad habits from the US! Let's hope we get closer to European way of life. Another great video.
The US way of life is in a "great part" based on the UK way of life, the UK has adopted some European traits (With the corresponding high taxes) and the US has adopted some of its own ways like being spendthrift due to an "over reaching" economy!?!
Lived in 9 countries. USA & UK absolute worst. Hated that TV tax. Must be really bad since Brexit.
I agree with what you said! Another reason why Americans have more debt than the French is student loans. As a French person living in the US I am still paying student loans. I would not have those if I had attended a university in France.
Omg, yes. We actually had a section on student loans in the video and a few other things, but it was just getting so long we had to edit. But this is another thing that feel completely out of control in the US and thus requires debt, the cost of education.
i regret every single day going to university in the USA. I'm currently in France right now working towards applying for my master's - which is about 60k+ in the USA for the exact same degree...
The issue with the US is that students are too immature to take out student loans responsibly and that private banks control the system. There are people out there with hundreds of thousands of dollars in student debt when all they have to show for it is a major in English and a job at McDonalds.
In my country of Sweden, the Department of Education runs and operates CSN (The Central Student Aid Board) which decides the amount a student can get. It's divided into two parts: the first part is called "student support" for students who live at home and don't really have very many expenses. You don't need to pay back the student support grant. The second part is called "student loan" for students who have a place of their own where they pay rent, electricity and other things. This loan needs to be paid back with interest.
Currently, the student support is ~$400/month and the student loan is ~$920/month. Total sum for both is ~$1320/month. The 2024 student loan interest is 1,23%.
@@WolfHeathen the student loan interest in the US is higher. Mine is 6.9%.
@@WolfHeathen Well when you are young you dont know any better. I know for me i grew up poor, no guidance from parent, no access to internet, i didnt have a computer until i was 25, so i didnt know any better. But i did paid it off, took 12 years, and not much ability to afford anything else.
Thanks for your videos. It really helps me understand your country. I’ve there as a visitor but not long enough to experience the life of american citizens. I never truly understood the credit cards system. The interest rates are really awful.
In France you apparently choose to have a end of the month payment for your expenses. But you can choose to have your expenses taken from you cash account immediately (that’s what I do because I don’t want to be in debt at the end of the month).
Anyway your videos are wonderful wether you are talking about France or the US.
Same for me here! No debt!
I hate giving my money to a Bank. They already have my money
You don't pay the interest rate on a credit card unless you don't pay the full amount at the end of the month that you spent during the month.
If French are like Poles, many do not move - so they stay in the same town in the same home their whole lives and then the kids inherit it. It means homes get paid off.
French people are known to be curious and travel a lot outside their country. They are not sedentary.
There are credit cards in France. They are distributed by organism like Sofinco or Cetelem instead of banks. From my experience, the spending limit is 3000€. You can either pay up at the end of the month, and this comes with no fees, or go the credit route (19,6%).
Also, we have no credit score, but if you don't pay your debt, you might end up banished by la banque de France.
Your videos always have good info, thanks
The FICO score (Fair, Issac and Company) was invented in 1989. While other forms of credit scoring existed, especially for Business, there was a time not too long ago when we were similar to the French in this matter.
Interesting that you were taught that debt was part of being responsible. I'm 62 and actually I was never taught that. We were taught to pay off the c/c before they incurred interest
I was one of those who was taught about responsible debt & I'm a bit older than you. Anyone who went to University between 1970 and 1990 got a good education in the finance system, the purpose and use of c/c, and the need for a good credit history. I was already getting asked about my credit history in 1978 when I bought my first new car to replace the used one I got with help from my grandparents.
Thank you for the video! You both look great!
Some really interesting points. I also see this in the UK. Everyone needs to have the latest car and the newest iPhone. It’s really messed up.
I really am impressed by the quality of your channel. Your sincerity, your analysis, they reaveal a true intelligence and a rare capacity to see beyond the apparearences. I want, by these words, to congrat you both, for the boldness of your choices and for the trueness of your communication. In fact, it is a high conscienceness path, not theorical, but deeply rooted in the material world, the most difficcult one, because, as your justly put it once in one of your videos, it reveals that we are just idiots when we are extracted of our cultural world, and this is why most of them are prisonners of our social programmation. Now you are free ! I wish your example could inspire as much persons as possible :)
Thank you for your words.
I'm so glad I found yoru channel, it is so informative. Thanks you!
Me as a Belgian and most Europeans don't have credit card. I have a Bank card but that is directly linked my account. So when I make a payment it instantaneously goes of my account and I can not go negative, my choice. A credit card is a debt card and I don't want to accumulate debts.
But Americans are grown up enough to handle the use of a credit card. HAHAHAHAHAHAHAHAHA
Havn't used a credit card in the UK for decades, so had to get one specially when I went to the US.
very enlightening presentation ! thanks. I might consider living there or making a long visit at some point in the future.
What you are beginning to experience is the difference between the post-WWII emphasis on capitol growth (US) vs social protection (Europe).
Most Europeans and British people who live in the usa almost innately understand the reasons. Americans don't get it.
The downside of the french banking system is that fees are very high, it is next to impossible to move your asset from one bank to another if you are unhappy with your current bank, managing fees of investment accounts are outrageous in france.
was the case before, but with "portability" you can now move from bank to bank in a (theoretically speaking) seamless way. Might take a few weeks to get it all sorted out depending on the bank. And fees can be reduced drastically by using an online bank like BoursoBank, Fortuneo, etc.
Really love the non-sensationaliat style of this video. And of course, very interesting content.
also college is very cheap here. Student loan is not a thing. Bravo pour votre contenu. Vous êtes très sympathiques et agréables à suivre.
I wish all American electors had seen this 3 weeks ago :) I think we Brits should also mover closer to the European models on Debt, Credit, Housing and Health Care. Fantastic video . This ageing British Francophile will certainly be checking out your channel.
Because French consume faaaar less than americans !
French people are known for saving money.
You guys are very good at explaining
Hi, nice video but there are a few things missing. As 29 year old french, here's how me and my wife have very little debt in addition to what you said:
- No car payments, we buy vehicles we can afford or we buy used. Sure, I drive a 7 year old Dacia Sandero, but in the end it's just a tool to get me from A to B, it's simple and it works. I feel like americans always want to buy a nice new car on credit to impress their neighbors. In France you see more old cars still running, fewer large shiny SUVs (although this is starting to change too).
- No student debt. The top universities of the country are free, or almost free. I went to the top computer science school and paid 75€ for my engineering degree thanks to my scholarship. Without scholarship it would have been 400€/year which is really not a lot. My wife went to the same school, so no debt.
- Very small housing debt: now this is not true for everyone because many french people buy the biggest home they can afford and just stay in it forever; but we chose to buy a small appartment that's just the right size for us two, we were able to pay more than half of it as a down payment and just owe around 70k, which translates to around 450€ monthly payments. If we have kids, we can rent this one for 900€/month and buy a bigger home.
- No overconsumption debt: In France, people just buy less stuff than in the US. We see fewer ads, we have less money in general, and less access to credit. It's very rare to buy something with money we don't have, unless it's a house... We have this culture of saving before buying.
I used to comment to my American friends that the French buy smaller cars even if they have kids but am shocked to see the increase in SUV sales in France even in cities where they make 0 sense :-( It's sad that many French families are falling in the SUV trap.
@@jplebihan I guess the silver lining is that french SUVs such as the Peugeot 5008 are still tiny compared to american SUVs like the Chevrolet Suburban that you see everywhere over there. 😅
SUV’s are the biggest car segment in Europe with 3M cars sold 2022 data.
25% of cars in my country are 20+ years old, according to stats 80% of new car sales are from companies.fuel is also more expensive and Europe.
There is a credit score in France, it's just not published nor communicated to you, only banks share that kind of information;
Love your videos, this one might be for me the most interesting so far.
Credit cards are a rarity here in Sweden. No sane person would ever get a credit card.
So do you guys mostly have debit cards? I hear Sweden is one of the most cash-less countries in the world.
What about chargeback credit cards? I (living in Germany) do shoping with one and it is paid in full at the end of the month. Keeps fixed expenses separate from variable ones.
One with revolving credit or some shady ways to milk money from me I'd avoid.
Hi, being a dual EU-US citizen, I totally agree with your comparison of the 2 cultures.
You might want to mention consumer credit companies becoming more prevalent in France - such as Cetelem just to name a popular one. Many people use that form of credit now and get into trouble because as a people, we do not have a culture of debt management.
This is interesting. Thank you for adding this perspective and comment!
In France, by law all your credits (house, car, ...) can't exceed a certain % of your salary, but many credit business "forget" to check that ! Then yes some people are catch. in the debts spiral.
@@brigittelacour5055 35 % maximum of your income ... but , yep , some credit agencies will cheat on your income to push the credit line on you.
There's a last " garde-fous " in France = % interest Rate can't exceed le " taux d'usure " by law.
@@brigittelacour5055 30 % ou 33 % de mémoire.
I'm a happy American. I have no debt, including my house. I retired 3 years ago at 50. All my vehicles are over 4 years old and paid off. My phone cost me less than $200 on Amazon. I don't eat out because I think it's gross. I do make a little money restoring classic cars; but I'd do that even without the money. I didn't incur any student loans.
I started an HVAC business (mostly residential) and became my own boss when I was 22 years old after working for someone else for 3 years.
I have an investment income of about $160,000 per year.
For full disclosure, my wife works part time at Costco (because she likes it?!?!?!) after staying home with the two kids for 15 years. They have really good health insurance.
There's nothing wrong with the United States of America. You just have to work hard, be ambitious, and stay out of debt. There is no good debt....there's bad debt and worse debt.
”There is nothing wrong with American” just like people said in Germany in early 1939…. 🤦♂️🤦♀️🤡🤮🤯
@@bokhans yet without the Versailles treaty, war reparations, the gold standard, 10,000% inflation, kristallnacht, nor the great depression, the occupation of Czechoslovakia, nor.......YOU BIG DUMMY.
Crack a book sometime.
As a former Equifax employee I understand the debt on credit in USA. Gladly happy 22 years in France lol !!!
That why Europeans call "the American Dream" " the American Illusion". Life is must better in Europe. Europe works to live, the US live to work.
So why does Europe keep begging for US military protection? They have no money to pay for defense.
The US work to survive……..😂
American dream, because you have to sleep to believe it……
"Live to work." Is that not slavery?
Do this for french people in the future , and in French language 😁 ,to explain to french people , who complains so much , or who Dreams about USA way of life , how lucky they are 😁
@@JeanlucPerez-u3g The dream is to live in France while keeping your professional activity in the US, thus benefiting from a much higher salary. That’s the real lesson. You take advantage of both sides and live in the country where the cost of living is lower. Nothing to criticize, but it’s not comparable to the life of the locals…
we are not lucky in the most communist country in the world sheeeesh wake up! we pay more taxes than in China. Expats from the US dont see that as they pay their taxes in the US.
@@mohakadecincy2413 Yeah.......
My dad is French and watching my French grandparents and friends going about their very relaxed daily life was always a joy.
Nice video and knowledgeable , i use to travel in the US for business but US is now like Switzerland , very high cost country
In Miami , 45 $ a breakfast not really fancy , I asked for a fresh orange juice and the server brought another 15 $ bill
Amazing !!!
Uber was affordable but apart this …
I have seen that average income for a household is 100 k$ a year which is not case in France but with those kind of costs . You need this even more to be equal with France
$5000 deductible and $500 a month for health insurance!?! Wow... $6000 a year gambled on the long odds that I'll get sick?
I have zero bills that large, my mortgage costs less per month...
Absolutely........ UK citizen here.
Six hours in ER with scans, blood tests and blood thinners........ $8,500 +$850 prescription.
Overnight hospital stay with scans, blood tests and an injection for a bad stomach.... $9,700.
Those were two "simple" visits to US healthcare providers.
My "American " daughter's in-laws have to call their insurance company to check which doctor, hospital or pharmacy they can use when visiting as they are "out of state" which incurs extra charges...
It seems that cost of living is lower in europe, mainly because of health insurance. Interest rates are about half compared to USA. Living in Europe is more cost effective, If you have a remote job or a reliable source of income. Because of high standards, their food is healthier and, in most cases, fresher, which translates to healthier living.
america has become the land of corporate greed. My countdown = 16 months- retire to france !!!🎉
In the Netherlands the credit cards are mostly also glorified debet cards, for which at the end of the month the whole expenditure must be paid for. This is a big plus, in my opinion. No piling off debt!
But also, Americans seem to be trained to compulsive consumption from birth
Hi there!! Thank you for this video. Gracias, amigos.
I wished you did more videos where you actually visit the country, see the markets, villages, landscape...
Good points. A big difference when it comes to housing debt is that mortgages are very unusual in France. When you buy a home, you take a regular loan that is not backed by an asset. Of course, in practice the bank will still end up forcing the sale of your house if you cannot repay the loan. But that still makes a big difference: the loan on your home is meant to be repaid in full in 20 to 30 years (as opposed to only paying interests and jumping from one mortgage to the next), and since the loan on your home is not a mortgage, you cannot release equity/borrow more when the value of your house has increased. This means that you are not pushed to take on financial leverage and roll debt during your entire life.
On a more systemic level though, I tend to like the American approach. The appetite of Americans for debt and financial leverage also reflects certain priorities (less aversion to risk, a higher dose of optimism, a more forward-looking mindset... - these are not bad things, they also make for a more mobile, dynamic society).
How common/frequent is it in France for people to move from one part of the country to another?
@@mikebarnes2294 You are pointing out another thing that Europeans do NOT understand. In France the average person works for 3 companies in their lifetime, while in the USA the average is 12 companies. As a result almost all French workers rarely if ever move, while in the USA an employee has to move hundreds or thousands of kilometers every 4.5 years, requiring them to buy & sell a home or pay exorbitant rents. these alone requires some sort of housing debt being changed every 4.5 years.
It’s not easy to fire an employee in France. In the US it can happen for any reason or no reason and at anytime so a letter about an American’s job is worthless.
Just an FYI for all of you across the pond. In 28 of the 50 states in the USA have working class people who are AGAINST worker’s rights. They have voted to make their areas so-called “right-to-work” laws. These basically prohibit or at least hamstring any organized labor activity. These same states are the ones that impose the restrictions that make the news in the rest of the world regarding women's rights. There is little likelihood that these will change in the next fifty years.
Yup the "right to work" states ( many Republican states).
I worked in Idaho and during a merger in a small company a young female manager came in and fired me because I refused to fire some of my staff while she kept her staff. Well I left and wrote to the head office and they fired her!!!
@ you are correct. They vote against their own best interests thinking that by doing so they will become millionaires….delusional thinking.
Oh la la! Il s'agit de faire gaffe! 😮
Credit is not run by predetors in France. Americans take on debt to pay their debt, then wonder why their debt keeps getting higher.
Your credit card discussion is only partly true. You can ask (and it usually comes by default like that) for the money to be taken from your account immediately. What you're describing sounds like "carte de crédit à débit différé", where the money would leave your account on a specific date each month. You can also ask for "carte de crédit à débit immédiat" and the money gets removed under two-three days. It's also possible (at least in my bank) to switch between the two rather easily, maybe it's just a flip of a switch in my bank app or sth like this.
It is a huge cultural difference. there is a reason why US has the biggest and most profitable banks in the world. the money has to come from somewhere. somehow they managed to convice/force the US people to hand over the dollars to the banks.
there is no score in france but a legel limit of 33% of your income that is going into debt reimbursment. and the bank are not allowed to lend money over that limit
Having moved from France back to the US in 2006, we had no credit history in the US so we had to get a special debit card with a ceiling that corresponded to the amount that we had placed in an immobilized account. What was especially infuriating was that the correspondence that we would receive from the bank was usually only in Spanish.
The notion that a private company should determine your risk profile based on purely confidential and proprietary criteria is pure insanity in my opinion.
Ah, the USA ultra-crony capitalism - you have to love our constant ways of inventing ever more intrusive ways to make "free" people act like indentured servants.
I'm in the Netherlands. I do have a credit card, but I only use it in case of emergency, I.E. when I absolutely don't have any other way to pay for something (for travels, mostly).
I was raised with the idea of "If you can't afford it, you shouldn't buy it"
I grew up in Paris, and live in the US. I still will pay more for better groceries, have a small wardrobe, and paid off our houses in 15 years. ( houses- one is for our business office and one to live in). On a lower middle class income. Before Medicare, we were paying $1400 each a month in insurance through my company. French healthcare is excellent. My family still lives there
Great video! Ive been in Spain for 12 years now and it's the same deal as in France. I wouldnt trade it, I'd probably do really well moving back to the US but i enjoy the peace of mind living in Spain. Dont use a credit card here either.
I just signed upbto work with a mindset coach due to my fear of selling my home while planning to move to France.
Your video helped me tremendously toward my ties to something, as you say the bank owns and not me. 😊
Great video as always. Very interesting to learn about this debt culture in the US. Very different as you said from what we are used to in France.
I would like to make a clarification though. If I'm not mistaken, credit cards like the ones you have in the US do exist in France. They're not the main payment mean banks offer but you can find many companies providing them (for example, the "Carte PASS" from Carrefour). Generally these credit cards allow you to choose either a direct payment in full or a credit payment that you reimburse monthly with interests. And, indeed, as you said in the video, banks generally offer debit cards instead, but not all of them are "delayed debit" cards. I think most of them are in fact "immediate debit" and you have to opt in for delayed debits.
I enjoy your videos. I immigrated to Switzerland 8 years ago. What is so interesting is the mixture of similarities and differences between France and Switzerland. Mostly home ownership is much lower in Switzerland than in either France or the USA. Moreover, Swiss homeowners tend to carry mortgage debt a long time and even refinance to keep a mortgage. Interest rates here have been low for decades (how does 0.5% sound to you). In addition, homeowners calculate and imputed rental income on a home, which is reported-and taxed-on their income tax returns.
I can relate... being from Belgium and moved to Canada I was shocked by the credit score system and how easy it is to contract debt... My Canadian wife at the time had no job and could go to a car dealership and leave with a car the same day without paying anything!!! I've never seen something like that before... Same for the never ending re-finincing of houses... I was thinking: "So... you guys never own your house ?!" ... So many things seemed messed up here in Canada. It is so interesting to understand both systems and "cultures"; and use the system at our advantage while being well informed (and absolutely not subscribe to the "keep up with the Joneses" mentality in North America... when I see how people live here, the car they drive and the median salary... I know everybody is deep in debt for sure :) )
We had the same experience going from Belgium to USA 😂😂
I could not live in the USA. The health insurance issue would be one that would keep me awake nights and in a constant state of panic. As someone who worked their entire life and was able, through a lifetime of prudence to retire at 57, I was diagnosed with lung cancer after a lifetime of no smoking or drinking at 60. Supposing I could have retired in the first place, would I be filing for bankruptcy to pay my medical bills? It would seem a high price to pay.
No, we don't let most of our folks with serious illnesses get help, many of them lose out. There is no safety-net, just VERY hard reality of tough luck & hard work or you get run over by USA ultra-capitalism. The USA can be a very cruel place where you survive or not. Those who are unlucky or too weak get caught in our social Darwinism. Why do you think we call it a healthcare INDUSTRY.
You'd have been fine for the last 14 years, with the Affordable Care Act; I had $300,000 in claims but my insurance paid for all of it. It is more expensive. If you could make to 65, you get mostly free health care through the Medicare program, and it's very similar to the French system. If you're under 65, the new president will repeal the Care Act and yes, you'd be looking at bankruptcy. I don't like it. But at least millions of people who voted for him will lose their coverage and go bankrupt, too. And I'm going to laugh and laugh at them. It's all I got.
I moved to Germany in 2008, when there were no credit cards in the country.
On one side, it's true that German banking is obsolete, but on the other side, the government simply precented Visa and Master Card from running Germans into debt.
The average European's life style is way, way more frugal than an American one. Although things changed a lot over the last 25 years, still, there is no comparison.
A European earns 1000 and spends 850 each month
An American earns 1000 and spends 1700 each month
My biggest regret last year when I sold my house was turning right around and buying another one right away. I do own my house outright, but I am burdened with taxes, insurance, maintenance, and so many other things that it's pretty expensive even with no house payment. I am ready to sell and bounce out of this situation. I would love to be in France.
Le système français oblige plus à vivre suivant ses moyens que suivant ses envies ou ses tocades... Merci pour cette vidéo édifiante !👍
They also have socialized healthcare and don't have to pay any money for this, which eliminates a huge worry and expenditure for them.
Technically in France, if you are bad at honouring your debt, you can be filed at the Banque de France.
This can be an obstacle to take a loan with good interest rates (but not a job^^) for the next 10 years (afterwards the "droit à l'oubli" erases your debt history).
Note that if you are drowning in debt, you can ask for a "demande de surendettement" so the state erases your debts: a citizen with a clean slate and a second chance is a better economic actor than a citizen that made a mistake once and is stuck in a vicious circle.
In Europe we have both credit cards and debit cards. Debit cards, we use in stores, and the money comes directly from your account. Credit cards, you use for online shopping (but not, generally, as a "loan"). You can use your debit card online as well, but it doesn't have the same protections, and you don't always want online stores to have the ability to withdraw directly from your "cash" account.
Mr Money Mustache does a great job of explaining to Americans how not to get sucked into excessive debt, and indeed to actually make a profit.
There are also credit cards in France, very much like the ones we use here in the US, but they are far less commonly used.
While linvin in the US we paid our credit card balance in full each month. After a year we got a call and they offered a gold card, at an extra fee. We asked why we would do that. Well, so that we could buy more. But we always saved for stuff, so we said we do not need it. She was astonished..
In America, there are only private debts, while in France, it’s all about public debts… or wait a second-actually, in America, there are massive private debts and massive public debts!
How did you get that 40% number tho ? Because you can double French salaries to know what the company actually pays, a lot gets taken out automatically (no opting out) for retirement, healthcare, unemployment insurance, etc.... Which isn't considered "incomes" (no tax). Someone earning 40K before taxes in France is actually being payed 80k by the company. Something everyone seems to be forgetting when comparing to the US, French included !
On another note there is a commonly held principle in France that the only loan you should ever take is a mortgage. We do have things like revolving credits, etc... But they are seen as something for the financially illiterate. Even car loans are frowned upon in most case....
You are right, even car loans are frowned upon. I have taken one anyway as I managed to pay 0.5% interest rate (as it is an EV) even if I could pay the car cash. It is better to have a 0.5% loan and use my cash to buy ETF on my PEA.
It wozld be interesting to compare the income and tax.
Not only what they aum up to, but what is payed with it that otherwise has to be bought privately (healthcare, education, ...)!
I'm french and really enjoy your vidéos. healthcare of the french system is rather a good system. However it's better to subscribe a "mutuelle" to cover expanses that are not taken care by the Healthcare french Social Security. For exemple: if you need to be hospitalised some of the charges still charged and not re imbursed . Therefore the Mutuelle's suscriptions are not as expensive as it could be it the USA. Can go from 50 to 160 euros per month (average) and covers many things. It's covering some of the Dental, ophtamilogist, extra costs at the hôpital. etc.
Good video! Lived in Europe for 35 years, worked in France even, but this video applies to most European countries. In America, we live on debt because banks have convinced us that "debt is good", like DeBeers Mines convinces you that a big diamond proves you love your girlfriend/wife. Europeans do not buy the things we in America seem to have to have. In Europe, college is mostly free, you inherit your house half the time, you buy a car you can afford (lots of safe, no-scam used cars around, and consumer laws are much tougher here). Personal bank relationship is practically essential, and we have had ours for 25 years, through 3 bank mergers ... yes, taxes are high but now much compensation comes in company bennies and pay bonus', which are taxed at a lower rate. You get unbelievable low/no cost health care, unemployment (if it happens) and other social benefits. Large companies often provide a company car, on-site commissary and company meals, free holiday venues and even subsidized housing and/or low-interest loans. Europeans in general have less volatility in their employment and better job security, which reduces debt-inducing stints of unemployment and stressful job searches, and fewer costly relocations for job change or for "moving up". But, in the end, people in Europe just seem to need less consumer goods, ... they value quality of life over that next dollar ...
I'm America and we, my husband and myself, our only debt is our house. We don't buy into the "CHARGE IT" culture. We don't have credit cards. We do have vehicles & a camper that are paid off. Our next task it to pay off our mortgage! Not every American buys into debt. There are some weird folks like us! We definitely don't want to retire with a mortgage payment! Thusly we are going to pay that off!