What America's Average Take-Home Pay Looks Like Compared to Other Countries

iStock
iStock

When you look at how much money people make around the world, salaries can only show part of the picture. In practically every country, workers give up a chunk of their paycheck to the government. So after taxes, which citizens get to hold onto the biggest slice of their pie? These graphics from the company relocation program CapRelo lay it out, analyzing what people making the average wage in a number of countries can expect to pay in taxes each year.

A map of the percentage of the average wage in each country that goes toward taxes
CapRelo

The countries with the highest tax rates in the world can all be found in Europe. In Belgium, workers give up 45 percent of the average wage, while in Sweden, they pay 52 percent, and in Denmark, they pay 56 percent. But not every nation on the continent follows this trend. In Switzerland, employees making the average wage pay just 2 percent in taxes, one of the lowest rates in the world. The only citizens that pay less are in India and Saudi Arabia, where the tax rates are 0 percent.

Lower taxes don't necessarily equal bigger paychecks. Though Denmark pays the most taxes, the average take-home salary ($28,227) is still higher than it is in Saudi Arabia ($21,720) and India ($1,670). But workers in Switzerland enjoy the biggest wages after taxes by far, with an average take-home salary of $84,006. The runner-up is the U.S., with an average take-home salary of $52,344.

A graph showing average salaries versus take-home pay
CapRelo

Of course, these figures don't take the cost of living into account. Citizens paying less in taxes are often forced to spend that money on benefits they would receive from the government in other countries. In Switzerland, for example, you have to pay to drive on motorways, while in the U.S., most highways are maintained using government funds. Meanwhile, the U.S. is one of the few developed nations that doesn't offer universal healthcare. And while Swedes may pay a lot in taxes, thanks to generous government subsidies, they also pay some of the world's lowest rates for childcare. So make sure you consider all the factors before picking a new place to live based on tax rate.

[h/t CapRelo]

Determined to Save Money This Year? Try the App That Invests Your Spare Change Automatically

iStock.com/PeopleImages
iStock.com/PeopleImages

If you just started getting into the habit of putting money into a savings account, the thought of investing that cash can feel intimidating. But investing a tiny bit is often better than not investing at all, even if you only have literal pennies to spare. That's the idea behind Acorns, an investment app that invests your spare change automatically without you having to think about it, according to NerdWallet.

To use it, you link your debit or credit cards to your Acorns account. The app then keeps track of every purchase you make, and with your permission, it rounds up those transactions to the nearest dollar, transferring that spare change to an Acorns investment portfolio.

These individual investments are almost too small to notice, and that's the point. Instead of investing an intimidating portion of your savings all at once, you invest small amounts that add up over time—hopefully making your money back and then some, with little risk or effort on your part. Acorns also gives you the option to choose how risky you want to be with your investments, with levels ranging from conservative to aggressive.

If you ever decide you're ready to start investing more than a few cents at a time, Acorns allows you to transfer larger amounts of money into your investment account, too, as long as it's more than $5. And if you ever feel like you're letting go of too much, you can shut off the automatic feature and choose which transactions to round up and invest manually.

To sign up for the service, you have to be willing to put down a little more than pocket change. Investing in one of its pre-built portfolios requires a minimum balance of $5. On top of that, you need to pay $1 a month for a taxable investment account, $2 a month for an IRA account, or $3 a month for both types of investment accounts and an Acorns checking account. (College students with a functioning .edu email address are eligible to try the taxable investment service free for four years.)

Now that your investments are taken care of, check out these other apps that can make being an adult less stressful.

[h/t NerdWallet]

If You Can Save $500 a Month Toward Retirement, Here's How Much You'll End Up With

iStock.com/BrianAJackson
iStock.com/BrianAJackson

You don’t need to be a master money strategist to know that setting aside funds for your eventual retirement is a necessity. While it might be tempting to keep cash in your pocket now and assume the Social Security benefits that will kick in later will keep you afloat, the reality is that many people won’t receive enough livable income from that government program, especially with the mounting medical bills that advanced age can bring.

Unless you plan on working a full- or part-time job indefinitely, saving now will provide you with a far more comfortable third act in life. If you’re wondering how, CNBC recently broke out their retirement savings calculator to estimate what the average person can expect to end up with at age 67 if they set a goal of saving $500 per month.

At 25 years old and calculating a four percent rate of return, a retiree would have $628,918 in the bank. At six percent, it would be $1,055,703.

Obviously, the earlier you start to save, the better. But it’s never too late. If you begin saving at age 30, you’ll have $490,213 accrued at a four percent rate of return, or $763,609 at six percent. Starting at age 40 will net you $282,505 at four percent. Starting at age 50 is predictably less rewarding: at four percent interest, you’ll have $142,185.

Most people can, of course, do these back-of-napkin estimates themselves using amounts better suited to their own specific situations. Even saving as little as $200 a month early in life might make the difference between enjoying your retirement without obligation or clocking in for part-time work. 

[h/t CNBC]

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