In Discussions, Foreign, Money

North American versus European Approaches to Debt and Saving

Pauline wrote a great post called: The French Approach to Debt, and being with someone who is from France (and who has worked all over Europe) who has lived in the U.S. with me as well as in Canada for over 10 years now, I have a LOT of insight into this subject.

Pauline’s points in brief:

  1. Student loans are rare
  2. No car loans because they use public transportation
  3. No credit cards because their ‘credit card’ is really a debit card
  4. Few store credit cards and very little access to free, easy credit
  5. Loans are rarely given out and are given under very strict rules
  6. Only debt is their mortgage

Other points I want to add  to her post are the following:

STUDENT LOANS ARE RARE IN FRANCE BECAUSE…

1. THEY ARE REALISTIC ABOUT THEIR ABILITIES AND CAPABILITIES

In North America, everyone expects everyone to get a college degree, no ifs, ands or buts about it.

This causes a lot of problems because it has spawned a whole industry of what I like to call fake colleges that basically take your money and give you very little (sometimes negative) value in return.

At the end, you graduate with student debt, and with a piece of paper not even worth the ink it is printed on in terms of having any value in the job market.

As a result of this attitude, people here in North America are willing to invest in their education at any cost even if it kills them financially.

Former Secretary of Education (in the U.S.) states that only 150 of 3500 U.S. colleges are worth the investment. 

(Source)

This is going to sound harsh but it is unrealistic to expect that everyone will be able to obtain a college degree worth the investment, and the French recognize this more than we do.

In North America, no one wants to believe or accept that they cannot make it or aren’t smart enough — in fact that’s the backbone of being a North American, that you don’t need to have connections or money to become successful and rich, however in the same vein, it is also to our detriment.

The French seem to have less of a hang-up than we do about not being smart or having to prove that they are smart by waving around a piece of paper (no matter how useless), and accept it if that’s the truth because that’s just the way their culture and society works.


2. THEY ARE FILTERED OUT AT AN EARLY AGE BASED ON APTITUDE

At a young age (I believe 15 was the age given to me), they filter out children who do not seem to have the inclination or aptitude to go on to the higher education, and we know quite a few people who were basically streamed into trade schools or were told they were to no longer continue their high school studies because their marks from their previous years were far too low to warrant the government paying for them to go to school for another year.

If you manage to prove to the authorities that you have the brains to stay in school and reach a higher level of education, they put in more filters as you go up where you have to compete with other students to obtain what they call ‘prep schools’ to prepare to enter the best colleges in France which are typically business or engineering schools.

Travel-Photograph-Lyon-France-Landscape

Those schools are also ranked, and depending on what school you get, it determines your entire career path and the rankings change based on government approvals from year to year.

One year, your school could be considered a first-rank school but if you fail to update and modernize your teaching practices, you could drop to second-rank or third-rank.

As an example, someone who went to L’École Polytechnique in France for engineering, has the pick of any job in any industry that they want, and generally speaking they end up at the uppermost echelons of executives in France.

That is not to say by any stretch of the imagination that just because they went to L’École Polytechnique that they’re fit for the job (they could truly suck at it), but that is the way it works in France.

On the rare occasion you will meet someone who did not go to THE BEST school, but who still made it fairly high up in the ranks, but you know immediately based on their degree that he or she will never become the boss no matter how hard they work.

This is both fair and unfair, but it’s how it works.

As a result, there are still colleges in France where you can pay and obtain a degree, but they are not as prevalent as in North America, and everyone in France knows by the name of the school that you paid for the degree.

FRENCH PEOPLE DON’T SPEND WHAT THEY DO NOT HAVE

Generally speaking as Pauline pointed out, French people do not spend what they don’t have because they can’t, but also she was too modest in not pointing out that it is also not part of their culture.

They do not spend what they do not have. This is something I’ve really noticed as a prevalent attitude.

If you do not have enough money to buy meat, you just don’t buy any meat and turn vegetarian. Simple as that.

No money for wine? You don’t drink the good stuff, you drink decent stuff at 10 EUR a bottle.

Christmas-Feast-2013-Pouilly-Fuisse-Deglazing-Bacon-Wine-Tartiflette-France-Food

They do not consider those things as essentials because they see the priority is that they are fed, and anything above being fed and full or with good one is an extra bonus.

That’s a rather extreme example, but quite true because they are (as true to form) picky about what kind of food they eat, and would rather not eat meat 90% of the time than to eat flavourless meat 100% of the time, as in meat that is not well-raised and tasty.

THE FRENCH DO NOT EXPECT TO BE GIVEN ANYTHING WITHOUT WORKING FOR IT

When I was about to turn 16, the biggest fuss in my age group was obtaining that coveted driver’s license, and then being able to drive a car (your parents’ car or one that they buy / give to you) to get around and be independent.

Sixteen-year old French children do not have this expectation of getting a license, then a car and being ‘free’ from having to be chauffeured around by their parents.

In many ways they are already ‘free’ and independent, probably having gone to school by metro on their own at a very young age, and never having relied on their parents to bring them anywhere to begin with, so they don’t have that hang-up.

I will acknowledge however that public transportation is much better in France than in North America, so a lot of people don’t even feel the need for a car (what a hassle!), whereas in North America if you don’t have a car, you’re kind of screwed because everyone and everything is so spread out.

Plus, their cars and roads in Europe are uber tiny. It’s the reason why they come to North America and marvel at our highways and huge honkin’ gas-guzzlers.

Basically, no one expects to drive a car or own a home at any age until they are able to afford one.

THERE IS LESS OF A NEED TO SHOW OFF

Compared to North America and in China, there’s less of a need to show off that you’re rich and successful.

If you were rich and successful, they reason, you don’t need to even prove that you are and therefore wouldn’t bother.

They even find it a bit disdainful to be a showoff, and generally don’t feel the need to have clothing or things in excess the way we do.

They like quality over quantity at all social classes, and although they do have H&M and other cheap shops for clothing there, if they could save their money and afford something better, they’re more likely to do so than to gorge on cheap goods.

Besides, I am told just by the way you talk, the clothes you wear, the way you mention certain restaurants or areas you vacation at, or even the way you eat, people can tell what social class and status you came from… and of course, the school you went to determines what kind of job you have, so you simply need to only mention the school to have people immediately know (generally) what job you have and what you make.

Your actions give it all away.

THE FRENCH ARE HEAVILY TAXED BUT THEY DO NOT HAVE TO WORRY ABOUT MUCH

This is changing as the years go by ever since the recession hit, but generally speaking in the past, as a French citizen you did not have to worry (much) about:

  • Healthcare
  • Daycare
  • Retirement
  • Unemployment
  • Schooling

They are some of the most taxed folks in the world, the French, with tax rates going up to 70% or higher, but this is because the government is supposed to provide everything for them.

(Actually if the French were more organized and efficient, they would have a much better system that is totally debt-free like the Germans, but alas… they are a bit too soft-hearted / socialist for that).

Travel-Photograph-Lyon-France-Countryside

Anyway, in brief here are the points I understood about the French government versus the North American one:

HEALTHCARE

Universal healthcare. France and Canada has this, the U.S. does not.

France’s healthcare is far superior to the Canadian one, but I am happy to have any universal healthcare.

Having lived in the U.S. for a brief period and having American family members, I am appalled by what is considered normal and acceptable there by Americans.

Sure, Americans don’t get taxed as much as the French or the Canadians, but they sure get screwed in other ways.

Everyone complains about this as being a problem in the U.S. which is why Obamacare was such a hot topic, but I don’t think people realize just how horrible of a problem it is in the U.S. compared to other First World countries.


The fact that an ambulance can cost up to $1000 versus $300 in Canada, or that people actually beg to be released out of hospitals early because they simply cannot pay the bill to be able to stay in said hospital to recover from major surgery, is mind boggling to me as a Canadian.

That it can cost over $100,000 for a medical problem in the U.S., or that they can legally charge gouge $85 for tweezers and $20 for a box of tissues in a hospital, is mind boggling.

If I were still living in the U.S., private health insurance (basic) as a freelancer would have run anywhere from $1000 – $2000 net a month, and taking into account that U.S. minimum wage is $7.25 USD an hour, or $14,500 USD a year, you can’t even make enough money after taxes to pay for basic healthcare.

Even the minimum wage in Canada is $11 CAD an hour, or $22,000 CAD a year, and we have basic healthcare that costs us about $500 a year (per tax-paying citizen).

This is why many people (even those who make triple minimum wage), don’t even have healthcare because they simply can’t afford it, and this is also true for many people who are freelancers!

Even though some freelancers make a very good wage, a lot of them have ultimately told me that they went back to working for a company because the cost of healthcare was far too high and it was a better deal working for an employer than to work for themselves.

Again, this is one of the reasons why I left.

DAYCARE

Daycare is free in France, but it is not free in Canada or the U.S.

Aside from the fact that you can’t even get decent, basic universal healthcare for your family for a reasonable price, if you do happen to have children, you have to pay for daycare.

In Canada, it’s not that bad depending on where you live, ranging from $140 (Quebec) to $1200 (Vancouver) a month, per child. (Source)

Again, we take home more money after taxes, but we’re spending it on things like daycare.

RETIREMENT

Your retirement is supposed to be guaranteed in France at a certain rate based on how many years you worked and so on; many French consider this retirement plan unsustainable because there are not enough young people working, people are living longer and longer, the euro came in and really screwed with everything in terms of inflating cost of living, and so on, but for now, they have a plan in place.

Travel-Photograph-Lyon-France-Hill

Canada has somewhat similar programs (far less generous, of course) that doesn’t allow very low income earners to fall through the cracks by the time it comes to retire even though it puts a greater burden on those of us who have earned a lot to provide for those who couldn’t or didn’t want to work as much.

Still, the money given by Canada to provide for your retirement if you do not have enough saved on your own is still not enough, but it is not a big fat zero.

The U.S.? Totally screwed.

If you couldn’t make enough money to save to retire, you can’t retire.

This is the case of my American family members who are still working at 76 and only have $40,000 saved for retirement, so they cannot afford to retire.

Again, they take home more money after taxes, but have to also save for their own retirement, on top of paying for healthcare at exorbitant costs and daycare if they choose to procreate.

UNEMPLOYMENT

France takes the cake on this one again.

It is very hard to fire someone in France without just cause and you literally need to gather solid proof and evidence that can be brought to a judge to fire someone or risk being sued, and just hearing the fights between employers and employees to get incompetent workers fired is sometimes cause for great disbelief and laughter in our household.

This is also why the French find it very difficult to find jobs once they are unemployed because no company wants to really take the risk of hiring you only to know that they will have to pay to fire you if you don’t work out.

Travel-Photograph-Paris-France-Business-District-Square

In France, many companies have a slush fund specifically set aside to pay out severance to workers they want to fire, because by law they have to not only give you a GOOD reason to fire you, they have to give you something when you leave, and it can even be up to 2 years pay or more.

The higher up you rise in the ranks, the more money you get. This is also another reason why they have such strict hiring practices based on the education you received and the school you went to because if they just promote anyone up into the ranks and discover that they are awful managers, they will have to pay dearly to fire them.

In Canada, you get at least 2 weeks of severance by law, no matter how long you worked or didn’t work.

In the U.S., in some parts you have something called ‘at-will employment’ which totally shocked me. It basically means that an employer can fire you at any time without any severance pay, based on very pithy reasons like not liking the way your hair looks, or they don’t like what colour of shoes you wore that day.

Of course you can always legitimately fight that they fired you because of race, sex, ethnicity and so on, but generally speaking ‘at-will employment’ in states that allow it, requires no reason to fire you.

This will be shocking to hear for many Europeans (heck, even Canadians), but true.

SCHOOLING

As Pauline mentioned, school is reasonably priced and you don’t REALLY go into debt for it unless you go to a school where you pay for the degree.

Not all schools that you pay for are bad.

I am told there is a business school for uber rich kids who weren’t smart enough to make it into the top business schools by their brains alone, and it is quite well respected even though it is a school you pay for.

This school is very expensive (I think I was told something along the lines of $100,000 a year), and wealthy families are happy to pay the tuition for these main reasons:

  • You get to send your kid to mix with other rich kids to find their husbands/wives
  • It is still a good school because they have the money to pay for good teachers
  • These kids will end up working for their families or use family connections to get good jobs

The downside is that if you are not from a rich family and you take on immense amounts of debt to attend said school, they have their own social circles and no matter how good of a friend you are, you are not likely to ever penetrate into their inner society, so it’s kind of a waste of money for anyone who is not filthy rich.

Anyway, the price of school is reasonable in France because they have already filtered out the kids who can’t make it by the age of 16 (or they filter themselves out), and no one is going to spend 2 years of their life studying and prepping for a school that they have no hope in hell of ever entering based on the kids they have to compete against.

The French are, as I mentioned above, way more realistic about their abilities as a culture, and are not going to try for something that is so obviously out of their reach.

Canada, is not so bad.

Our tuition I think is around $7000 CAD a year now (even cheaper in Quebec at around $5000 CAD a year I believe as it is subsidized for Quebec citizens!), which is a far cry from the average $20,000 USD a year it costs in the U.S. for a similar school.

Obviously if you go to an Ivy League school, it is much more expensive than that.

I was talking to a bunch of American kids out of college one time and when I was moaning about the cost of my tuition, they all gave me looks of disgust and said: THAT IS SO CHEAP. We paid 5 times that!

Oops. Hit a sore note.

LOANS ARE NOT EASILY AVAILABLE OR GIVEN

French banks are very, VERY conservative. They will not give you money for new businesses, loans or credit cards because they are not interested in losing their money.

This is both good and bad — without new businesses, innovations and of course, failures, you cannot have great successes like in the U.S., yet by its virtue, it limits any kind of risk where people gorge on cheap credit like we do in North America and buy homes that we cannot afford.

Travel-Photograph-Paris-France-Near-Montmartre-Apartments-Homes-Building

In Canada alone, the current housing bubble scares me in cities like Toronto and Vancouver.

Paying $600,000 – $800,000 for a house that is considered a ‘crappy starter home’ in the U.S., is the norm in Toronto (I watch a lot of HGTV and read a lot of PF blogs).

This is where the U.S. beats both France and Canada hands down in my opinion.

In the U.S., for $150,000 you can get a decent home in a mid-sized city.

With $300,000 you’re living like a queen.

We do not have this in Canada, and in France especially after the euro, it is now far too expensive to really purchase a home at a young age. As a result, they don’t expect to own a home and can rent for life or buy something they can actually afford!!!

FRENCH SAVINGS RATES ARE SOME OF THE HIGHEST IN THE WORLD

In spite of being taxed up the wazoo, they save a heck of a lot of money at 15.8%. Probably out of fear (there is no access to easy credit), and out of a cultural need to do so.

French people tend not to spend every penny that they have on trinkets and enjoying life (YOLO! FOMO!) the way that we do.

We are pretty pathetic in terms of our savings rates in Canada (4.3%) and the U.S. (4%) compared to France (15.8%).

The one area of the world that totally annihilates French rates of saving (relative to income) is China (38%) and India (34.7%).

Anyway, those are the points I wanted to elaborate on based on Pauline’s post.

HAVE YOU EVER THOUGHT ABOUT GLOBAL ATTITUDES TOWARDS DEBT AND SAVINGS?

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Sherry of Save. Spend. Splurge.

Am my own Sugar Daddy. Am a millionaire at 36 after getting out of $60K of student debt in 18 months, a little over a decade earlier, using TheBudgetingTool.com. I have worked 50% of my career (taking 1-2 year breaks), and quadrupled my income within 2 years of graduating, going from $65K to $260K with an average lifetime savings rate of 50%. I have 11 side incomes that are on track in 2020 to make me $50K - $75K. I could retire today if I wanted, but love my work-life balance as a freelancing consultant in STEM (Science, Technology, Engineering, Math). I am all about balance - between time and money, and also enjoying my money. I also post daily on Instagram @saverspender.

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Posted on October 25, 2017

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40 Comments

  1. Tunisia

    So glad I decided to stick through the entirety of this post. I’ve always considered moving countries in the future (especially if I have children) and here is even more reason for me to continue the thought. Here’s to hoping I’ll be able to study abroad a time or two to get somewhat familiar with the areas.

    Reply
    1. save. spend. splurge.

      Well never say never. I’ve lived abroad and it is not perfect in any country by any means, but some countries fit other people better, if that makes sense.

      Reply
  2. LAL

    The problem with tracking so early with schooling is that kids who blossom late don’t get the same chances. I say that because my DH is a late bloomer who barely made it into university in canada. Thankfully he wasn’t pigeonholed into something else because his parents didn’t care about anything.

    Otherwise I agree about savings and debt.

    Reply
    1. save. spend. splurge.

      Europe is extreme in that sense (early on) but I can see the good in both approaches — tracking and not.

      Someone who was tracked out early could still make it, but the road is a lot harder.

      Reply
  3. anonymous

    My dad didnt have a lot of patience so he woukd get frustrated and give up, then he would hit me… my mom worked alot because he ws a deadbeat and while I was an ok student, math is my weak subject. With the encouragement of my bf I’ve brought up my math to the intermediate level. Next quarter ill go to college algebra. So you see if I hadn’t lived in the U.S. I would be hopeless so it hurt when you wrote that. I have a chance in America that I wouldn’t have anywhere else.

    Its hard to learn a subject when your father hits you if you dont get it in five min and your mom is too tired from work to help. Math was always a struggle until recently, My bf will take as long as he needs to explain a math problem. At first when he started tutoring me I was slow but no Im fast thanks to him. He has the patience of a saint.

    Reply
    1. Mary

      Congratulations to you and to your patient bf!!
      Don’t stop believing in yourself.
      I wish you all the best in the future.

      Reply
      1. Anonymous

        @Mary: Thank you Mary, you’re so sweet! I wish you the best also. 😉

        Reply
  4. Pauline

    Thanks for the spotlight!
    About your first point, we do have bad private schools where students who aren’t able to get into a good public one go, but generally fully funded by the bank of Mum and Dad.
    In high school they are called “boites a bac” to help you pass the “bac” high school exam, and you will see the troubled kids who have been kicked out of public schools and are 2-3 years behind.
    Same for some low level business schools that will cater for students who weren’t able to pass the test to get into a major business school.
    Unlike the US, cheap public universities are the best, around $2,000 per year and free on scholarships if you are too poor to pay, then only a few business and engineering schools offer expensive elitist programs. You go to public university for a law or med degree.
    The ranking thing is a bit complicated as it considers the number of teachers per student, square meters per student, computers per student, etc. that you can just buy your way into. They also factor the mandatory months of studying abroad or working an internship, which is a good thing, but many factors you can simply buy. And it is easier to buy in when you are an expensive private school, that is why only a few public school programs (like Dauphine’s master in business) make it to the ranks of business schools.
    And yes there are a few super expensive schools for extremely rich kids, like the American University of Paris at 30,000 euros a year for undergrad, but it is full of foreigners, a lot from the Middle East or China, who want to study in Paris without having to learn the language, so they study in English. You still find a lot of “legacies” from good families in the best business schools and like you said, from their last name, how they dress, speak and where their parents live, you can easily spot husband material it that is what you are into.

    Reply
    1. save. spend. splurge.

      This bac seems to be a big deal, as far as BF told me. Some of his family members couldn’t even complete the bac because they took German and tried to do a science major to get the bac!!

      This school ranking business fascinates me because we don’t have anything like that here other than what we release as rankings each year, but they aren’t certified or “known” as being first-level, second-level, etc.

      I also find it very interesting that you can tell a person’s social status by their behaviour and dress. We don’t really have that here, not to that extent!

      Reply
  5. Tania

    That was so interesting! Thank you, I love hearing about how different cultures and government do life.

    I looked at the American university list and don’t agree. I attended University of Hawaii at Manoa and current resident (in state) tuition/dorm, etc. is well below the amount stated on that table. They may be including housing and food but I don’t think that’s a fair inclusion because you need housing and food regardless of whether you are going to school or not. Even so, at the $91K they are stating, I graduated in accounting, became a CPA and my current market rate in an urban environment is ~$90K to $100K per year. Many students that attend UH are also from that island and live at home with their families. It is also easy to catch public transportation and find a job you can do while in school in Honolulu. So, depending on what you major in and what you do with it when you get out, it’s worth the investment. But as an exercise, it is a good one for potential students to consider when deciding on whether or not to take out student loans.

    If I had not gotten that degree, which helped get my work experience after graduating, I might only make about $35K which doesn’t go far in Hawaii so I think my ROI is much higher than what the table shows (although UHM did score positive).

    I also didn’t like that the “top” of the list only featured very expensive top tier schools. You can be successful in the US without attending a top tier school and I think that sends the wrong message again when it comes to student loan debt. Attending an in state public school as a resident in a field of study that has a good ROI and working your way through school will go farther to keep the debt needs down.

    Reply
    1. save. spend. splurge.

      I guess they assume kids are staying with theirs parents while going to school?

      I myself got a decent job coming out of college in no small part due to my degree and the alumni network it tapped.

      Reply
  6. MelD

    You sure know how to press my buttons – hear hear!! ;o

    No country is perfect, I think we can establish that fact for a start.

    I was very interested to read your comparison with reference to what I know about those countries as well as Switzerland, the UK and Germany.
    Here in Switzerland kids are judged by their abilities by age 12, yes, it is very young. But it’s not as if you were judging North American kids – ours grow up with a type of schooling to expect that, including the discipline (and manners) that often appear to be lacking in English-speaking countries these days. They only do 3 years of secondary school 12-15 and that is already streamed – however, a student that “blooms” later will (nowadays) have the chance to rise through the ranks, so to speak, at any level if they work hard in the required style. And you may have to repeat a year if you don’t get the grades… From 15, 10-20% will go on to do a 4-yr school/pre-college that prepares them for the “maturité” exam, in 13 subects (for everybody) which enables them to study at a university or technical college or teacher training college. The rest will do 3-4 year apprenticeships, some of them doing a vocational “maturité” at the same time or later that will also enable them to attend a technical college once they have qualified at their profession – this could be anything from fashion design to engineering to business at master’s level. If they then do an additional bridge year, they could also go to an academic university – all Swiss unis have excellent reputations; there aren’t many of them. This is just one of many routes. What I am trying to show is that it doesn’t mean that if you didn’t make the top stream in the first place, you are doomed to be a street cleaner… You can always work your way up or change your profession, but you start at a lower level – if you want to be a landscape architect, you start with an apprenticeship in gardening, or an interior decorator will start as a housepainter etc. so a smart kid will always get on. In fact, there can be benefits – my husband went through a regular office apprenticeship plus his military service as an officer and that experience combined had him at a level above MBA candidates by the time he was in his early 30s, mainly because he had the practical experience as well as the theoretical he was learning along the way – it is still a problem for him that highly-qualified people do not understand the workings of business, it drives him crazy, but he has been extremely successful. But it has never been in his way that he does not have that education – he is highly educated in a much broader way! In other areas the young people are highly qualified by the age of 19 and regularly win international competitions for hands-on professions in building, carpentry, electronics etc. for their precise and skilled abilities, of which they are rightly proud (that’s why our houses are so well built lol!). Nobody feels they have been dumped because they “only” did an apprenticeship – by 3-4 years of working experience and day or block release courses at vocational college, they really know what they’re doing. In fact, we have practically no unskilled workers in Switzerland, even the person selling you shoes will have trained/be training as exactly that – it means we don’t have menial jobs for teens to take on, but I’m never sure if that is an advantage or a disadvantage! Maybe that is why our country works pretty well and runs like clockwork…
    The other thing is that we are not a social state like France. For those who do study, it is not the school fees that are expensive, it is what to live on while you are studying. Fees at our fine universities are peanuts, basically. You have to live somewhere, though, eat something, buy books and materials, and not everyone is rich enough to provide a second home for their student kid but of course there are some ways of managing, though many feel that those who go through an academic route are the rich ones, it’s more perception than reality. However, it is true that if your parents are doctors, lawyers or architects, it is more likely that you may go that route. In addition, our kids are often 19/20 or older by the time they go to universities and are a lot more mature in their outlook (many may have been working in addition to studying since they were 15) so they take their studies very seriously – and motivation is a big key to success, of course!
    Going back to small children – we do not have state daycare, either. The need for daycare has only arisen in the last 30 years in towns and cities, as for a long long time, women were home (even if they worked, it was at a small home business or similar where they were on hand for their families) and that is only slowly changing. There are now many more daycare options and they are pretty expensive, so mostly used by single parent families, and other solutions are found, such as family and friends helping out. A family who is not all-out consumerist can usually still live on one salary comfortably.
    And this despite the fact that we also do not have state healthcare. However, we do have obligatory healthcare insurance and the market has opened up as costs have risen and different models have been developed. People are often very loyal and will stay with a company even if it’s not the cheapest (though that is changing a bit when it hits the purse!); I pay, mid-range, monthly nearly $400, so we are now paying nearly $1000 for a family of 3 with one adult daughter (under 18s pay a lot less – it was $60-100 for her until my daughter turned 18, now it is $260). That is for general healthcare as opposed to private (there is little difference – you get to go in a 2-bed room if you’re privately insured, but you get that if you are seriously ill anyway, so I don’t think it’s worth it!) and our medical care is excellent. We would not enjoy being ill in France from what we’ve seen…!! By Swiss standards, it seems pretty shabby :o.
    Of course, if you get social benefits from the state, they will pay your healthcare – but there is a very low rate of real poverty here, certainly not like in other countries, there are a few working poor in gastronomy, for instance. We also have extremely low rates of unemployment – which I think also has to do with the high level of skilled labour. Yes, and probably still because many women are at home with their families! Increasingly, young women are able to work part-time and therefore the work-life balance is very good, because they have the satisfaction of continuing to work in their profession and earn their own money, but they can still be there for their family and home – when I talk with other women, we all seem agreed that it is hard to have a “proper” and clean, well-organised home (important for the Swiss!) and a family if you work more than 60%… personally, I think that is a healthy way to think though others may disagree, I guess. When I talk to people in other countries it is usually a case of the “wants” that forces both parents to work 100% because everyone expects to have everything these days and wants to emulate the rich people on TV, but that is another subject. Here, you pay more for good classic quality and then things last and you don’t expect to have the latest thing all the time – e.g. my kitchen is 25 years old but it is so solidly made that it will go another 25, I expect, whereas a British cousin has had 3 kitchens in that time because they are so shoddily made! Same with furniture and beds etc. – where Ikea is considered mid-price or even expensive to working class people in Britain, for us it is the cheapest place to go (I still like it but then I am not a “true” Swiss, only by marriage haha!) by far.
    As for saving, the Swiss are big savers and love paying cash, but it is all extremely understated – understatement is so typical of this country! We do have credit cards but they are paid off every month and I don’t know of a bank where you can run up credit card debt. You save to buy something you want and that includes houses, as you can’t get a mortgage unless you have at least 20% downpayment. We have a high percentage of renters. And the Swiss travel a lot and spend on those experiences – it is not unusual to take 3 mths unpaid to go and travel when you are in your 20s. (You also have 2-3 mths notice on a job as long as you have worked there a year or more, 6 mths if you are management, same with rented apartments, it’s usually 3 mths notice.)
    Pension schemes are also in place. You pay a percentage of your salary towards a basic pension and from the age of 25 you pay an additional sum to top that up and you can invest in a 3rd private pension scheme, of which a certain sum annually is taxfree. Anything more is optional. This does pretty much cover retirement, which is now being raised to 65 for both men and women (for a while, women got to retire earlier but that is being phased out – equality goes both ways!). However, as in a lot of other countries, who knows if this will still work by the time we hit retirement, perhaps we will make it (late 40s) but there will be changes for the following generations, I assume.
    Re. building quality France v. Switzerland – I just wanted to say that when there was a fire in the fusebox at our house in Brittany, we asked why the architect had placed it in such an inconvenient spot? The answer: “quel architecte?!” We wonder why our house is still standing after 45 years of coastal storms, but fingers crossed, we haven’t had to rebuild it quite yet… ;o
    You simply wouldn’t believe the quality of building in Switzerland compared to elsewhere!! (not just in our historical home lol!)
    Sorry for the hijack, it’s just too interesting… 🙂

    Reply
    1. save. spend. splurge.

      THANK YOU for such a detailed response. Your comment is extremely interesting as it comes from a Swiss perspective and I only have a French one (to date).. 🙂 Perhaps German or Norwegian if my other European readers would care to chime in.

      Note: I did not mean to suggest that if you didn’t make it to the higher echelons that you are screwed, but it’s that you don’t get into the schools everyone considers prestigious.

      We have family members who are chefs, mechanics and the like, who LOVE their jobs and do very well, and some of them actually chose NOT to go into higher education.

      Reply
    2. save. spend. splurge.

      Also, if French healthcare seems shabby to Swiss eyes, you can imagine what Canadian or American healthcare must be like 😉

      Reply
  7. Debt and the Girl

    This is very interesting. It is amazing to see the vast difference on America with other countries. That figure about the number of colleges being actually beneficial for students is alarming. I have a feeling my school didn’t make the list.

    Reply
    1. save. spend. splurge.

      That statistic shocked.. and didn’t shock me.

      Reply
  8. Mary

    It is always interesting to see how many people like the idea of other people getting “filtered out” based on some esoteric definition of aptitude. This so often ignores that aptitude can be overcome with desire and hard work and probably more illusive qualities. I always wonder if they consider that they would have been filtered out, and often figure, based on my own observations – nope.
    I seldom believe that everyone everywhere agrees with everything going on in their country, culture, or neighborhood.
    I worked in a company that made it into a well read magazine because it was a wonderful place for mothers to work because it had childcare, they even talked to mothers who had children enrolled. As is so often the case, the magazine talked only to middle and upper managers, as the majority of workers could not afford to bring their children, the cost for one child per week equaled a week’s pay.
    The French may be doing many things well, and so – good for them.
    Why are you living in Canada if France is so much better?

    Reply
    1. SP

      @Mary: I’m more interested in voluntary tracks, rather than “filtering out”. For example, there should be more robust advanced and AP program at all schools, and equally robust help for those who fell behind for whatever reason. A free, public opportunity for all students to be challenged appropriately, and an overall more individualized approach to education and learning. I know many people who were utterly unchallenged in high school, and it seems non-optimal to spend 4 years of your young learning life being unchallenged. There usually are some resources for “extra” learning on top of what is standard, but many students/parents don’t know about them. Better guidance counseling would be nice in that respect. (As a note, my school had no AP, and the only “advanced” or “honors” options were to accelerate your math by a year and you could choose to take physics or not. You could theoretically take classes (for free?) at the local colleges, but it wasn’t something that was discussed/encouraged.)

      With tech & the internet these days, it is likely easier to find free resources for students that are more individualized.

      I’m uncomfortable with mandatory tracking imposed by above. But I’m also not satisfied with forcing all students to the median.

      Reply
      1. save. spend. splurge.

        Yes I should have noted (as I’ve mentioned in the comments) that the filtering out is a bit harsh in France but it doesn’t mean your life is over. It just means you have to work harder to get to where you want to go (if you wanted to break that barrier), and/or sometimes its voluntary that you don’t go on to higher education — it isn’t easy to go to prep schools and then be rejected after 2 years of intense studying.

        Reply
    2. Anonymous

      @Mary: I don’t like the idea of a forced track either. I was a C student in high school. In fact I barely graduated. In college I have a 3.7 GPA and I take the time to study. I chose IT as my field.

      How limiting my life would have been had I listened to my teachers back in high school. Thank goodness there wasn’t a forced tracking program like there is in France. I would have been screwed for sure.

      However here is something that bothers me about the U.S. system, you go to school for 13 years (with kindergarten) and you come out not being qualified to do any kind of work other than flip burgers.

      I wish there had been a voluntary career track where you could train for a career. I would have loved for a mix of general education and career classes that would have prepared me for work as an accounting assistant or a junior software developer straight out of high school so I wouldn’t have had to take crap jobs.

      And if my high school have offered a program like that, I would have taken that honestly. Then I would have saved up the money and gone for a bachelor’s degree or taken tuition reimbursement and gone to college that way.

      That’s much better than flipping burgers, working in retail or call centers. 4 years of general studies in high school is just too much and a waste of my time.

      If I could do it all over again, I would have taken a voluntary track that would have prepared me for work like a junior software developer or accounting assistant, or I would have graduated early, or dropped out, taken the GED and gone to college earlier.

      I live in an at will state I know some people who didn’t go to college but they learned programming and development growing up and they got jobs as junior developers right out of high school. They are making close to six figures now.

      I know several who went to the state university and got their computer science degrees and are now making $70-80,000. People here don’t generally care where you went to college just that you went and got an education. Although IT is a cool field where degrees aren’t always necessary.

      An at will state and it’s not as bad as it sounds. Frankly a lot of companies don’t want to fire people for silly reasons.

      In fact many companies are very careful about how they fire people because regardless of my state being an at will state, the fact is that there are many employees that mess up, get fired and choose to sue their former companies. Happens a lot actually.

      Since I moved to here, I haven’t been without a job. It’s easy to find a job here and no one will sneer at you if you have been unemployed.

      I’m sorry but there is no such thing as a free lunch. Everything comes out of taxes. If someone didn’t save for their retirement then that’s not something that should fall on me. That was their own irresponsibility and why should I pay for someone’s retirement when they spend it all like a drunk congressman during their working years.

      The people I wouldn’t mind helping are the people who did everything right but some misfortune happened like a horrible accident where they’re not able to work. Why should I support some spendthrift who partied like a drunk congressman all their life and didn’t save a penny for a rainy day?

      I suppose all of us are nationalistic and patriotic to our own respective countries and we think the countries we are from are better than those “other foreign” countries. Also the U.S. has medicare and medicaid, isn’t that socialized medicine? Taxes pay for those.

      No I don’t think France is better than Canada or the U.S. or other developed countries. Sure it’s easy to pick on the U.S. but I’m not envious of the French. I’m not envious of their tracking system or their picky employers, or their socialized health care.

      I suppose if there is anything that I’m jealous of the French is their beautiful language, rich history, the magnificent people throughout its history and the beauty that is France. No I’m not from France and I don’t even know anyone in France. 😉

      In fact I’m currently obsessed with the song “Libérée, délivrée” (pop version) from “La Reine des Neiges” by Anaïs Delva. I don’t understand a word of French but I ADORE that song. I’m not sure how familiar you are with Disney movies or if you even like them at all, some people don’t, but “La Reine des Neiges” (The Snow Queen) is what “Frozen” is called in France.

      The U.S. has a lot of problems like NSA spying, interference with the business of other countries like the Iraq war, the TSA that pats “free people” like they are criminals, stupid people that voted a second time for Bush and Obama.

      The police in the U.S. are becoming military-like and ignoring warrants, police brutality, the problem of Guantanamo bay and the abu ghraib scandal, taxing Americans who leave the U.S. for other countries to the point where Americans are giving up their U.S. citizenship, etc.

      I’m not ignorant of the problems in America and they do bother me. I’m sure I could find numerous problems with other countries. I suppose the reason I’m not an expat yet is because is because people are alike all over and I would encounter different and some similar problems if I left the U.S.

      Everyone has a sense of nationalism and I suppose if I had been born and raised in Sweden then I would love my beloved Sweden. I suppose if I had been born and raised in France then I would love my beloved France.

      I suppose if I were Canadian like yourself then I would love Canada and be patriotic toward Canada. I suppose its very human and we’re all trained to love our respective countries for the most part.

      I wasn’t born in the U.S. as I’m a naturalized U.S. Citizen but even though I’m a U.S. citizen, I still feel a sense of pride and fondness for my country of origin. I admire my country of origin’s rich history and the strength of its people. I’m awed at what my grandparents lived through.

      That doesn’t mean I would betray the U.S. no it just means that I can be a U.S. citizen and still appreciate the country that I was born in.

      Well I’ve blabbed enough, not sure how much this post made sense, it’s late here about 10:59 pm. But I just wanted to point out nothing is perfect no matter where you go. Yes things can be VERY good, almost excellent but not quite perfect.

      Reply
      1. save. spend. splurge.

        A forced track doesn’t mean your life is over as Mel from Switzerland correctly pointed out.

        I should have made it clearer that you aren’t doomed to pick up garbage and work retail the rest of your life in a forced track, it just means that you chose to do a more technical job which could include programming but also includes jobs like being a mechanic, plumber, electrician, programmer (in some cases), and so on.

        I am not very loyal to any country to be honest. I see the good and bad in each. I love the dynamic nature of the U.S. and its innovative culture that feels confident it can do anything (and does it!!).. but I prefer the slightly less splashy environment of Canada where I at least have universal healthcare..

        Reply
        1. GirlinaTrenchoat

          @save. spend. splurge.: “Citizen of the world, patriot of none” is how I sometimes feel, and I say this with a whisper of guilt because it makes me think I’m being ungrateful to both the country of my birth, and where I now live. There are great things about all countries, and we definitely can’t say one place is overall better than another, it’s just a matter of personal taste.

          Reply
          1. save. spend. splurge.

            Exactly. For me, Canada is the right fit for all the points I need, particularly being a freelancer.

        2. Anonymous

          @save. spend. splurge.: I see, well I prefer no track at all. Forced tracking just seems elitist and I will personal protest against it if it comes to our schools although I don’t have children.

          I would prefer voluntary tracking, voluntary technical schools for children who want to go that route and parents who see that their children will want that for themselves.

          Especially when I wasn’t a good math student in high school but in college, I took remedial courses and am now in intermediate math, next quarter I’ll be in college algebra.

          I wouldn’t have had this chance in France. I would have been doomed in France. Life is challenging, why make it more difficult than it already is by adding forced tracking? Seems cruel.

          Judged by abilities at 12? WOW. All I did at 12 years old was go to school, watch TV and read Harry Potter. As an adult I have an interest and passion in so many different things and pursue them with passion. I also did poorly on standardized tests so the French way of life would surely have doomed me.

          If I had been in France or another country that allows forced tracking then I’m not sure I’d be where I am today. I don’t see the point of tracking because American students don’t even choose STEM majors for the most part.

          Many of them choose easy majors. Others want to be famous which is why shows like American Idol are popular among Americans. I don’t watch talent shows for the most part.

          What about people who didn’t take seriously their studies in h.s. but are adults and want to go for a better career? Do they even allow non-traditional students to go to university during the day in France?

          As for splashy it really depends where you go.I would never live in NYC, Seattle, Miami, San Francisco, L.A. or another big city like that. I’ve lived in the U.S. for over 10 years and it depends where you go.

          Another thing that disappoints me about the U.S. is that many Americans seem to want to be anti-intellectual. In fact a book was written in the 60’s I think called, “Anti-Intellectualism in American Life.”

          It’s on my reading list. It may have been written in the 60’s but it seems to be true today. So it’s not hard to see why people who go into STEM’s make the money that they do.

          See link on students that choose easy college majors.

          http://online.wsj.com/news/articles/SB10001424052970203733504577026212798573518

          Reply
          1. save. spend. splurge.

            France has a horribly strict educational system which I find both good and bad. I like that they push the students and they learn a lot (many students can quote philosophers and writers LONG after school has ended, and they aren’t necessarily all white collar workers), and I think a little competition is healthy to get children motivated and to make them work.

            That said, they take it to the extremes sometimes.

            I also mind and don’t mind forced tracking because it means they’re not wasting money on students who don’t want to be there / can’t really advance beyond their abilities and are encouraged to move into other fields that don’t require academia (cooking, etc). I don’t see it as a bad thing, but I guess for a lot of North Americans it takes away their freedom of choice and liberty, so it makes them very angry.

    3. save. spend. splurge.

      I should have noted (as I’ve mentioned in the comments) that the filtering out is a bit harsh in France but it doesn’t mean your life is over. It just means you have to work harder to get to where you want to go (if you wanted to break that barrier), and/or sometimes its voluntary that you don’t go on to higher education — it isn’t easy to go to prep schools and then be rejected after 2 years of intense studying.

      I think that’s the thing I like about North America is that you don’t have that kind of filtering or rigid rule system.. which is also the reason why a lot of French people (including BF and Pauline who now lives abroad), leave the country if they don’t find it to be the right fit for them.

      As for your comment about living in Canada — I am Canadian, not French.

      I am unable to work in France for one thing, as I am not French and do not speak perfect French, and I never said I wanted to live in France. I do not have the papers, so while your question is valid you should also consider that I haven’t said everything in this post (it would become massive, reaching 5000 words if I covered everything).

      You’re only seeing the one side of the argument where I support what Pauline has said in her post.

      I have mentioned plenty of times in my various posts in archives that France is not a country I would ever consider living in. It’s filthy in Paris, the food has gone down in quality, the jobs are not interesting at certain levels and it’s a harder work environment to be in for someone like me who was raised in Canada.

      Reply
  9. SP

    I’m not sure what went wrong with your family member’s situation, but it is not true that if you didn’t save enough you don’t get to retire. We have a social security plan that is somewhat similar to Canada’s, albeit even less generous. You do have to have worked for at least 10 years (or have a spouse who did), and I think 30 or 35 for full benefits. Just a note.

    I think one reason college is so common here is the public schools can’t do a good enough job educating everyone. There are no real “tracks”, so the classes are tuned to the average student. (Some schools have advanced tracks, but not all.)

    Pretty interesting stuff – France has a lot of plusses, but I think there are other countries that I admire even more from this perspective (norway?).

    Reply
    1. save. spend. splurge.

      I’ll tell my aunt that, but she keeps moaning on the phone how she only has $40,000 saved and can’t retire, so she’s working even in her late 70s in a factory. 😐

      I do think that tracks would make more sense in schools, I like Anonymous above, find it really hard to swallow that after so many years in school you aren’t qualified to do anything but basic retail jobs after you graduate high school.

      Where was it ever written that you need to have a college degree to succeed?

      Reply
  10. AdinaJ

    This was very interesting; some I already knew, some was new. The French system certainly has some attractions (the school system for one) though I wonder how sustainable it all is in light of current/future demographics.

    Every time I’m seduced by the low cost of living (well, of consumables and housing) in the US, I think about things like healthcare and reconsider. I can’t imagine having to pay $1,000-2,000 a month for basic coverage – there go the retirement savings.

    Reply
    1. save. spend. splurge.

      Everything in the U.S. is much much cheaper that is true.

      The French system is also not sustainable.. that’s another post for another day, but basically BF has considered he will receive $0 from the government when he reaches retirement age because all the Baby Boomers who are living well into their 90s on good French food are cleaning out the retirement pot.

      Reply
  11. Michelle

    There are so many lessons that North American society could take from France, public transportation being one! Our transportation in Toronto sucks compared to France and the UK. It’s a dream getting around in Europe.
    I agree on the College/University topic, we’re becoming a society where BA’s and MBA’s are a dime a dozen because people buy them. It’s a minimum now on a lot of job applications for companies to request a BA.
    The housing bubble in Toronto scares me too, there’s too many investors here, especially in the condo market. I haven’t bought a house or condo because a)too expensive b)I believe house prices are going to crash soon, c)it takes a long time to save 10% down when you like clothes like I do :S

    Reply
    1. Anonymous

      @Michelle: I would personally love a better public transportation system in America.

      Reply
      1. save. spend. splurge.

        They did a study saying that Toronto and NYC had some of the best public transportation systems!!! I was shocked to see Toronto on the list because living here, I am not pleased with the way things are run, although big changes are coming (new subway line.. hopefully, and changes to the fare system), they’re coming about 10 years too late in my opinion.

        Reply
        1. Michelle

          @save. spend. splurge.: Yes! Way too late! Our entire infrastructure is at least 10-15 years behind. The highways are outdated along with public transpo. I really hope that new LRT line they’re putting in does all the wonders it’s supposed to. It would be really nice to finally have a link from Pearson airport into Toronto. I think we’re one of the last major cities in the world to have it.

          Reply
          1. save. spend. splurge.

            Are we even getting the LRT line? I feel as though no one knows how to fund it, they only know how to say: We are getting a relief line! VOTE FOR ME!

            I also found it pathetic we didn’t have a direct link to the airport. It’s really sad, actually…. I always take the TTC and when the bus goes on the highway, I sigh and think “how quaint”…

    2. save. spend. splurge.

      Toronto is RIDICULOUS!!!!! I keep watching HGTV with my jaw dropping open at how people will pay so much money for a home that is clearly not worth it.

      Reply
  12. GirlinaTrenchcoat

    Oh yeah original question was left unanswered hehe. No, I never thought about the global attitude of different countries towards savings and debt, but now that you’ve laid these out, North America seems pretty high on the list of bad habits. Glad to see the BRICS have a better mindset.

    Reply
  13. GirlinaTrenchcoat

    Truly the French know how to enjoy life at all price points it seems. 🙂 You know what else I find awesome about France? The paid maternity leave! I only WISH the US had this (and five week vacations).

    I love how there aren’t that many store credit cards in Europe either. In the States these “offers” are so annoying; I get asked all the time if I want a ‘discount/membership/rewards card’, and when I was new to the country I had no idea that these things were really credit cards! I ended up unintentionally applying for several of these things and dinging my credit score pretty badly with the hard inquiries.

    Reply
    1. Anonymous

      @GirlinaTrenchcoat: I wouldn’t mind five weeks of paid vacation. Pretty much the only way you will get five paid weeks is if you save up the PTO for it or take a sabbatical. 🙁

      Reply
      1. save. spend. splurge.

        I’m jealous of the 5 week paid vacation thing too. Ironically I am told that even though they get 5 weeks, not all French people have the cash (especially now with the Euro having screwed everything) to go on vacation so they stay at home and watch TV.

        Reply

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