PsyGuy is pretty vocal about this topic and I must say that I am very curious myself. I am wondering if a family of 4 could survive on 1 salary of 63,000 euros in Western Germany?
Do any of you have any experience doing this? I'd like to lve in WE one day, and I am very curious to gain more info on this topic.
Happy New Year to all f you as well.
A family of 4
I live in Germany.
The average salary for a German family of 4 is 40,000. I make around this and support 2 people comfortably. My bf's family makes less than this and supported 4 children. Two are still at home.
I think a lot really depends on where in Germany, some of the less expensive cities I think it would be possible.
Here's a tax calculator in English http://www.parmentier.de/steuer/steuer.htm?wagetax.htm
I find the cost of living here to be extremely low. I eat out, travel once every 2-3 months and have 1 or 2 out of Europe holidays a year. I don't drink often (though beer is cheaper than cola), eat meat (I do think I save a lot of money here) and have a cheap apartment.
Depending on the age of your kids and what kind of school you put them in that can eat up a lot of salary. Options are:
1. put them in int'l school with the tuition waiver and pay about 200-300 a month in extra taxes
2. if they are young enough put them in German schools, which are great and would allow them to become bilingual.
3. Some cities have EuropeSchules, which are bilingual and some start at the primary level and others at grade 5, which is gymnasium.
One family I know is here on an international assignment and couldn't find an appropriate place for their teenage daughter and she is doing a study abroad year here as part of her high school in the U.S.
There are lots of different options and many things to consider. It's not impossible, but you won't have the flash expat lifestyle you are perhaps used too.
I've been here for 2.5 years and don't have plans to leave. In fact and possibly taking a pay cut in the near future to work in a more bilingual environment and improve my rubbish German.
The average salary for a German family of 4 is 40,000. I make around this and support 2 people comfortably. My bf's family makes less than this and supported 4 children. Two are still at home.
I think a lot really depends on where in Germany, some of the less expensive cities I think it would be possible.
Here's a tax calculator in English http://www.parmentier.de/steuer/steuer.htm?wagetax.htm
I find the cost of living here to be extremely low. I eat out, travel once every 2-3 months and have 1 or 2 out of Europe holidays a year. I don't drink often (though beer is cheaper than cola), eat meat (I do think I save a lot of money here) and have a cheap apartment.
Depending on the age of your kids and what kind of school you put them in that can eat up a lot of salary. Options are:
1. put them in int'l school with the tuition waiver and pay about 200-300 a month in extra taxes
2. if they are young enough put them in German schools, which are great and would allow them to become bilingual.
3. Some cities have EuropeSchules, which are bilingual and some start at the primary level and others at grade 5, which is gymnasium.
One family I know is here on an international assignment and couldn't find an appropriate place for their teenage daughter and she is doing a study abroad year here as part of her high school in the U.S.
There are lots of different options and many things to consider. It's not impossible, but you won't have the flash expat lifestyle you are perhaps used too.
I've been here for 2.5 years and don't have plans to leave. In fact and possibly taking a pay cut in the near future to work in a more bilingual environment and improve my rubbish German.
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Speculative Bubble
- Posts: 14
- Joined: Sun Dec 23, 2012 1:34 am
Thanks for that info, seashell, I was wondering the same thing about Germany. The 200-300 euros/month tax you mentioned is that tax on the free tuition (that is considered a benefit and taxed as such)? Is that per child?
I'm also with a family of 4 living on a single paycheck and I crossed Germany off of my list because of the 40% tax and the taxed tuition fees. Am I wrong doing this?
I'm also with a family of 4 living on a single paycheck and I crossed Germany off of my list because of the 40% tax and the taxed tuition fees. Am I wrong doing this?
I don't have children and the teachers I work with at my school are either married to Germans or have been in Germany well before our school opened so their children are all in German schools where they have been successful. I don't quite understand the tax on tuition. FIS has information on their website about the tax and explains it better than I could: http://www.fis.edu/page.cfm?p=373
As a married person with 2 children you are not taxed at 40%. I am in the highest tax bracket because I am single. I'm in tax class I, you'd be in class III, your spouse could also earn up to 8,000 Euro a year without having to pay taxes on it, though they may then become responsible for their own insurance. You might see a lot of Int'l Schools look for subs on a 400 Euro mini job basis. If your spouse did this they would remain on your insurance and not pay taxes.
You'd also possibly be eligible for kindergeld, which is a monthly 184 Euro per child.
A good tax adviser is paramount here. Yes, taxes are high, but you can also reclaim tax at the end of the year. For example, I'll be claiming my Masters program tuition as a work related education expense. I also have a home office that I can deduct.
As a married person with 2 children you are not taxed at 40%. I am in the highest tax bracket because I am single. I'm in tax class I, you'd be in class III, your spouse could also earn up to 8,000 Euro a year without having to pay taxes on it, though they may then become responsible for their own insurance. You might see a lot of Int'l Schools look for subs on a 400 Euro mini job basis. If your spouse did this they would remain on your insurance and not pay taxes.
You'd also possibly be eligible for kindergeld, which is a monthly 184 Euro per child.
A good tax adviser is paramount here. Yes, taxes are high, but you can also reclaim tax at the end of the year. For example, I'll be claiming my Masters program tuition as a work related education expense. I also have a home office that I can deduct.
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Speculative Bubble
- Posts: 14
- Joined: Sun Dec 23, 2012 1:34 am
Reply
Yeah you can do fine on €64K. A family needs about €50K to make it work. The average salary is around €30K a year.
Lets do the math. First on €64K you will exceed the foreign income tax credit by about $10K US which you will owe taxes on (about 30% on that 10K).
The german tax rate at €64K is 42% off the top is €26,880 in taxes, giving you €37,120 after taxes.
You then have your free tuition waivers that are a taxable bennefit. the average tuition waiver is valued at €10K each (you have 2) so you owe taxes on those and at 42% means the tax is €4,200 each or €8,400 combined. Take that off the €37,120 and you have €28,720. Subtract another €2000 for your US taxes and you have €26,720. Annualize that over 12 months and you have €2,226 a month.
Without getting into a lot of detail, here are some average housing costs by city (3 bedroom apartments, utilities include electric, gas, water, trash, internet)
Frankfurt:
Apartment (3 bedrooms) in City Centre 1,150.00€
Apartment (3 bedrooms) Outside of Centre 900.00€
Utility 181€
Munich:
Apartment (3 bedrooms) in City Centre 1,550.00€
Apartment (3 bedrooms) Outside of Centre 1,250.00€
Utility 247€
Your looking at around 1/2 to 3/4 your income for housing, which leaves a little over a 1000€ or so leftover.
Lets do the math. First on €64K you will exceed the foreign income tax credit by about $10K US which you will owe taxes on (about 30% on that 10K).
The german tax rate at €64K is 42% off the top is €26,880 in taxes, giving you €37,120 after taxes.
You then have your free tuition waivers that are a taxable bennefit. the average tuition waiver is valued at €10K each (you have 2) so you owe taxes on those and at 42% means the tax is €4,200 each or €8,400 combined. Take that off the €37,120 and you have €28,720. Subtract another €2000 for your US taxes and you have €26,720. Annualize that over 12 months and you have €2,226 a month.
Without getting into a lot of detail, here are some average housing costs by city (3 bedroom apartments, utilities include electric, gas, water, trash, internet)
Frankfurt:
Apartment (3 bedrooms) in City Centre 1,150.00€
Apartment (3 bedrooms) Outside of Centre 900.00€
Utility 181€
Munich:
Apartment (3 bedrooms) in City Centre 1,550.00€
Apartment (3 bedrooms) Outside of Centre 1,250.00€
Utility 247€
Your looking at around 1/2 to 3/4 your income for housing, which leaves a little over a 1000€ or so leftover.
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calciodirigore
- Posts: 155
- Joined: Mon Jan 26, 2009 12:16 pm
- Location: Europe
I was in Munich with 2 dependents at a top tier school earning over 60k and could not cope at all. Life in southern Germany is incredibly expensive. We had to leave because we couldn't make ends meet. On top of ludicrous food and housing costs, tuition is a taxable benefit - we were then looking at about 500 euros a month for our child.
Bottom line...not worth it.
Bottom line...not worth it.
Reply
It would go a little farther in Dusseldorf but youd still be looking at half your salary for housing expenses. Getting your kids into a euro or bilingual municipal school and saving the extra 600€-800€ tax on your tuiton would make a big difference. There isnt one in Dusseldorf (that I know of) but there is in Frankfurt and Munich. Youd be able to afford a nice but modest lifestyle.
Tuition is a taxable cash benefit, you owe taxes on the value as if it was salary.
Tuition is a taxable cash benefit, you owe taxes on the value as if it was salary.
Munich is very expensive and there's a housing shortage making it really difficult for even Germans to find a nice place. My friends brother and his gf still live in separate studios even though they'd like to move in together, but haven't been able to find a place. Also the Bavarians are quite different from the rest of Germany. The nostalgic image many of us have of Germany is Bavaria and well the Germany I live in (NRW) is nothing like that!
I can't really speak about Frankfurt, except Frankfurt Airport is horrid.
In Duesseldorf a lot of teachers live in Derendorf where rents are between 750-1000 for an 85-100 square meter place. Apparently ISD is having a reduction in force this year. I find the city of Duesseldorf to be a bit snobby.
If you have an EU passport you have no problems and your wife and children would automatically get residence permits and permission to work for your wife. You would get kindergeld even though your kids are not eu passport holders. They will be rude at the Auslander office though because everyone who works there is evil. Seriously, you'd want to make sure you have the schools support because they will not even talk to you if you don't speak German.
What about Berlin? The Euro goes even further there and it's a great multicultural city.
I can't really speak about Frankfurt, except Frankfurt Airport is horrid.
In Duesseldorf a lot of teachers live in Derendorf where rents are between 750-1000 for an 85-100 square meter place. Apparently ISD is having a reduction in force this year. I find the city of Duesseldorf to be a bit snobby.
If you have an EU passport you have no problems and your wife and children would automatically get residence permits and permission to work for your wife. You would get kindergeld even though your kids are not eu passport holders. They will be rude at the Auslander office though because everyone who works there is evil. Seriously, you'd want to make sure you have the schools support because they will not even talk to you if you don't speak German.
What about Berlin? The Euro goes even further there and it's a great multicultural city.