Living in the world’s most expensive country

Australia may be the most expensive place to live but there are ways to keep your finances in order. 

Yes, it’s true: according to an annual world consumer price index1 Australia is the most expensive country to live in. These days it’s 12% more expensive than the United States, while India is the cheapest of the 19 countries examined.

Sydney and Melbourne rising out of reach

A roof over your head is no longer a given in Australia, especially in Sydney, the 5th most expensive city in the world.

House prices at historic highs―and almost five times the average household income of residents—are forcing some Sydney families to consider moving elsewhere2.

Melbourne residents live in the 8th most expensive major city with a burgeoning population pushing demand higher. While annually Sydney’s population has been increasing by 80,000 people, 95,000 are settling in Melbourne prompting demographers to predict Melbourne’s population will overtake Sydney’s by 20303.

More than rising property prices

Australians are feeling the pressure from more than just property prices. When it comes to basic goods and services the annual world consumer price index found the cost of living in Australia is more expensive than most other places.

Booking a room

Sydney is the most expensive when it comes to short-term accommodation. A five-star hotel room in Sydney is 232% of the cost of its New York counterpart whereas you’d pay just 72% in Melbourne.

Buying a drink

Two-litres of soft drink in Sydney will cost 51% more―and just 18% more in Melbourne―than in the Big Apple. When it comes to beer, Sydney and Melbourne both offer better deals than New York. And as you might expect, Germany—at about half the price—is the place to raise your glass.

Shopping for clothes

You guessed it. Australians pay more than Americans whether it’s buying Adidas runners or a pair of Levi's jeans. But we pay less than most Europeans for the same items.

Paying your fare

Getting from A to B is no laughing matter in Sydney. Public transport fares are higher than any other city in the world, with  taxi fares 15% more expensive than New York’s.

Keeping fit

One thing cheaper in Sydney and Melbourne is gym membership. It’s about half the price of New York’s.

How to get ahead

While Aussies’ living costs continue to rise it doesn’t mean building wealth is impossible. But it’s vital to get a handle on your finances by planning ahead and taking the pressure off.

Work towards building wealth

Start by managing your income effectively. Download MoneySmart’s TrackMySPEND app so you can see where your money’s going and use our budget planner to work out where you can cut down.

Then work with a financial adviser to build long-term wealth while meeting living costs.

Take the pressure off

If it’s all too much and you’re considering moving away from the big smoke, visit the Numbeo website where a cost of living calculator generates comparisons for everything from a café latte to a three-bedroom apartment.

Getting ahead is possible when you plan ahead. If you’d like to find a financial adviser call us on 131 267 and we’ll put you in touch with someone who can help.

1 Deutsche Bank, Mapping the World's Prices 2015, http://pull.db-gmresearch.com/cgi-bin/pull/DocPull/17411-76F9/99524599/DB_RandomWalk_2015-04-14_0900b8c0898020b1.pdf

2 Sydney Morning Herald, smh.com.au/nsw/sydney-tax-why-you-pay-150000-extra-to-live-in-emerald-city-20150606-ghhb3z.html.

3 Sydney Morning Herald, smh.com.au/nsw/sydney-tax-why-you-pay-150000-extra-to-live-in-emerald-city-20150606-ghhb3z.html.

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© AMP Life Limited. This provides general information and hasn’t taken your circumstances into account. It’s important to consider your particular circumstances before deciding what’s right for you. Although the information is from sources considered reliable, AMP does not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision. Except where liability under any statute cannot be excluded, AMP does not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person.