Personal Finance
How Money is Spent by Different Income Groups
How Money is Spent by Different Income Groups
If you started making twice the amount of money that you do today, how would your spending habits change?
Consider if the tables were turned, and you instead were reduced to half of your current income. Where would you likely make cuts to spending?
The reality is that the money you have coming in has big implications on how expenses get prioritized – and so it’s interesting to see how people in different income brackets allocate what they have.
Visualizing Spending
Today’s series of graphics come to us from data visualization expert Nathan Yau at FlowingData, and they show how money is being spent by different income groups.
It uses data from the 2016 Consumer Expenditure Survey, an annual survey by the Bureau of Labor Statistics. Meanwhile, embedded words in the graphics come from Yau, as he makes observations on the data.
To Buy or Rent a House?
How do income groups differ in spending for housing?
Housing Expenses
How is money spent on utilities, furniture, and other household expenses?
Food Expenses
Do income groups spend more eating at home, or eating out?
Travel and Transportation
The cost of vehicles, gas, and other travel expenses.
Health Expenditures
What about money spent on health insurance, services, or drugs?
Pensions and Social Security
Lastly, the money going to retirement, pension, social security, and insurance plans.
For more data analysis, as well as many other great visualizations on income, we highly recommend checking out FlowingData.
Personal Finance
Ranked: The Best Countries to Retire In
Which countries are the best equipped to support their aging population? This graphic show the best countries to retire in around the world.
Ranked: The Best Countries to Retire in Around the World
Our global population is getting older. By 2050, the OECD predicts that 30% of people worldwide will be aged 65 or over.
While some countries are relatively prepared to handle this increase in the elderly demographic, others are already feeling the squeeze and struggling with the challenges that come with a rapidly aging population.
Which countries are the best equipped to support their senior citizens? This graphic uses data from the 2022 Natixis Global Retirement Index to show the best countries to retire in around the world, based on several different factors that we’ll dig into below.
What Makes a Country Retirement-Friendly?
When people consider what makes a place an ideal retirement location, it’s natural to think about white sand beaches, hot climates, and endless sunny days. And, in truth, the right net worth opens up a world of opportunity of where to enjoy one’s golden years.
The Global Retirement Index (GRI) examines retirement from different, more quantitative perspective. The annual report looks at 44 different countries and ranks them based on their retirement security. The index considers 18 factors, which are grouped into four overarching categories:
- Health: Health spend per capita, life expectancy, and non-insured health spend.
- Quality of Life: Happiness levels, water and sanitation, air quality, other environmental factors, and biodiversity/habitat.
- Material Wellbeing: Income per capita, income equality, and employment levels.
- Finances in Retirement: Government debt, old-age dependency, interest rates, inflation, governance, tax pressure, and bank non-performing loans.
Using these 18 metrics, a score from 0.01 to 1 is determined for each country, which is then converted to a percentage. For a more detailed explanation of the report’s methodology, explore Appendix A (page 72) of the report.
The Top 25 Best Countries to Retire in
With an overall score of 81%, Norway comes in at number one as the most retirement-friendly country on the list.
| Rank | Country | Score | Health | Quality of Life | Material Wellbeing | Finances in Retirement |
|---|---|---|---|---|---|---|
| 1 | 🇳🇴 Norway | 81% | 91% | 87% | 79% | 69% |
| 2 | 🇨🇭 Switzerland | 80% | 90% | 86% | 69% | 74% |
| 3 | 🇮🇸 Iceland | 79% | 88% | 86% | 77% | 68% |
| 4 | 🇮🇪 Ireland | 76% | 89% | 80% | 67% | 70% |
| 5 | 🇦🇺 Australia | 75% | 88% | 77% | 66% | 72% |
| 6 | 🇳🇿 New Zealand | 75% | 85% | 81% | 64% | 71% |
| 7 | 🇱🇺 Luxembourg | 75% | 91% | 81% | 72% | 59% |
| 8 | 🇳🇱 Netherlands | 75% | 89% | 80% | 78% | 56% |
| 9 | 🇩🇰 Denmark | 74% | 86% | 88% | 76% | 54% |
| 10 | 🇨🇿 Czech Republic | 73% | 76% | 68% | 84% | 64% |
| 11 | 🇩🇪 Germany | 72% | 87% | 80% | 71% | 55% |
| 12 | 🇫🇮 Finland | 71% | 84% | 89% | 63% | 55% |
| 13 | 🇸🇪 Sweden | 71% | 90% | 87% | 59% | 56% |
| 14 | 🇦🇹 Austria | 71% | 86% | 82% | 69% | 54% |
| 15 | 🇨🇦 Canada | 71% | 87% | 74% | 58% | 67% |
| 16 | 🇮🇱 Israel | 70% | 82% | 74% | 60% | 66% |
| 17 | 🇰🇷 South Korea | 70% | 80% | 59% | 68% | 73% |
| 18 | 🇺🇸 United States | 69% | 85% | 72% | 56% | 67% |
| 19 | 🇬🇧 United Kingdom | 69% | 83% | 82% | 61% | 55% |
| 20 | 🇧🇪 Belgium | 69% | 85% | 74% | 70% | 51% |
| 21 | 🇸🇮 Slovenia | 69% | 82% | 69% | 77% | 51% |
| 22 | 🇯🇵 Japan | 69% | 91% | 67% | 72% | 51% |
| 23 | 🇲🇹 Malta | 68% | 78% | 61% | 72% | 63% |
| 24 | 🇫🇷 France | 66% | 90% | 78% | 57% | 48% |
| 25 | 🇪🇪 Estonia | 66% | 68% | 68% | 60% | 68% |
Norway is at the top of this year’s ranking for several reasons. For starters, it achieved the highest score in the Health category, largely because of its high average life expectancy, which is 83 years old, or 9 years longer than the global average.
Norway also has the highest score of all the countries for Governance, a category gauged by assessing country corruption levels, political stability, and government effectiveness, and is in a three-way tie with Japan and Luxembourg in the Health category.
Second on the list is another European country, Switzerland, with an overall score of 80%. It’s the highest-ranked country for environmental factors, and it also has the highest overall score in the Finances in Retirement category.
A Regional Breakdown
While European countries dominate the top 10 in the ranking, how does Europe rank as a region as a whole? Before diving in, it’s important to note that the study actually breaks up Europe into two sections: Eastern Europe (grouped with Central Asia) and Western Europe.
| Rank | Region | Overall Score |
|---|---|---|
| 1 | North America | 69% |
| 2 | Western Europe | 66% |
| 3 | Eastern Europe and Central Asia | 49% |
| 4 | Latin America | 37% |
| 5 | Asia Pacific | 32% |
And from a regional perspective, North America comes in first place despite the fact no countries in the region made it into the top 10. North America only has two countries included in the ranking: Canada (#15) and the U.S. (#18), which both rank relatively high.
In contrast, Western and Eastern Europe have more countries to account for, which ultimately lowers their regional average.
The Future of Retirement
As longevity rises and the retirement aged population continues to increase worldwide, many countries are opting to change their pension policies in an effort to encourage people to stay in the workforce longer.
For instance, in 2018, people in the UK could claim their State Pension once they turned 65. By 2028, this age requirement will be raised to 67.
However, government intervention may not be necessary, as many people around the world are already staying in the workforce beyond the traditional retirement age (perhaps more out of necessity than choice).
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