Cost of living in Hungary

I have a HUGE problem with the sky rocketing property taxes in the US. I don't know... but when I enter in what my current costs are in the US are and what they would be in Hungary or Portugal it's much much much cheaper! To not have to pay several thousands of dollars every single year in property taxes would give massive peace of mind.It appears, that perhaps taxes might be worse in Hungary than if I stay in the US? But theory this makes no sense because taxes in Hungary are lower than in the US! So sorry but I am not grasping what exactly would make Hungary not much cheaper considering property taxes, healthcare cost "pennies" compared to the US! Hungary tax rate is lower than the US. Hungary has flat tax as well.My mother is forced to moved back to Hungary because the cost of living in the US has become revolting. She cannot afford to stay in the US. Many people leave the US for lower cost of living. I am not understanding why you are saying otherwise?    -@juliet1980

You just pay for your life in a different way in Hungary.  If you have a job, an employer has to pay social contributions (pension, unemployment etc) and healthcare plus your salary. So your personal rate may seem low but this is hidden from you. And it isn't the entire story.

You still have to pay for goods and services and that means  VAT is 27% (some rates lower, like food).  That means if you see an item for $100 (all labels are tax inclusive, US showing +tax is an anomaly), the item costs $79 and the tax is $21.   That's huge amounts of taxation.  So tax is just shifted to consumption.  Fuel (for your car) is probably about $7 or $8 a US gallon.   Your life will be cheaper if you don't consume anything and never go anywhere.

Sure, you get healthcare but if you are young with no conditions, then you are paying for "freeloading" others.  This is usually an argument against socialised medicine.  I don't agree with that view as I look upon it as a kind of insurance (but it's really a tax as you have to pay it and have no choice). It's just hidden from you in the deductions the employer makes.

The HU government under invests in social services.  There's nothing you can do about that except use private medicine to improve your choice.  Don't get me wrong, I fully support socialised medicine but I'd like it to be more efficient in patient care (no queues, responsive, inclusive etc).

There's also a kind of tax in the form of inflation.  Hungary has high inflation (~10%) compared to the Eurozone (~4.5%).  It means that if you have 100 HUF in the bank, at the end of the year, it's worth 90 HUF in purchasing power terms.  Hungary imports a lot (i.e. gas/oil, food etc) so you have to  use more HUF to get say, EUR or USD to buy whatever it is you want import from overseas.   This doesn't just apply to you personally, it applies to all imports paid for in HUF and resold to you. 

One upside is that those earning in EUR or USD will find it cheaper in Hungary as they need fewer USD/EUR to get the same amount of HUF and there's a lag in the system of inflationary rises.   But all that is transient and may not last.  You couldn't base your life betting on a falling HUF.

If you have only HUF at the bank, then interest rates need to be above inflation rate to keep the value.  People are under pressure to use savings to maintain their lifestyles.  It's a bit of a pressure cooker.  What people want is price stability and the HUF isn't it.   At the end of the day, it's going to be hard for the HU government to resist adopting the EUR eventually.   Orban is ideologically opposed to the EU and EUR for his own convenience/self-interest.  It'll take a change of government to adopt the EUR and obtain price stability.

Anyways, effective tax rates for individuals everywhere have been a tad under 50% for some years.  That's when you factor everything in.   These are the numbers you need to compare, not the headline tax rate. 

You can Google all this to make comparisons.

    I think healthcare is messed up everywhere... so I rather have healthcare system that cannot brankrupt me unlike in the US. I am also Canadian citizen... total NIGHTMARE there. Not to mention I have gone through absolute hell in the US with doctors.... and health insurance companies. Nightmare is too kind of a word.        -@juliet1980The Canadian system is socialised medicine.  It's a sophisticated country with high skills and huge resources.  As you are still of working age and able to work, apart from the weather, you'd almost certainly be better off there than in Hungary.         -@fluffy2560

I am self employed. Always have been. Canada's huge resources of work or job market is of ZERO interest to me. I am self employed and will always be self employed. I rather die than ever become a wage slave working for someone else. I would not even be able to afford a house in Canada! Canada is SUPER expensive with average house in the 1m range.

So I am confused why you feel I would be better off in Canada when in Canada I would not even be able to afford a roof over my head. I want simple life in the country side growing my own food like I used to, LOW property taxes and low cost of living. Canada is OPPOSITE of all that! I am not in canada for good reason. The ONLY thing good about canada is that they do not have citizen based taxation like the US. But that's the only good thing about Canada.

... and if someone renounces their US citizenship and they have stock portfolio the US will steal 30% of it. No escaping the US... they will suck every penny from you even after you renounce they hold your stock portfolio withdrawals hostage by taxing 30% of it even if you have ROTH IRA it seems? ROTH IRA withdrawals are supposed to be 100% tax free (NO tax)... but from what I recall the US will tax 30% of withdrawals from ROTH IRA once you renounce. I need to verify this info but that is what it appears to be...

   
I have a HUGE problem with the sky rocketing property taxes in the US. I don't know... but when I enter in what my current costs are in the US are and what they would be in Hungary or Portugal it's much much much cheaper! To not have to pay several thousands of dollars every single year in property taxes would give massive peace of mind.It appears, that perhaps taxes might be worse in Hungary than if I stay in the US? But theory this makes no sense because taxes in Hungary are lower than in the US! So sorry but I am not grasping what exactly would make Hungary not much cheaper considering property taxes, healthcare cost "pennies" compared to the US! Hungary tax rate is lower than the US. Hungary has flat tax as well.My mother is forced to moved back to Hungary because the cost of living in the US has become revolting. She cannot afford to stay in the US. Many people leave the US for lower cost of living. I am not understanding why you are saying otherwise?    -@juliet1980

You just pay for your life in a different way in Hungary.  If you have a job, an employer has to pay social contributions (pension, unemployment etc) and healthcare plus your salary. So your personal rate may seem low but this is hidden from you. And it isn't the entire story.

You still have to pay for goods and services and that means  VAT is 27% (some rates lower, like food).  That means if you see an item for $100 (all labels are tax inclusive, US showing +tax is an anomaly), the item costs $79 and the tax is $21.   That's huge amounts of taxation.  So tax is just shifted to consumption.  Fuel (for your car) is probably about $7 or $8 a US gallon.   Your life will be cheaper if you don't consume anything and never go anywhere.

Sure, you get healthcare but if you are young with no conditions, then you are paying for "freeloading" others.  This is usually an argument against socialised medicine.  I don't agree with that view as I look upon it as a kind of insurance (but it's really a tax as you have to pay it and have no choice). It's just hidden from you in the deductions the employer makes.

The HU government under invests in social services.  There's nothing you can do about that except use private medicine to improve your choice.  Don't get me wrong, I fully support socialised medicine but I'd like it to be more efficient in patient care (no queues, responsive, inclusive etc).

There's also a kind of tax in the form of inflation.  Hungary has high inflation (~10%) compared to the Eurozone (~4.5%).  It means that if you have 100 HUF in the bank, at the end of the year, it's worth 90 HUF in purchasing power terms.  Hungary imports a lot (i.e. gas/oil, food etc) so you have to  use more HUF to get say, EUR or USD to buy whatever it is you want import from overseas.   This doesn't just apply to you personally, it applies to all imports paid for in HUF and resold to you. 

One upside is that those earning in EUR or USD will find it cheaper in Hungary as they need fewer USD/EUR to get the same amount of HUF and there's a lag in the system of inflationary rises.   But all that is transient and may not last.  You couldn't base your life betting on a falling HUF.

If you have only HUF at the bank, then interest rates need to be above inflation rate to keep the value.  People are under pressure to use savings to maintain their lifestyles.  It's a bit of a pressure cooker.  What people want is price stability and the HUF isn't it.   At the end of the day, it's going to be hard for the HU government to resist adopting the EUR eventually.   Orban is ideologically opposed to the EU and EUR for his own convenience/self-interest.  It'll take a change of government to adopt the EUR and obtain price stability.

Anyways, effective tax rates for individuals everywhere have been a tad under 50% for some years.  That's when you factor everything in.   These are the numbers you need to compare, not the headline tax rate. 

You can Google all this to make comparisons.
   

    -@fluffy2560

Speaking of inflation... I do not know if you are aware of the horrifying inflation in the US? Catastrophy happening in the US right now from the over printing of money due to plandemic. Inflation in the US is killing people. People can no longer even afford food! Families are having to skip meals... inflation is horrendously bad in the US and it's not going way anytime soon if ever. It is horrible situation in the US.

Speaking of inflation... I do not know if you are aware of the horrifying inflation in the US? Catastrophy happening in the US right now from the over printing of money due to plandemic. Inflation in the US is killing people. People can no longer even afford food! Families are having to skip meals... inflation is horrendously bad in the US and it's not going way anytime soon if ever. It is horrible situation in the US.        -@juliet1980

It's the same everywhere.  US is not special post-pandemic.

Back in my own country, people don't eat so their children can, housing is crazy expensive and energy costs through the roof.   

I know some people die in the USA due to their rationing of critical medicines like insulin.  It's not something I know of happening in Hungary. And it will never happen in the UK (as medicines are free or close to free).  I doubt it would happen in Canada either.

I monitor the HU economics sometimes and I was seeing debt increasing but not as much as I would have expected considering the generally horrible economy and appalling politics.  I thought the government would be borrowing but maybe they were printing money.

There's a lot of subterfuge in Hungary, lack of transparency and more spin than an out of control satellite.    What they report to the EU could be a pack of lies.  Hard to say.  It's not like EU countries always tell the truth (i.e Greece lied to join the EUR).

Election time there will be a splurge of refunds and initiatives to buy votes but it will have to be paid for down the line.

I am self employed. Always have been. Canada's huge resources of work or job market is of ZERO interest to me. I am self employed and will always be self employed. I rather die than ever become a wage slave working for someone else. I would not even be able to afford a house in Canada! Canada is SUPER expensive with average house in the 1m range.

So I am confused why you feel I would be better off in Canada when in Canada I would not even be able to afford a roof over my head. I want simple life in the country side growing my own food like I used to, LOW property taxes and low cost of living. Canada is OPPOSITE of all that! I am not in canada for good reason. The ONLY thing good about canada is that they do not have citizen based taxation like the US. But that's the only good thing about Canada.

... and if someone renounces their US citizenship and they have stock portfolio the US will steal 30% of it. No escaping the US... they will suck every penny from you even after you renounce they hold your stock portfolio withdrawals hostage by taxing 30% of it even if you have ROTH IRA it seems? ROTH IRA withdrawals are supposed to be 100% tax free (NO tax)... but from what I recall the US will tax 30% of withdrawals from ROTH IRA once you renounce. I need to verify this info but that is what it appears to be...

    -@juliet1980

It depends what you want out of life - I personally would put Canada higher on Quality of Life  (apart from cold weather) and Australia even higher (better weather) and maybe New Zealand for a quieter life in our dotage.   Mrs Fluffy and I are driven to do whatever is necessary for our kids futures.

Yes, as they say death and taxes are the only certainties. 

I know from other contacts, the USA doesn't like people renouncing their citizenship and will make you pay for it one way or another.   

But you do have choices on places to go and other citizenships you can use.  You don't have to stay there.  Whatever punishment is handed out by the IRS on you for leaving, maybe that's just the price to pay to get away.   Others are not so lucky to have multiple options. 

    I am self employed. Always have been. Canada's huge resources of work or job market is of ZERO interest to me. I am self employed and will always be self employed. I rather die than ever become a wage slave working for someone else. I would not even be able to afford a house in Canada! Canada is SUPER expensive with average house in the 1m range. So I am confused why you feel I would be better off in Canada when in Canada I would not even be able to afford a roof over my head. I want simple life in the country side growing my own food like I used to, LOW property taxes and low cost of living. Canada is OPPOSITE of all that! I am not in canada for good reason. The ONLY thing good about canada is that they do not have citizen based taxation like the US. But that's the only good thing about Canada.... and if someone renounces their US citizenship and they have stock portfolio the US will steal 30% of it. No escaping the US... they will suck every penny from you even after you renounce they hold your stock portfolio withdrawals hostage by taxing 30% of it even if you have ROTH IRA it seems? ROTH IRA withdrawals are supposed to be 100% tax free (NO tax)... but from what I recall the US will tax 30% of withdrawals from ROTH IRA once you renounce. I need to verify this info but that is what it appears to be...    -@juliet1980It depends what you want out of life - I personally would put Canada higher on Quality of Life  (apart from cold weather) and Australia even higher (better weather) and maybe New Zealand for a quieter life in our dotage.   Mrs Fluffy and I are driven to do whatever is necessary for our kids futures.Yes, as they say death and taxes are the only certainties.  I know from other contacts, the USA doesn't like people renouncing their citizenship and will make you pay for it one way or another.    But you do have choices on places to go and other citizenships you can use.  You don't have to stay there.  Whatever punishment is handed out by the IRS on you for leaving, maybe that's just the price to pay to get away.   Others are not so lucky to have multiple options.          -@fluffy2560

The thing is that I know most people would never want to live the way I would. I NEVER leave the house, massive home body. I am not a people person. I cannot stand crowds, traffic, cities, holidays... have zero friends. My dream life is in rural setting on few acres where I live an insanely simple life growing my own food (being in nature... very healing for me!) playing with chickens and a place where I am not paying several thousands of dollars in property taxes every year and massive health care expenses every single month. The things Canada has that might make it "better" in some people eyes are of zero importance to me. I could not afford to live in Canada either way so Canada is not even an option because of that.

I understand taxes are everywhere... but for example, Sweden is not a place I would ever want to live permanently. There are different levels of taxation and Sweden, Germany etc are at levels that have gone too far. In that case I might as well live in Canada.... in a shoe box. Because that is what I could afford there.

I do like to think, where would I want to live if money were of no issue and I was wealthy... but then that fantasy is squashed because it's not my reality!

@juliet1980 So many villages in Hungary where you can live in a private place Do not go to cities, easy and cheap. Still a car for shopping is convenient. Do not complain, Hungary has loads of opporunities. What is your budget, please do not worry about taxes (property). If you do not want to have contact, it is easy (not advised by the way)

@juliet1980 Do what you think is right, but if a massive garden, do you do everythin yourself, if the is an issue with electricty or gas who do you ask. Contacts are needed (even if for a good price). In my view you can put your stance away, just a few good contacts (no friends). What are you planning in my view is not wise.

@juliet1980 Just as an additional comment, no matter where you go (foreign country) you will be ripped off, no problem for me but you have to acceot

You speak about many countries (indeed many possibilities) why Hungary (good country I agree), but there is Turkey, Russia,Gerorgia, Bulgaria,.....

Be prepared and bring enough money to survive,

My motto health is important but so is money.

    @Just as an additional comment, no matter where you go (foreign country)
   

    -@cdw057

Not true, I've never been ripped off, cos I did my homework. Saying that you can be ripped off in your home country.

@cdw057

why would i have to give up my US citizenship? i am confused, cant I have both ?

        @Just as an additional comment, no matter where you go (foreign country)         -@cdw057Not true, I've never been ripped off, cos I did my homework. Saying that you can be ripped off in your home country.         -@SimCityAT

Usually in Hungary, the price increases if they know you're a foreigner.  The language is awkward and it makes it harder to negotiate or complain.   

This is why Mrs F does all initial discussions with workers/fixers or companies. I only arrive in any discussions when we've got a lot more information and multiple offers.  I may even stay completely in the background.

It's easier in Austria or Germany as the language is more accessible.

It's just the way in Hungary.  Legacy I suppose of earlier desperate times and the misinformed concept that all foreigners must be loaded. 

I don't think it would happen in Finland, Norway or Iceland etc where the locals would be far richer than people like us. 

Example: We received our car insurance (all risks) offer (this is sold separately to the base insurance). It was 200K HUF.  It was reduced by discussion to 135K HUF as Mrs F was able to shop around and negotiate. I wouldn't have been able to do that in Hungarian.

Both Hungary and the United States accept dual nationality.

    @cdw057
why would i have to give up my US citizenship? i am confused, cant I have both ?
   

    -@angelarobbins

Yes, you can have dual nationality.  Hungary and USA allows it and so do many other countries.  My kids are dual nationals of Hungary and the UK.

    @cdw057why would i have to give up my US citizenship? i am confused, cant I have both ?        -@angelarobbins

Forgot to answer the question.

If you had some HU source income, you might want that to be taxed in HU and not in the USA where rates would be higher.   One way to avoid that obligation is to give up US citizenship.  Lots of people do it. 

Actually I knew someone born in the USA who never lived there apart from as a baby.  He lived somewhat in fear of going to the USA because according to him, he'd never (ever) submitted a US tax return.  He didn't even have a US passport but his British passport said born in Boston.  Whenever he went to the USA, they told him not to enter on his British passport and to get a US one.   He was fairly old when I knew him so him and his problem may have gone away.

I also know a Canadian guy whose daughter was born in the USA while he and his wife were working there.  Their daughter was struggling trying to renounce her US citizenship as she lived in Canada and had no intention of living or residing in the USA.  The IRS were always after her even though she was hardly more than a kid at the time.  She was an "accidental American".