Expat insights: How much does it cost to live in Italy compared to the US?

Since I’ve moved to Italy, every time I go back to my hometown of New Orleans in the United States to visit family for a few weeks, I’m shocked at just how expensive everything is. How can anyone afford to live here? Comparing the cost of living when traveling back and forth between Italy and the United States as an American expat is interesting. 

This led me to take a closer look at my expenses and figure out just how much does it cost to live in Italy compared to the US? We’ll take a look at general prices, compare the most expensive cities in both countries, and then take a deeper dive into my “hometowns” in the US and Italy.

Cost of living in Italy vs US in general

I left New Orleans in 2021 before huge inflation spikes made a considerable impact. Thankfully, I was never affected by the egg “crisis” in the States and consider myself lucky that I didn’t have to sustain the high prices experienced today in the U.S. 

Once you get off the plane and step into a cafe in Italy, you’ll immediately notice just how much cheaper things are in general. Due to sheer stubbornness of Italians to refuse overpaying for things (“An espresso for over €1?! Not possible.), or perhaps because the focus is on sourcing products locally, things are just cheaper here.

According to Numbeo, a cost of living calculator, on average, living in Italy is about 20% cheaper than in the US. This includes anything you’ll spend your money on, from gasoline and groceries to shelter and transportation. However, after living in Italy full time for a couple of years, I can attest that some things are significantly cheaper, while others are more expensive than in the United States. 

For example, the average rent in the United States is around $1,700, which is 55% higher than in Italy, where the average apartment rent is $1,100 per month. These numbers can certainly be skewed by some of the smaller towns whose populations are largely depleting because Italy’s population overall is shrinking. But from my real life observation, the cost of housing in general is cheaper across the board in Italy. 

Of course, there are exceptions to the general expensiveness in Italy. Goods like clothes, electronics, some imported cars, and gasoline are generally more expensive in Italy.

Cost of living New York vs Milano

Let’s talk about the two most expensive cities in their respective countries, New York and Milano. In fact, New York is ranked one of the highest in terms of cost of living in the world, so this is definitely going to be skewed heavily. However, Milano is quite a bit more expensive than every city in Italy, even Rome.

Overall, prices without rent are 20% to 30% lower in Milan compared to New York. Milk, a loaf of bread, local cheese, chicken fillets, and some fruit would cost you almost $50 in the Big Apple. This same set of groceries would set you back around $43 in Milan.

Public transportation, too, in Milano is incredibly inexpensive. A one-way ticket on local public transportation will cost $2.37, or $42 for a monthly pass, whereas in New York, this will cost $2.90 one-way and $130 per month. However, taxis, gasoline, and cars, in general, are much more expensive in Milan.

Amazingly, rent prices in New York are more than twice more expensive compared to Milan. You’ll find apartments in the Milano for about $1,900 per month on average and while New York rents average a whopping $4,700 per month. 

Keep in mind, though, that salaries in the cities are also incredibly disparate. In New York, the average monthly salary after taxes is just over $7,000, more than triple compared to the $1,900 average in Milan.

Despite the wages being so much higher in New York, both cities have reports of housing crises. People can’t find homes within their price range in either city.

Cost of living in New Orleans vs Rome

When I first moved to Rome, I thought things were similarly priced in New Orleans. This was also impressive to me, as New Orleans is significantly smaller, with around 375,000 people living in the city. This, compared to Rome’s 2.87 million, was surprising. How could things be so inexpensive in such a hugely populated city?

But Rome is quite spread out, so it doesn’t have the same cramped feel that big cities like London or New York have. This spread may explain, at least a little, why Rome is relatively inexpensive.

I also considered New Orleans a decently affordable city. For example, a Miller High Life beer would cost around $2 at dive bars and even nicer establishments, too. When they went up to $2.50 a few years ago, I begrudgingly paid (it’s now up to $3 to $4). 

The price of Miller High Life would be how I measured my conversion rate to other cities’ cost of living. When I paid $6 for the Champagne of Beers in New York a few years back, I almost spit out my first sip when my cousin said, “That’s really cheap!” 

Unfortunately, I haven’t found Miller High Life in Italy just yet, and as an import, it wouldn’t really be a good comparison. I suppose you can convert the beer to the cost of an Aperol Spritz, but that’s neither here nor there.

Before we get into specific costs of items, I should go over a couple of caveats. First, we moved to Rome before the huge spikes in inflation hit the US and abroad. You should expect prices for everything to be a lot more expensive now, especially in the States.

Second, we owned our own home, a “shotgun double,” and rented the larger portion of our home that covered most of our “living” expenses.

Also, some of these dates while in Rome I spent traveling or back in the US. So this isn’t an exact science, but still gives you a general idea of what you can expect.

In general, Rome is much cheaper than New Orleans. First, we’ll take a look at the average prices for groceries we spend a month.  Luckily for me, my wife is insanely organized and has a spreadsheet with what we spend.

In 2021, while living in New Orleans as a family of two with a small dog, we were averaging about $700 a month on groceries. In 2023, we spent around $400 in groceries while living in Rome. 

Keep in mind, too, that grocery stores in Rome don’t quite work like they do in the US because much of the focus is on fresh, seasonal, local produce. If you compare strawberry prices in New Orleans to Rome off-season, you’ll be able to find them at a much cheaper price in the States. However, the cost will dramatically decrease in Rome during the strawberry season.

On the other hand, we also go out to eat a lot more in Rome, too. In 2019, we spent around $690 a month in the U.S. on going out to eat. Here in Italy, we’ve spent around $700.

This includes, trips we take where we eat every meal out. In July, for example, we spent over $1,300 eating out. But this was during our yearly trip back to the US, which included a four-day vacation to Lake Tahoe for my friends’ wedding celebration.

Eating out, in general, is much cheaper here in Rome. For a Christmas party, a group of ten split appetizers, three liters of wine, a pizza or pasta per person, water, and post-dinner espressos and Amaro. This came out to be about $30 a person. In the US, a dinner like this could easily get to over $50 per person.

Also, if we have a particularly busy week, we order takeout through a food delivery app. We can get two personal-sized pizzas, two suppli, 10 small fried mozzarella balls, and two beers for around $22. This on an app like UberEats in the US would be well over $50.

Transportation in New Orleans and Rome is a tough comparison; in Rome, I rely solely on public transportation. But in New Orleans, it’s really hard to live here without a car, and this is the case in many cities across the States. 

One-way tickets are the same in dollars, at $1.62. However, monthly passes are much more expensive in New Orleans, at $45 compared to $38 in Rome. Gasoline, on the other hand, is almost 60% more expensive in Rome, at $7.47 a gallon, versus $3.14 in New Orleans.

As a US citizen, I purchase my health insurance through my wife’s work, so I spend around the same amount on this as I would in the US. Last quarter, I spent $500 on my insurance, but next quarter the cost will go up to $600. This is quite pricey, and much more than I spent in the States, though I had a Health Savings Account that I didn’t have to access much.

However, this plan allows me access to private hospitals throughout Italy, and the hospitals themselves are significantly cheaper. There are also cheap insurance plans that give access to public hospitals only for around $300 a year.

Cost of living vs. way of life in Italy

When considering how much does it cost to live in Italy compared to the US, there are outside factors that need to be addressed. One is that consumerism in Italy, and in Europe in general, is much different. 

I’ve recently read a Wall Street Journal piece talking about how much “poorer” Europe is compared to the United States. In the article, the author spends quite a bit of time comparing consumption spending and relating how poor the continent is compared to the US.

In my personal experience, quality of life is much more important to Italians than how much money and stuff they have. For the most part, they treasure leisure time and enjoy spending time with family and friends rather than buying huge homes, cars, and other items.

So cost of living is much more tricky to compare when considering the cultural and lifestyle differences. Taxes, in general, are a lot higher in Europe, but a lot of things are subsidized that aren’t in the States. The government partially funds healthcare, childcare, quality education, and more. In the US, some cities and states have higher tax burdens, but you don’t get the same return as in Europe.

On top of that, you can also argue that people in Italy live in safer and healthier communities compared to the US. The cities are much more walking-friendly, with major areas closed to auto traffic. The focus on fresh, high-quality local produce means healthier, nutrient-rich food.

You may also consider that one emergency event, a serious trip to the hospital or a car accident in the US can put you in heavy debt, then the cost of living in Italy is much less comparatively.

Final thoughts

Considering all of these factors, without a doubt, Italy is much more affordable to live in compared to the US. You’ll be in great shape if you’re making a US salary while living here. However, wages in Italian companies are much lower. 

But beyond the cost of living, there are so many factors to consider when planning a move to this fantastic country. You’ll have to decide what is most important to you.

The post Expat insights: How much does it cost to live in Italy compared to the US? appeared first on My Dolce Casa.

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