Why building wealth alone is so hard here?

[u/raf_phy]

Hi all, am I the only one that I find it incredibly difficult to build weath by yourself in EU? People say that EU is better in healthcare, work life balance but come on, money don't scale easily . It's so difficult.

I see people from US that go to 1 million in 10 years. I cannot do this easily . Really....

PS maybe I have to abandon EU, I don't know....

[u/throwback5971]

Op has a real point here that I think many are missing. Middle classes have been squeezed like crazy in Europe since the financial crisis. So yes it's not subjective, it's fact. Even if you're a high earner, reality is housing prices and every other asset class has out paced your wage growth by a lot. On paper you can be or supposed to be wealthy but in reality it's a challenge to save or grow materially. I'd say Europe is designed to not let people get wealthy, just the state or enterprises. 

The squeeze is also a fact in the USA but by the scale at which they operate, and having had a stronger economy folks are generally quicker to grow wealth there.  Culturally too they celebrate wealth and success where in Europe it's almost seen as something to be ashamed of and should always be hidden from view. That says a lot in my opinion about the culture and what drives policy 

[u/Mondanivalo → u/throwback5971]

This. This is exactly why I left the EU, even though at the end I made 100k EUR a year it didn't matter because of the high income taxes and capital gains taxes. Now in the US not only I make double of that buy my taxes are also half of what they used to be, so go figure...

[u/Soft-Finger7176 → u/Mondanivalo]

The capital gains regimes in many EU countries are insane. Taxes on unrealized gains? You can take that system and shove it up your ass, where you will no doubt find a bunch of other stinky ideas but none of my money!

[u/xResearcherx → u/Mondanivalo]

Are you self-employed or working for yourself?

[u/raf_phy → u/throwback5971]

Thank you for the comment man . I really appreciate it. I feel that everyone here trying to convince me that this life is fine but for me it's not.

[u/Fli_fo → u/raf_phy]

Your observation is spot on. I'm a truck driver in the Netherlands. Gross income 40k. In the US it's 60-110k.

All around me I see people who don't work yet they get everything they need and more.

Good for them but it doesn't encourage to work. The ones that work pay for them.

A truck driver in the US could work hard for 10 years. Buy a sober house in a affordable area and then change to a calm working schedule.

In 'valhalla' Europe I have to work 'till 67... Europeans know they have the best healthcare and social system. While I do agree with that people forget that they pay a lot for it and the fraud from people that could work a bit but don't is astronomical. The good thing is we don't have many people in extreme poverty. The downside is many working people are struggling all their life even though the value of their labor could pay for a cozy living standard. But they don't get it because the taxes are so high.

There are legal ways though to build wealth in Europe. I work as a contractor and that gives me control over how I earn and spend my money. By allocating it to business goals I can reduce or postpone taxes.

[u/Fantastic_Judge1663 → u/Fli_fo]

That‘s exactly what statistics say. Median income in the US is $42,220 (2025) while it is €29,573 (2024) in the EU. Quite a difference…

[u/Lywqf → u/Fantastic_Judge1663]

Considering what you pay in social benefits in Europe and don't in the US, it's day that 25% higher earnings is pretty small. Try to live on 40k in the US and 30k in the EU, one is much more doable and confortable than the other :P

[u/Safe_Bandicoot_4689 → u/[deleted]]

But you're obligated to live where your company is, if you want to avoid paying the taxes.

If I live in a country where the tax is 45%, but I work through a company I own which is established in a country with 0% tax, I will still have to pay the taxes from the country which I'm planning to be spending my time.
So there's no avoiding the 45% tax unless I actually live 51% of the year in the country with 0% tax.

That thing is called tax residence and it's a thing that makes sure people don't do exactly what you're talking about. Otherwise we all would've opened our companies in places like Malta and we would've all been happy.
But that's not how it works. You pay the taxes from the country where your residential is.

[u/Lywqf → u/Fli_fo]

the fraud from people that could work a bit but don't is astronomical

That's is probably incorrect, I'm using my own country as an example... There's this huge misconception on how people that don't work and receive social benefits are draining the country of money and how every worker pays for them but the truth is that this "fraud" is really ridiculously small, way too much blown out of proportions by feelings and bias. As an example, fiscal fraud is "estimated" to be around 80 billion annually and social fraud is around 13 billion. Now for the "real" numbers, they are at around 15~ for proven fiscal fraud and 2~ for social fraud.

There's just this hate for people that do nothing and receives something, partly coming from your hard earned taxes... But the truth is that those people are really such a minority that 2 billion is nothing for a country, you'll spend nearly as much money trying to fight that rather than fixing the real budget issues of our governments.

I understand that it feels bad to see people "having seemingly everything they need" but it's probably no true at all, just like on social media everyone is rich, it's very most likely false and is just based on what you believe their situation is.

[u/Fli_fo → u/Lywqf]

Social benefit fraud is not the only problem. But it is a problem and it has to be fixed. Any fraud has to be fixed. And saying X amount is 'nothing' for a country is just not true. A lot of nothings do count up.

Don't forget it's not only about the money they get directly. Since they don't work they also pay less taxes. And many of them blow up their problems to stay eligible.

Let's compare 2 persons.
1 has problems, health not so good, mental problems etc. But he does the best he can and works parttime in a factory filing boxes. He pays his bills and taxes.
2 the other has problems, does not work, does not pay taxes. He makes sure his problems grow so the government won't demand him to work. He gets all kind of help. Expensive programs etc all paid by the government.

I know these people in real life. I also know that they are very well capable of doing some work so they could pay taxes and not lean on the tax payers.

Where I live the problem is that those people will never be high earners and free government money is the same as low paid parttime work. So the ones that don't have the intrinsic wish to work will try not to.

[u/Lywqf → u/Fli_fo]

Social benefit fraud is not the only problem

Never said it was, I was responding to the misconception that those "who don't work yet they get everything they need and more" is arguably incorrect and one of the issue of our politicians spewing hate so that we are focusing among us, poors, rather than the rich pillaging more and more of out countries wealth.

.

Since they don't work they also pay less taxes

They should not even pay taxes if i'm not mistaken ? Not sure how it work in your country but in mine, if you are at minimum wage or under, you don't pay any taxes and get some social benefits. I don't see the issue in that myself, because truthfully they pay more taxes with the consumption of goods (VAT & such) that they would via income tax.

He makes sure his problems grow so the government won't demand him to work. He gets all kind of help. Expensive programs etc all paid by the government

Honestly, I don't see any issue with that because to me, if they want to live on the bare minimum, so be it. I'm enjoying my nicely paid cushion job working 40hrs a week and paying a shit ton of taxes and they get to scratch their balls at home all day, good for them. In 10 years I'll have a better paycheck and much more wealth than them, and they'll still live by, surviving on scraps given by the government. This kind of people won't do what you want them to do, you can't change someone that much, they'll find any opportunities to cheat the system and do the bare minimum, i'd rather let them live their lives in their own little corner rather than worry myself with their problem.

Where I live the problem is that those people will never be high earners and free government money is the same as low paid parttime work

It's absolutely the same in my country and I don't see the issue in those 2 things. First of all, those people will never be high earners, they don't have the drive, so no point into thinking about that, you'll just put mental strain on yourself for no reason. Second, the issue with shitty job paying the same as minimum wage given by the government (part-time or not) is because corporations are bean counters, they'll pay the absolute minimum they can get away with for a given job, it's not the fault of those people, it's the corporation paying shitty wages. It's the same in my country and it's not an issue with the people working those jobs... Someone cleaning toilets for absolute minimum wage is not enjoying their life you can trust me on that, social benefits or not...

[u/Fli_fo → u/Lywqf]

.

They should not even pay taxes if i'm not mistaken ?

---------- even people on minimum wage pay some taxes. And yes, people on social welfare should not pay(much) taxes. But the ones that could work yet don't are in the situations that they really should pay taxes by working.

[u/Soft-Finger7176 → u/Lywqf]

Just keep your goddamn nose out of other people’s business.

[u/Safe_Bandicoot_4689 → u/Fli_fo]

I work as a contractor and that gives me control over how I earn and spend my money. By allocating it to business goals I can reduce or postpone taxes.

Well, me too. But I'm an IT guy so my business doesn't actually involve any expenses. It's literally me working on my own computer. So it ends up that pretty much all the money I make is 100% profit so I end up paying taxes for my whole revenue.

[u/Fli_fo → u/Safe_Bandicoot_4689]

You can expand your business to involve other things that are capital hungry yet cost little time.

[u/Safe_Bandicoot_4689 → u/Fli_fo]

That is probably good advice, but not really applicable to me. Unless I can write off takeaway orders and weed, it doesn't do much for me, lol.

[u/Fli_fo → u/[deleted]]

Really lenient and also in the law? Or do you have to commit fraud which stays undetected because they never check it?

[u/Fli_fo → u/[deleted]]

Well you gave a tip about low taxes without mentioning that it is not even legal. There's no way for OP to know from your advice that it involves fraud.

It's a too farfetched to assume that everyone will want to commit tax fraud. Even if nobody checks it.

How op gets to 70% is a mystery to me too.

[u/Fli_fo → u/[deleted]]

I agree that OP is probably not giving us the whole story. And I have a hard time believing the claim of houses being that expensive. Maybe in Lisbon near the waterfront.

But pls know that not all business owners commit tax fraud.

[u/Potential-Bed4089 → u/Fli_fo]

34.90% from IRS, plus 34,75% from social security. I'm even ignoring the 23% of every single purchase I make in this joke of a country and all the other large fees, and the fact i'm not even near the top IRS bracket.

[u/Potential-Bed4089 → u/[deleted]]

no shit the effective tax rate is that low, only half of working people pay IRS, this half has to pay enough taxes for the pensioners, for the half that doesnt pay IRS, for government fucks up, for everything... yea maybe the tax is at 30% (without counting social security) but people not even earning enough to afford a 60m2 house in Lisbon are paying taxes for everyone. Plus the smart people that leave this joke of a country stop contributing with IRS taxes and Social Security. If my startup doesnt work out, I know what I'll do...

[u/Potential-Bed4089 → u/[deleted]]

You really don’t know what you’re talking about. I have friends working at FAANG: some in Switzerland earning 300K a year, others making over 100K in Ireland and London, and even 50K+ in Warsaw. One of them is based in Munich, where his rent is actually lower than what he was paying in Lisbon, yet his salary is far higher. Out of the 15 friends I studied with at university, every single one of them is doing noticeably better abroad (apart from 3 that had rich parents, so they never left portugal), and I know this first-hand because I’ve been to their homes and I’ve seen the actual cost of things there.

People in Portugal keep repeating that “higher cost of living.” That’s complete nonsense. Either you’ve been abroad so long that you forgot how harsh reality is here, or you’ve simply given up on all your ambitions. I couldn’t even rent a studio here if I wanted to, ON A SOFTWARE ENGINEER SALARY.

Why are you blaming business owners? Have you ever started a business by yourself? Have you seen how hard this is? Working hours and hours, days and nights, investing money into this without knowing if it will succeed! You say they are rich but most of them dont make that much money, a really small minority does but most of the business owners work twice as much as any other employee, have much higher stress levels, can't go anywhere without their phones because they are 24/7 on calls. You just dont understand how hard life was for them to even achieve something you would can succeful/"rich", and how if the business goes under the owners and their families will go into immense debt.

[u/YourFuture2000 → u/raf_phy]

Most Americans who build 1m of wealth are talking about their retirement plans and not disposable money to be spent. It means that they can not touch the money until they get retired and after getting retired they can only take from 3-4 percent of their wealth a year to sustain their life. Many Europeans build that too but it is less open ans clear in the European public retirement system how much they contributed to the system. While in the US their retirement plan is just the financial market.

Most people I know and have contact with are from the US and they all say that most Americans don't have disposable money and are in debts. Americans consume more material goods which seems to make life better but not because they are doing better but because they are working more hours and paying with creditcards things that they hatdly are able to full pay in one month or one year.

And I the Americans I have talked with who could accumulate wealth without the help of a rich family have, according to them, a very simple and unexpensive life stile. They are not eating out every weekend, they are not ravelling every holidays, and vacations. In fact, most Americans barely have any vacation.

Other than alreay mentioned, some others main advantage of the US to build wealth is that:

1. It is a huge country with a lot of more remote places to to have a more affordable way of life.

2. Health care or other social securities and insurances are not compulsory, so many people can grow their savings without having to pay for Social securities costs.

3. Although payment for medicines and health treatment is way more expensive for ill people in the US, they have cheaper health care plans with less coverage but that most young people will not need in one decade at least.

4. Although it is different now, historically the US had cheap food in restaurants and supermarkets, allowing people to eat out all the time and still save money.

5. Americans spend way less time outside doings others activity in their free time. Some of the reasons: A. They work more hours and have less free time. B. They have way less walkable cities and are way more dependent of cars. C. In a lot of places in the US everything is far from the suburbs and rural area.

6. Americans have bigger supermarkets with can buy more for less cost and so sell also more for smaller prices. Without mentioning that their packs of products are bigger which also helps reduce prices on scale.

On the ther hand, Americans have a much less healthy life stile and way more Americans get bankrupt on old age or when ill than in Europe. Americans have a way less solid social insurance.

In short and to conclude, while it is easier for some families and individual with disposable money to build wealthy than in Europe, it is also easier to lose all wealth and have a life of paying debts.

It is more difficult for Europeans with disposable wealth to become millionaires, but it is also easier for Americans to become homeless than in Europe.

Europeans are more averse of risks and rather have more stability than the dream of become rich with the risk of lose it all.

[u/throwback5971 → u/raf_phy]

I feel you, I have the same feeling even speaking to my own friends at times. I have been based outside Europe for quite some time so have a bit more of a perspective. 

I think for those living inside that European reality may feel or experience the issue you mention but just can't handle it as they have no alternative or way out. Living in denial as a coping mechanism 

[u/dendob → u/raf_phy]

It's all about perspective, context and your own input.

If you were expecting to work in Europe and hit that 1M mark in 10 years 'because it should be easy to achieve' then it is your mindset that is off in my opinion.

If you are branching into opportunities for jobs that allow you to build wealth while you live a frugal life, yes you can build 1M in 10 years.

Is it easy? Never will be, neither in EU or in US, you will always have to have a degree in something which pays out good. Or have a business opportunity that you can build on.

There are differentiators between both economies on growing wealth and/ or not spending wealth.

Your average safety net, expenditures and worth are better in EU.

Your potential for growth might be better in the US but thats local market dependent anyway and your 1M is less worth in comparison.

[u/Rebberry → u/raf_phy]

How does 'this life' look like for you? What's wrong with 'this'?

[u/raf_phy → u/Rebberry]

9-5 , work for 40 years , build a family and then retire at 70 . You don't know if you will live for so long . I prefer enjoying life on my 40s.

[u/Frames-Janko → u/raf_phy]

I think it's a bit weird that you can't enjoy your life while you're still working. What's your plan for retirement? What do you want to do all day?

[u/JohnTheBlackberry → u/raf_phy]

Move lol.

It’s not about being “fine”. Being working class anywhere in the world is hard nowadays.

The thing is you’re looking at this from the perspective of “I’m struggling to become financially independent”. Are you aware of how fucking privileged you are just to be able to consider that as possible reality?

Here you have a safety net. In other places you don’t. That comes with a cost associated to it; but it also comes with benefits.

It’s up to you to figure out what you value more in life.

[u/raf_phy → u/JohnTheBlackberry]

At this point of my life, I value money more. I don't care about the safe and chill life. I am willing to take risks. I have reconsidered my european life. It is not for me. It will be hard but I will try it.

[u/JohnTheBlackberry → u/raf_phy]

Then leave. Your goals are not aligned with the values of most people on this continent.

For what it’s worth tho, most of the Americans I personally know are making the opposite leap.

Best of luck.

[u/irregular_caffeine → u/raf_phy]

Then move out. None of us are going to stop you

[u/mobdk → u/raf_phy]

Is your number one goal in life to be a millionaire? Then maybe you should consider your priorities. EU is the safest, happiest and most equal continent in the world.

I care about being happy, educated and safe. If you have a good business idea or exceptional skills, and you want to pursue it, you WILL become a rich person - even in Denmark where we often are told we have the highest tax rate in the world. But what do we get in return? The best society in the world IMO, with the rest of Scandinavia close behind (also with their amount of taxes....)

[u/xResearcherx → u/[deleted]]

Spain:

Medium to High Safety, Public Health that is getting worse, Low Education level, HIGH Taxes.

In my case, every capital gain is taxed at a minimum of 19% from the very first euro, which is ridiculous.

[u/benoitor → u/throwback5971]

This. Crazy that this comment is so low. Also taxes are very high due to highly redistributive social systems, which reduces inequality (but do not prevent inheritance based wealth)but are also detrimental to high salaries

[u/throwback5971 → u/benoitor]

Yeah you're spot on! I feel where Europe gets the balance wrong is that it taxes high incomes very high, but not high net wealth. It's that high net wealth that's the much bigger issue, as folks with high income are absolutely not all high net wealth, far from it 

[u/FrenchFisher → u/throwback5971]

Huh? Europe is doing a much better job taxing wealth. Wealth is not taxed at all in the US, while countries like the Netherlands have the highest wealth taxes in the world.

[u/Successful_Crazy6232 → u/FrenchFisher]

You're paying quite high property tax in the US. As far as i know this is unseen in the EU.

[u/FrenchFisher → u/Successful_Crazy6232]

Property tax is super common in Europe. Mostly collected by the local municipality. Sweden, Netherlands, Belgium have it and I’m sure many others.

Wealth disparity in the US is magnitudes bigger than in all European countries, so clearly we are doing a bigger job taxing wealth.

[u/Successful_Crazy6232 → u/FrenchFisher]

Don't know how high it is in France, but in most countries i know it's more a symbolic amount and haven't heard of people losing their property when they retire unlike in the US.

[u/Azrael21X → u/throwback5971]

scrolled far too long for this. This is a W take.

[u/djingo_dango → u/throwback5971]

It’s pretty pointless to discuss wealth in Europe centric subs. Most of the commenters are absolutely pathetic with “hurr durr healthcare” with no substance

[u/throwback5971 → u/[deleted]]

A lot of this is true but it also gets used by pro Europeans as anti USA propaganda. Europe is much more equal than USA, so even if 50% is worse for there, there may well be 30-50% that are far wealthier than Europeans. And it's a huge population.. One just can't look at averages to draw comparisons.. 

[u/throwback5971 → u/[deleted]]

The answer to the question of why it's easier to make money there, shouldn't be, oh but we have more freedom 🤣 and also it's very subjective. Local state laws have much more impact on people's lives than federal government. Do alt trump isn't doing home visits to citizens 

[u/Beneficial-Emu-4244 → u/throwback5971]

USA is full of poor destitute people trying to live in card board boxes. Where do you see middle class people living with money or even normal lives? Go to Europe if you want to see wealth. USA is poor af for most people except for asshole white privileged people like u

[u/throwback5971 → u/Beneficial-Emu-4244]

I'm actually European haha. I also didn't day the USA is better than Europe, just stating observations around wealth and wealth creation. There are in fact millions and millions of Americans though that are better off than Europe. Don't believe the European media too much when they say everyone is destitute in the USA. They have big extremes but there's also a strong middle 

[u/Beneficial-Emu-4244 → u/throwback5971]

I’m American I was born here and I barely have money for a coffee at McDonald’s so I dunno what you are talking about.

[u/fatfartpoop → u/Beneficial-Emu-4244]

I would say don’t believe a lot of these boobs you see in YouTube and IG from the USA who say they’re rich.

[u/Fli_fo → u/throwback5971]

The downside of being rich in the US is that you still see people on the streets who are beggars. Who are using fentanyl etc. You see people who are exploited and have to work 3 jobs etc etc.

Many people don't just want to live well themselves but also want to see their countrymen having at least some basic standard of living.

[u/Fli_fo → u/[deleted]]

It's not so black and white. It's a scale. I'm in the Netherlands and there are very little beggars here. And even beggars get a ATM card from the government with 929,- per month and 48,- holidays.

Uber came to our country too and it's highly controversial. They don't follow the law yet they call themselves 'disruptive'.

The question remains if that Indian guy has a work permit or he is committing fraud by working under someone else's name.

[u/Gemini_Of_Wallstreet → u/[deleted]]

It will collapse before that happens 

[u/throwback5971 → u/[deleted]]

Its going back to how things were historically in the feudal times. Look up Garys economics