America is the richest country in the world, and 2020 receipts prove it. During the peak of COVID, the U.S. saw the highest growth of financial assets due to tax cuts and an explosive stock market. But as all too many folks know, the prosperity is not very well spread out; in fact, the income gap is widening. Billionaires’ wealth skyrocketed during the pandemic, with data from Forbes finding that as of April 12, 2021, America’s 719 billionaires accounted for more than four times more money ($4.56 trillion) than all 165 million Americans on the bottom of the socioeconomic plane ($1.01 trillion). It wasn’t always this way. Back in 1990, it was the opposite: billionaires held $240 billion of the country’s wealth, while the bottom half of earners had $380 billion combined.
As the rich get richer and the poor get poorer, the U.S. is hardly the country where everyone’s dreams can come true. It is indeed getting tougher for the middle class to hold their ground, let alone manage their bills and other expenses. Could it be worse though, if you lived in another country? In other words, is the cost of living considerably less elsewhere? The answer is: Absolutely yes.
1. Australia
- Annual pre-tax income needed to be in the 1%: $219,931
- Annual pre-tax income needed to be in the top 10%: 103,376
Australia has been a pioneer in economic freedom since the dawn of the of Economic Freedom Index in 1995. In 2019, its annual GDP was $1,356.21 billion. In 2020, unemployment soared to 6.9% but has since stabilized some, now at 5.1%.
2. Bangladesh
- Annual pre-tax income needed to be in the 1%: $42,746
- Annual pre-tax income needed to be in the top 10%: $12,338
It doesn’t take much money (in American dollars) to live like a king in Bangladesh. According to the 2021 Index of Economic Freedom, Bangladesh’s economy remains primarily unfree and the opening of the banking branch to foreign competition could economically help the country. In 2020, it held an unemployment rate of 5.3% and is now hovering at 6%.
3. Brazil
- Annual pre-tax income needed to be in the 1%: $150,658
- Annual pre-tax income needed to be in the top 10%: $34,751
According to the Index of Economic Freedom, Brazil is mostly an unfree economy, and it has overwhelming debt (just like America!). Its fiscal health score is poor and it has been nearly devastated by COVID outbreaks. It holds a staggering 14.7% unemployment rate.
4. Canada
- Annual pre-tax income needed to be in the 1%: $268,197
- Annual pre-tax income needed to be in the top 10%: $107,026
According to the Index of Economic Freedom, Canada’s economy is in the upper tier when it comes to the most free. The unemployment rate stands around a dreary 8.2%.
5. China
- Annual pre-tax income needed to be in the 1%: $121,168
- Annual pre-tax income needed to be in the top 10%: $44,182
China has one of the largest economies in the world, but according to the Index of Economic Freedom, it’s mostly unfree and has been slumping in fiscal health. Its unemployment rate was about 13% as of February 2021, with many young people struggling to find work in a semi-post-COVID world.
6. Egypt
- Annual pre-tax income needed to be in the 1%: $152,424
- Annual pre-tax income needed to be in the top 10%: $39,906
According to the Index of Economic Freedom, Egypt has been improving its economic freedom score for the past three years, but it still needs to cut down on public debt and up the ante on property rights and other rule-of-law indicators.
7. Ethiopia
- Annual pre-tax income needed to be in the 1%: $35,868
- Annual pre-tax income needed to be in the top 10%: $8,381
Eight thousand bucks doesn’t go far in the U.S., but in Ethiopia it can launch you into the top 10% of earners. According to the Index of Economic Freedom, the country’s economy is mostly unfree and could benefit from a rejuvenation of its multiparty democracy. The unemployment rate in Ethiopia is currently around 2.1%.
8. France
- Annual pre-tax income needed to be in the 1%: $251,865
- Annual pre-tax income needed to be in the top 10%: $92,016
It’s still not anywhere near what you need in the U.S. to rank high (we’ll get to that later), but an annual income of $92,016 to be in the upper crust isn’t exactly pocket change — at least, not when you compare it to countries like Ethiopia. According to the Index of Economic Freedom, France runs a mostly free economy, and is working to reduce unemployment, which currently hovers at a rate of 8%.
9. Germany
- Annual pre-tax income needed to be in the 1%: $327,069
- Annual pre-tax income needed to be in the top 10%: $100,996
Even more expensive than France is its next door neighbor, Germany. According to the Index of Economic Freedom, Germany is a largely free economy, but could be even more so if the government cut down on its spending and relaxed its strict labor laws. Germany’s unemployment rate is around 6%.
10. India
- Annual pre-tax income needed to be in the 1%: $93,917
- Annual pre-tax income needed to be in the top 10%: $14,077
According to the Index of Economic Freedom, India has a mostly unfree economy, and would need ample and wide-reaching reform to improve its fiscal health. Decimated by COVID, the OECD’s Economic Outlook 2021 shows that the Indian economy contracted by 7.7% in 2020. The unemployment rate stands at around 8.7% and should be falling as infections drop.
11. Indonesia
- Annual pre-tax income needed to be in the 1%: $113,939
- Annual pre-tax income needed to be in the top 10%: $30,544
According to the Index of Economic Freedom, the Indonesian economy has been slowly rising to be a more free economy, but needs more governmental measures to decrease corruption and modernize investment regulations.
12. Italy
- Annual pre-tax income needed to be in the 1%: $207,748
- Annual pre-tax income needed to be in the top 10%: $78,923
According to the Index of Economic Freedom, the economy in Italy is mostly free, but as we’ve seen with other countries, high government spending is holding it back. One of the ground zeros for COVID when it first struck, Italy’s unemployment rate hovered at around 9.2% in 2020.
13. Japan
- Annual pre-tax income needed to be in the 1%: $240,301
- Annual pre-tax income needed to be in the top 10%: $89,643
According to the Index of Economic Freedom, Japan’s economy falls in the mostly free category. Its only major stumbling block is high government spending. In 2020, the unemployment rate in Japan held at roughly 2.34%.
14. Korea
- Annual pre-tax income needed to be in the 1%: $234,887
- Annual pre-tax income needed to be in the top 10%: $79,531
According to the Index of Economic Freedom, South Korea is a mostly free economy, with a top-notch labor force and a tremendous aptitude for innovation. But there’s still some corruption going on that would need to be addressed in order for the economy to better thrive. North Korea, on the other hand, is the least free economy in the world.
15. Mexico
- Annual pre-tax income needed to be in the 1%: $187,917
- Annual pre-tax income needed to be in the top 10%: $51,709
According to the Index of Economic Freedom, Mexico is a moderately free economy, but governmental scandals have held the country back from being in the clear. A serious revamping of governmental integrity and a cleaning up of corruption are in order. As of March 2021, Mexico had an unemployment rate of 4.43%.
16. Nigeria
- Annual pre-tax income needed to be in the 1%: $87,331
- Annual pre-tax income needed to be in the top 10%: $23,638
According to the Index of Economic Freedom, Nigeria’s economy is predominantly not free, seeing extreme political instability, policy failures and serious security threats. Nigeria’s unemployment rate has soared over the last five years as the economy endured its own recessions, and now stands at 33% — the second highest rate on the global list.
17. Pakistan
- Annual pre-tax income needed to be in the 1%: $70,024
- Annual pre-tax income needed to be in the top 10%: $16,058
According to the Index of Economic Freedom, Pakistan’s mostly unfree economy isn’t looking too bright for the future. The country faces mountainous debt and chronic corruption.
18. Philippines
- Annual pre-tax income needed to be in the 1%: $102,436
- Annual pre-tax income needed to be in the top 10%: $26,512
According to the Index of Economic Freedom, the Philippines is so-so free, but it has some significant challenges around weak spots in its judicial system and chronic corruption with slack government response. As of April 2021, the unemployment rate in the Philippines was at 8.7% — relatively low given its past unemployment rates.
19. Russian Federation
- Annual pre-tax income needed to be in the 1%: $174,753
- Annual pre-tax income needed to be in the top 10%: $44,195
According to the Index of Economic Freedom, Russia doesn’t have much of a free economy — but it has been getting better in that department. To make it even freer, the government needs to liberalize its investment code and strengthen its rule of law, among other things. As of April 2021, Russia’s unemployment rate stood at 5.2%.
20. Singapore
- Annual pre-tax income needed to be in the 1%: $627,111
- Annual pre-tax income needed to be in the top 10%: $193,352
It takes a lot of dough to be among the wealthy elite in Singapore. This is partly because the country is the most stable in the world, with no foreign debt and high government revenue. According to the Index of Economic Freedom, Singapore is ranked as the freest economy in the world.
21. The United Kingdom
- Annual pre-tax income needed to be in the 1%: $255,019
- Annual pre-tax income needed to be in the top 10%: $84,900
According to the Index of Economic Freedom, the UK has a mostly free economy, but it stands to do better through post-Brexit opportunities. In April 2021, the UK unemployment rate dropped to 4.7%, the lowest it has been since the summer of 2020.
22. The United States
- Annual pre-tax income needed to be in the 1%: $506,752
- Annual pre-tax income needed to be in the top 10%: $138,475
According to the Index of Economic Freedom, the United States is mostly free — but it still ranks at only No. 20 on the list of free economies. America’s biggest setback continues to be its high government spending and completely unfeasible levels of debt. And let’s not forget the less than fair healthcare system. As of May, 2021, the unemployment rate in the U.S. is 5.8%.
23. The United Arab Emirates (UAE)
- Annual pre-tax income needed to be in the 1%: $689,468
- Annual pre-tax income needed to be in the top 10%: $223,955
Welcome to the richest country in the Middle East — and one that requires even more bread to classify as wealthy than any other country on this list. According to the Index of Economic Freedom, the UAE’s mostly free economy could better thrive if it lessened its dependency on the hydrocarbons sector and was more open to foreign investmen.
