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Financial independence is significantly more challenging in the United States due to pervasive consumer culture, high taxes and associated costs like car ownership, artificial housing inflation, the impact of broken families, and expensive dating practices.
The video explores why achieving financial independence (FI) is more difficult in the United States and the West compared to other regions. The primary reason cited is the deeply ingrained consumer culture, which constantly pressures individuals to purchase goods and services to feel adequate or happy. This is contrasted with cultures where consumption is less emphasized, leading to fewer people accumulating large collections or feeling compelled to constantly upgrade their possessions. The ease of spending, facilitated by services like drive-thrus and online shopping, further exacerbates this issue.
Another significant factor is the burden of high taxes and associated mandatory expenses. In the US, car ownership is almost essential for maintaining employment, and this comes with taxes on the vehicle itself, its maintenance, and mandatory insurance. Even in areas where a car isn't strictly necessary, like major cities, the cost of living and housing can be astronomical, making relocation impractical for many. Furthermore, artificial inflation in housing markets, driven by policies that restrict supply, drives up costs for essential services, impacting everyone's budget.
The video also touches upon the societal impact of broken families, which leads to less efficient spending and a lack of familial support systems. This is particularly detrimental to lower-income individuals who cannot afford to outsource tasks like childcare or car maintenance. The rise of single-person households and divorce further fuels consumption, as individuals often need to purchase separate homes and vehicles. Finally, the high cost of dating in the West is presented as a major obstacle, with expensive outings quickly draining finances, unlike in many parts of Southeast Asia where dating is more affordable and accessible.
Financial independence is harder in the US due to a pervasive consumer culture that encourages constant spending. High taxes, mandatory expenses like car ownership, and artificial housing inflation also significantly erode savings potential. These factors combined make accumulating wealth and achieving FI a greater challenge.
Western consumer culture constantly pressures individuals to buy goods and services to feel adequate, making saving difficult. The ease of spending through services like drive-thrus and online shopping further exacerbates this issue. This emphasis on consumption directly hinders the ability to save and invest for financial independence.
High taxes and mandatory expenses are major hurdles to achieving financial independence in the US. Costs like car ownership, insurance, and property taxes significantly reduce disposable income, even with high salaries. Artificial housing inflation also drives up living costs, impacting budgets across the board.
Yes, the prevalence of broken families in the West can hinder financial independence by leading to less efficient spending and a lack of mutual support. This is particularly impactful for lower-income individuals who may not afford to outsource tasks like childcare. Single-person households also contribute to increased consumption and expenses.
Dating in the West is presented as a significant financial drain, with high costs for meals, entertainment, and transportation. These expenses can quickly deplete savings, making it a considerable obstacle for individuals pursuing financial independence. This contrasts with more affordable dating practices found in other regions.
Housing costs in the US are driven up by artificial inflation, largely due to policies that restrict supply and nimbyism. This makes it difficult for essential service workers and others to afford living in many areas. The rising cost of housing impacts everyone's budget and makes saving for financial independence more challenging.
Financial independence is harder in the US due to a pervasive consumer culture that encourages constant spending. This is compounded by high taxes, essential but expensive costs like car ownership and insurance, and artificially inflated housing prices. The lack of strong familial support systems and the high cost of social activities like dating also contribute to the difficulty.
Finding work that can be done remotely can significantly help achieve financial independence. By reducing living costs, it can have a similar impact to doubling one's income. This allows individuals to save more effectively and escape the high expenses often associated with living in expensive regions.
Property taxes are a significant expense in the US, especially for homeowners. The video highlights that owning property means paying these taxes, which adds to the overall cost of living. This is contrasted with renting, where property taxes are indirectly paid by the tenant through rent.
The video suggests that the US often leaves citizens to fund essential needs like transportation, healthcare, housing, and food independently. These costs are increasing annually, and there's a societal emphasis on individualism rather than collective support systems. This lack of investment makes financial progress more challenging for many.
0:01 Hey YouTube, Alex here, coming to you today from hot Yi, Thailand. I'm in the middle of a corn field, so let's get into it. I'm making today's video because I saw that Financial Samurai actually fell out of FI, and I'm fairly certain he's in like Boulder, Colorado. I thought, why don't I talk about why Financial Independence is harder in the West?
0:18 The first reason is the consumer culture in the West. For those who are from the US, you can attest to this. The consumer drives Western economies. Western economies have generally turned away from manufacturing and are now dominated by services, either services B2C directly selling to consumers or B2B selling to other businesses, many of which also sell to consumers.
0:42 The consumer economy is often telling us that we're inadequate, that the way that we can feel good about ourselves is to purchase something, a good, a service, a new car, a nice house. I rarely hear that, oh, I'm a collector here in Southeast Asia. It's just not as common. You don't hear about the massive car collections, you don't hear about Pokemon card collections. You just don't hear about this obsessive consumer culture like in the West.
1:10 Drive-throughs are still not a commonplace thing here. You occasionally see them in Japan or in Thailand, but it's not every business is designed for you to go and get your food as quickly as possible. McDonald's is a great example of this, where they do the majority of their business through drive-thru. Now, people like it, it's efficient, but it costs money.
1:31 One of the central tenants of the FIRE movement, Financial Independence Movement, is that people overpay for convenience. Alongside that, people often work hard to attain some physical thing. Oh, I'm saving up to buy a house, which having a house is an external multiplayer game. I want to buy this fancy car that's beyond my means. This consumption culture is to the extent that people lose the joy that they get.
1:57 I remember in a job that I had in the past where I mentioned to a manager that this is going to be my first time having a fine dining meal, and I was really excited for it. I thought there'd be some sense of like, 'Oh, hey man, good on you, you're going to have this great experience.' It was more like a smirk, like, 'This is your first time at X years old to have a luxurious dining experience?' It was like almost this sense of, 'Oh, better try harder if you're only going once, it doesn't really count. You better be doing this all the time.'
2:31 It was an enjoyable experience, but I don't base my value on how many Michelin stars I've collected. Funny enough, my first Michelin star experience was in Bangkok where I had a Michelin star experience for, I think it was like a dollar or a dollar 50, something like 50 baht, 40 baht, something like that. Really cheap, not an exclusive experience beyond just being able to get to Thailand. But nonetheless, it's not really a thing I brag about a lot.
3:00 I think this is the first time I mentioned this on my channel, but that's part of that consumer culture where you're judged based not only on your consumption, but how you can keep that consumption up. I've even heard from some Western people, 'Oh, you're not really living in Thailand unless you're eating in the finest high restaurants, you're staying in the nicest hotels.' It's bringing that consumer culture here and projecting it onto the culture here, which is not so extreme in terms of consumption.
3:22 In my opinion, in the West, it feels like there's no shortage of things to spend money on. Where here in Thailand, I basically cover my food, my transportation, and my housing, but I don't need to buy lots of stuff. I don't need to buy lots of formal clothing, I don't need to buy fancy jewelry. There are stores that offer these things here, but it doesn't seem to be as much the norm.
3:47 And now in the West, to be more efficient, they've cut the retail store out. You just sit at home and click on your computer, it gets brought to your house, which once again feeds into that consumer culture, make it as easy as possible to spend money.
3:58 Number two, the number two thing that makes Financial Independence difficult in the West is the high taxes. And I know some people will feel that this is controversial. I'm not getting into the merits or non-merits of high taxes, only to say you can't really opt out in the West. If you're from my home state, Tennessee, you're not going without a car, and a car is one of the most heavily taxed things that you can own.
4:20 Not only is the vehicle taxed, you're paying a yearly tax, some states it's based on the value of the vehicle. You're also paying tax on the oil changes, on the tires, on any kind of replacement parts. You're paying mandatory insurance, it's not something you opt out of. That doesn't get into property tax if you own a home, or you're paying rent, you're paying property tax.
4:42 So I guess your response to that could be, 'Oh, well, just go be a homeless person.' But we all know that that's not realistic for most people. Most people do not want to be a homeless person. So for the purposes of this video, it's irrelevant when it comes to the vehicle aspect. If you want to maintain a job, you're going to keep paying for that vehicle.
5:01 So what seems like high salaries, when you break down people's lifestyle expectations and desires, it gets chipped away, right? It gets chipped away by all the things you have to pay, and you have to make a lot just to stay afloat, just to maintain a normal lifestyle.
5:14 I know the next step would be people to say, 'Oh, go move to San Francisco or go move to New York City where you don't have to have a car.' And I did that. I moved to the Bay Area, had several different great tech jobs, really enjoy the opportunity there. Not everybody can just drop everything and move. I mean, San Francisco Bay Area is the most expensive, expensive city in the United States, easily one of the most expensive in the world.
5:33 And it's not something that most people have the finances set up in order to just drop everything and move there. You need a certain education, you need certain connections, you need certain skills, and those skills are rare. And that's why those jobs pay a lot.
5:48 Number three is artificial inflation. And I've talked about this in several videos before, but with the culture of nimbyism, you have artificial inflation in terms of housing. And some people say it doesn't matter, my house is paid off. It doesn't matter that your house is paid off when it comes to the wages of the people that provide you services. Fast food workers have to have a place to live. People that do service jobs have to have a place to live.
6:11 And so when the prices of those things artificially get jacked up, then that translates into more expenses for everything else. This artificial inflation would be able to be mitigated if there was a reverse of the nimbyism, but there's a lot of incentives to keep this policy up, to continue to restrict these supply housing.
6:31 This in and of itself wouldn't be an issue, but with the mass immigration policies, there is more and more pressure exerted on the housing market, making it more and more difficult for young people, especially, to get on the property ladder. Many feel that the property ladder has been yanked up from under them.
6:45 I mean, I have friends that have roommates well into their 30s. I think that America is moving toward a renter culture, and there's going to be consequences that come with people not having the pride of ownership, not feeling like they're based in a certain community for a long time. I know my grandparents lived in the same house for like 40 years. I just don't see that as being common for large swaths of the population in Western countries.
7:11 Number four, and this is going to be a sore subject for some people, it certainly applies to me, but you have both broken and small families. Families where people cannot rely on each other, can't really trust each other. There was some kind of substance abuse or personality disorder at play, and so they're more atomized than ever. This especially affects the lower classes of people. With the rich, they could just go spend the money to deal with problems.
7:34 But with the poorer people, they benefit a lot from sticking together, from being able to rely on each other for help, whether it be babysitting, getting a ride, getting work done on their car, whatever it may be. Less well-to-do people really suffer from broken families. Now you've got tons of people coming from broken families, and this is great for businesses, right? I mean, if you have a couple that gets a divorce, you're not selling them one house, you're selling them two.
7:58 No longer can they have a family car, they've got to each have a car, and this goes on and on down the list. Somebody who's working all the time as a single person, I can relate to this. I'm not as often able to go out to the grocery store and cook things for myself. As an individual, it can be just as costly to cook for one person as several.
8:15 So I end up getting takeout, which of course eats into my budget because I don't have family to rely on. I can't just go over to Mom or Dad's house and have a home-cooked meal. I've got to figure out a way to eat in an efficient manner, and it just becomes this rigoll where you have economies of scale and you can't distribute work among multiple people. It really makes it harder for people to move toward Financial Independence because they're having to spend money inefficiently.
8:39 I can relate to this. I paid well over $100,000 in rent in my lifetime, not solely because I want to live in other places, but because it was either pay rent in my hometown at 18 years old or pay rent in another city.
8:51 The fifth reason that Financial Independence is harder in the West is dating. I haven't really got into dating a lot in this channel. Dating is expensive in the West. You look at the cost of movie tickets, 14 bucks a piece, 15 bucks a piece in the Bay Area. You talk about the price of a meal, an entree is easily $20, $30. You talk about wanting to go out to a concert, 30, 40 bucks, you're paying 20 bucks for parking.
9:16 By the end of it, you spent several.
9:18 By the end of it, you spent several hundred for one date that may or may not pan out. If you're unsure about the person or they don't like you, you just threw money away. That's something that's much cheaper here in Southeast Asia. I've had dates that cost very little money; our meals together cost a total of $3 or $4, movie tickets were $4 a piece. If we wanted to go to a temple, they could get in free, or I pay a small fee. It's much more accessible when you are outside the West and live in countries where they're not trying to extract the maximum amount of money for every possible thing they can.
9:54 You also have economies of scale where something like two-thirds of the men in the West are single. Companies have less and less incentive to appeal to couples or dating. Your audience is limited to like a third of men, so it's a harder sale. I don't have any interest in dating in the West, and that's not going to change. They know a lot of guys feel the same way, so they had to shift their targeting around.
10:16 Here in Thailand, I see people on dates all the time. I see couples all the time, and it's really cool to see that. Knowing that those couples are encouraged by society to be together is wonderful. So that's another saying, that's the fifth reason financial independence is harder in the West. Yeah, you can be financially independent unless you're really well-off, you're going to struggle in the dating department.
10:36 The expectations of Western people when it comes to dating are so high that most people struggle a lot. Most people really struggle with that, and I don't see that changing anytime soon. So let me know what you think down in the comments. Has this video been helpful? Did you enjoy the cornfield backdrop? I'd be happy to come back here and film while I'm here in Thailand.
10:55 Also, do you disagree? Are any of these points nonsensical to you? I'm always happy when people respectfully disagree with me. Let me know what they think about my opinions. If you would, please give us a thumbs up; it really helps with the channel. Subscribe to the channel as well. We just hit 800 subs today, so hopefully, we'll get to 1,000 in the near future. That's my goal right now.
11:15 I think around 15% of you subscribe to the channel. I'd greatly appreciate it if you do subscribe. Thank you so much for watching, and we'll see you next time.
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