8 Things Americans Pay Way More for Than Other Countries Do
Written by
Cindy Lamothe
Edited by
Chris Cluff
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
When people think of the American Dream, they picture a large house with a white picket fence and all of the commodities that come with it. They also might tend to imagine things as being more affordable. But that’s not always the case.
Jonathan Rosenfeld, founder of Rosenfeld Injury Lawyers, said he often witnesses the financial burdens faced by the most vulnerable members of society.
“It’s disheartening to see how certain essential goods and services are far pricier in the United States compared to other countries,” he explained, noting that this only worsens the economic challenges families already face.
Below are the top things Americans pay way more for than people in other countries do.
Healthcare Costs
U.S. healthcare is notorious for being significantly more expensive than in many other developed nations, Rosenfeld said.
For example, health spending in the U.S. averaged $12,914 per person in 2021, according to National Health Expenditure. That was about $5,000 more than the next most expensive affluent nations. And the U.S. doesn’t even have universal health coverage, like most of those other nations do.
The sky-high prices of prescription medications can make it especially difficult for people dealing with injuries or other health issues.
Rosenfeld said this not only affects the ability of people to access necessary medical care but also decreases their overall well-being.
Prescription Drugs
If you’ve ever experienced sticker shock at the pharmacy when filling prescriptions, then you know the cost of medications can be astronomical in the U.S. For many, it’s frustrating to know that the same drugs are often cheaper abroad.
In 2019, the U.S. spent more than $1,000 per person on prescriptions, according to the Organization for Economic Cooperation and Development (OECD). That was more than any peer nation.
Similar to the burden of healthcare costs, the U.S. still asks its constituents to pay more for prescription drugs, said Joe Chappius, financial planning and tax expert at TaxClimate.
“Healthcare, in general, in the U.S. is already expensive,” he said, “but it doesn’t stop there.”
He pointed out that pharmaceutical companies set their own prices. “They take advantage of the drug patent system to limit their competition and keep prices high.”
Housing
According to Chappius, we shouldn’t overlook the cost of housing in the U.S., which can be considerably higher than in other nations.
The average home sale price in the U.S. was $495,100 in the second quarter of 2023, and Chappius said this is due to many contributing factors, including limited housing supply vs. high demand.
“Unlike in other countries that have extensive housing programs, the burden of homeownership is on the homebuyer alone, leading to higher upfront costs,” he said. “This doesn’t necessarily include the property taxes and maintenance expenses yet, which add more costs.”
Goods and Services
In other countries, taxes are already added into the advertised prices. The U.S. works on a system where sales tax is added up when you purchase something.
Chappius said this lack of transparency means higher prices at the checkout counter, with people realizing the actual cost only after the tax is applied — making affordable goods and services more expensive for some Americans.
Aside from this, high inflation also plays a significant role in driving up prices. The typical American household spends about $768 more monthly on goods and services these days compared to 2020 because of high inflation, Mark Zandi, chief economist of Moody’s Analytics, told USA Today.
Higher Education
Many who have spent time researching colleges are shocked at the tuition fees in the U.S., which have blown up over the past couple of decades.
The United States now spends more than $30,000 per student — double that of the average OECD nation.
Seeing students saddled with substantial student loan debt after graduation is that more frustrating for many, given that higher education is often free in other developed nations.
Cell Phone Plans
Compared to friends and family living in other countries, Americans often pay more for mobile phone plans, with limited data and fewer perks. For example, India has the cheapest unlimited text plan: $2 per month. The U.S. has noticeably higher rates of up to $20 per month.
Child Care
For many Americans, finding affordable child care is a real struggle. The cost of daycare and early childhood education programs can be a significant financial burden for families, especially in urban areas. According to The New York Times, rich countries contribute an average of $14,000 per year for a toddler’s care, compared with $500 in the U.S.
In Denmark, parents pay no more than 25% of the cost of having their 2-year-old attend child care. That child is also guaranteed a spot until age 10, when after-school care takes over. More surprising? If you choose to stay home or hire a nanny, the government will help you pay for that as well.
Public Transportation
Americans spend about 17% of their household budgets on transportation, according to the U.S. Bureau of Labor Statistics. That’s a larger portion than people in Europe, where about 11% of household expenditures go toward transportation on average, according to the Institute for Transportation and Development Policy.
There are some cities in the U.S. where owning a car is essential; but, for those who can’t afford it, public transportation can also come with a hefty price. Those who reside in European countries, on the other hand, can find public transportation systems like buses, trams or trains with lower fares. Some are even free. Spain and Malta, for example, have launched free travel options.
More From GOBankingRates
