India is one of the fastest-growing economies in the world and is slotted to become the third-largest global economy by 2030, meaning your business endeavor will be a fruitful one. However, if you’re planning on moving from the USA to India, the vast differences in lifestyle, culture, and way of doing business can seem very intimidating.
I will bring in some real-life incidents to ponder over. All of the following examples are about friends/acquaintances/relatives and I will take care to keep the description anonymous.
1.Cost of living in the USA vs. India
Renting a one-room apartment in a city center in India will cost you around $200, while in the USA prices land around $1000. This is a huge difference and applies across the board whether you’re talking groceries, utilities, or entertainment.
The same goes for salary; being able to earn a similar salary in India as in the USA translates to a high standard of living in India. If you are a skilled professional, it’s possible to earn between $4,000 – $5,000 per month which is great considering how much you’ll save on living costs.
In the USA, on the other hand, you can make between $6,000 – $7,000 as a skilled professional – which isn’t significantly high enough to guarantee good savings due to the higher cost of living in the States.
There are numerous instances of people deciding to come back for child education purposes.
Higher education like MS/ Ph.D. is very good in the US but not primary education. Also, education is pretty costly to manage.
3.Nanny for Childcare
I know a guy who was very excited about the US and its lifestyle. After marriage, when the couple was expecting their baby, they wanted someone from their family in India to travel and take care of the lady during pregnancy and after childbirth.
Unfortunately, no one could travel as everyone had other family obligations. They offered to help only if the lady comes to stay with their family in India. They had to do that because affording a nanny/babysitter in the US is damn expensive.
4.Outsourcing and Racism
This guy lost his job just after marriage in the US. Unfortunately, he had a long stretch of a wait before he landed on another job (almost a year), I helped him financially through that lean period. This was during 2018.
There are other examples of things going wrong in the US. Like attacks by African-Americans in a downtown area, racism at the workplace, deep undercurrent of hatred for Indians because of fear of outsourcing. So, it is not all rosy in the US. Everything in life comes as a package, there will be positives and negatives. It is important to understand what one wants and one has to be responsible for decisions.
Life is Equally Good in India
I think life is equally good in India these days. Let me give examples,
- In 2018, I could book flight/train tickets on the internet in the US. I used to think the US is better since I can’t do this in India. Now we can do so in India.
- In 2018 I could pay my bills on the internet in the US, buy stuff, etc. Now we can do the same in India. These days I buy books from Amazon/Junglee, buy merchandise, discounts in restaurants, etc from snapdeal.
- In 2018 I could pay by credit cards everywhere in the US. Now I can do the same in India.
- I pay phone bills, internet bills, taxes, electricity bills, bank transactions, everything on the internet, I do not see a difference between the US and India.
Now let’s talk about some of the things from cost and affordability perspective.
- Cars are cheaper in the US. Refurbished cars are I good condition in the US.
- Laptop/LED/LCD etc electronics are cheaper and latest in the US. But these days I find accessories like USB drive, HDD and cameras cheap in India than the US. Samsung Galaxy S-II got launched in Asia first and 2months later in the US. iPhone 4S is launched everywhere at the same time. Some technologies are used in the US first, but that gap has rapidly come down due to the communication revolution.
- Eating out is hygienic, you do not fall sick. I see improvement in India but nowhere close to the US still.
- Human labor is damn expensive in the US, you can’t afford a driver/maid etc. I have 2 maids, I do not do household work, I think the time is better spent in acquiring knowledge, in the gym and with family than sweating out doing vacuum, mopping and cooking. People may say its not much work in the US, but it gets increasingly difficult once you have kids.
- Education is very expensive in the US. In India, if you are good enough to crack an entrance and get into a govt Engg college, you pay less than 5 times than in the US.
- High taxes (40%) in the US. In India, you have a lot of investment options to save tax. In India, it is below 25%.
- A mobile tariff is expensive in the US. In India I use postpaid mobile, STD in 199 rs all over India unlimited, ISD is Rs 1.5 for North America, and local calls 30paisa, 3G internet Rs 100 a month. No US tariff can beat that.
- Utilities– Monthly charges for Netflix/cable/satellite tv etc are expensive in the US. In India, INR 300 a month, all channels
- A broadband tariff is cheaper in India. I pay Rs 375 for unlimited 10mbps for 1 month. In the US, the 3G/4G dongles are very expensive.
- Public transport. Very little in the US. You gotta have your own car. Delhi metro is very advanced, though crowded. But the same is true in Toronto, Japan, and New York.
- Public Infrastructure. The US wins hands down. No argument here.
- Govt/Public processes/systems like acquiring passports, driving licenses, etc. I got my driving license (the electronic one) in 2weeks with Rs 275 in 2006. I had to go to the RTO office 4 times, first time to get the forms and learn the process, a second time to deposit them with supporting documents, a third time for driving test and fourth time for getting the DL. My experience was this, I faced harassment of demand of bribe, standing in the row was painful because there was no shade beyond a point. I worked around the hurdles by remaining adamant on the process and not paying the bribe, complained to a higher RTO officer, refusing to accept the offer from the brokers.
- Things are in transition, you gotta have some patience. I have an observation to make here. Indians are ok to stand in long queues in the US, but they are not ready to stand in queues in India, I do not know why so impatient in India. I had a better experience while obtaining a birth certificate for my daughter. I filled the form on the internet and just collected the certificate at the counter by paying cash.
- Crowd: I agree the crowd in India is not that civilized. Civilized means allowing elders, ladies, handicapped people to go ahead of you in queues or vacating a seat for them, being sensitive to other people in society, treating them courteously, etc. In the US, a crowd is much better (expected since more educated people are there), but I have seen them laugh/get irritated when Asian people behave badly in queues, etc. My point is if you allow an Indian ahead of you in a queue, do so with full respect, not with a sarcastic smile. In India, the bad behavior people face in hospitals, govt offices, etc is because of this crowd behavior.
- Medical facilities are better but very expensive. Medical insurance is expensive. High-end surgeries and treatments are cheap in India.
- Indian family culture and value system– India wins this one hand down. In the US, society is very formal. You may say Hi to a guy on an elevator for 10yrs and still know nothing about him.
- In India, the support system is very strong. Your kid is taken care of even if both you and your spouse work. After you get old, whatever money you may have, but you can not buy the affection and care of your blood relations. You can only get that through relationship building. Make that investment when you are young. You WILL need help to even do small household chores when you are old. We help our parents/grandparents/elder relatives here in India, our kids watch and learn about this culture. If your kids grow up in the US, they will adopt US culture. As Prasad said, you will be lonely when you get old.
- The US is not growing. I do not see a difference in a New York 5yrs back and now. But you see a big difference in Gurgaon. The salaries have not increased in the US in the last 10yrs. In India, it has gone up significantly. There are always jobs in India, in the US it is not so.
- Higher education: It is better in the US. That’s, why we are here, is not it? But this is changing slowly. Universities in India have started investing more in research and eminent profs are coming back. Though the number is still very low. I have a point of view here. Things have changed in the last few years. You do not need a Dronacharya to become an Arjuna these days. If you know how to use google and the internet, it’s all you need for knowledge.
- The reason why I am on this blog is perception. In India, if you are foreign-educated (be it from some Tom/Dick/Harry college), people give you respect. That’s the slave attitude the British have left us with. That is the reason probably, why people become so obsessed with the US lifestyle. The white skin effect. So it is strategic to have a US education if possible.
What About Money and Savings
Now let’s talk money.
Be it US, India or anywhere in this world.
A “job” mentality cannot make you break the financial barrier.
Being “financially stable” and “financially independent” are 2 different things.
- Financially stable means you have a comfortable life but you have to work for that every day.
- Financially independent means you still live a comfortable lifestyle even if you do not work i.e by having self-generating assets.
With a job, the maximum you will have in life is 2-3 houses, cars, LED TV, etc.
To really make a difference and break the barrier (becoming financially independent), you gotta think business. Otherwise, it hardly matters whether you are in the US, China, Japan or India.
Very good insights about lifestyle in India and the USA. There are a few things I disagree with and a lot of things to which I agree.
Medical facilities are better but very expensive. Medical insurance is expensive. High-end surgeries and treatments are cheap in India.
Agree – Health Care in Expensive and Insurance in Expensive. Indian’s cheap.
Here is my view. To get quality care in India, you need to pay. Poor people can’t afford to go to Top Hospitals in India. But in the USA, even you don’t have insurance, in case of emergency, you get the same quality and care as anyone else.
Child Care and Nanny
Child Care in Expensive. If both parents are working, then they have to let the new-born in daycare when mom starts working.
Its Indian Culture or Tradition to have their parents come to help when a new baby is born.
We had our son and our parents came here to help.
Our American Neighbor had a baby around the same time, their parents came to a couple of days after the baby was born, they were here only for a couple of days. then it was the mom, dad and newborn.
Pretty much that’s what happens with new parents in the USA. They don’t have parents staying with them for 3 to 6 months.
You have some investment options in the USA to get Tax Breaks. You can max out your 401(k) and IRA. In addition, if you are a homeowner, you get Mortgage Interest payments as tax deductions. If Both parents are working, then child care expenses are deductible. In the USA the tax was paid approximately 40% and in India tax is less than 25%.
I don’t know what tax dedication is available in India, but there are options to lower your income tax in the USA.
Money and Income
Being “financially stable” and “financially independent” are 2 different things.
Now very many people understand the difference. Unfortunately, in India, parents want their kids to go to Medical School or Engineering.
You don’t see them encourage kids to think in terms of an Entrepreneur.
For anyone who wants to be Financially Independent, even in the USA, working for an employer is not going to get you there unless you are in Top Management position with Millions in Bonus.
If both husband and wife work high paying jobs 100,000 to 150,000 then you can expect to save 1 Million Dollars when you retire.
With Single Income, say $100,00 to $150,000 you will still have better savings, but you have to live paycheck to paycheck. It takes a long time to save money, pay down your home loan and think several times before buying any product.
It’s easy to say, you have to start a business, but its hard work. If you are really serious about being financially independent, you need to change your mindset first.
Trust me, it will change your thinking.
What I still don’t understand is the same person is working (mostly in IT Services firm) and has been to the USA (mostly to client site).
So, it’s not ok for someone to come to the USA for higher education and work part-time, while the same person can work for American Client and feed his family and earn money, travel to the USA for a job.