When we started our European sabbatical in 2009, we had a very strict budget. The exchange rate between the dollar and the euro was $1.25 to 1 euro, and we planned out our money accordingly. Well, all that went out the window a few short weeks later when the euro rate jumped up to $1.50, so we adjusted our expectations for how much we were spending.
The best advice was from our friend Claudio in the Cinqueterre in northwest Italy. He said, “You have to stop converting the money into dollars in your head and just think of it in euros.” If you keep converting to dollars, you will make yourself crazy because it will seem that things are becoming more and more expensive with the fluctuations in the exchange rate. In reality, a euro is a euro is a euro.
This mantra has ruled our travel life ever since, and now, regardless of the exchange rate, we just think in euros. Especially since we have learned more about hourly wages, the price of things have more meaning. (Italy doesn’t legislate a minimum wage, but currently the typical hourly wage is around 9 euros compared to the US minimum wage of $7.25.)
In our village, we pay for most things with cash – a coffee at the bar (one euro), a few items at the grocery store, a loaf of fresh bread at the bakery (1.50 euro), a bottle of laundry detergent at the tabacchi (the multi-purpose store that has everything from groceries to jewelry to toys).
This laundry detergent was 2,80 euro – much cheaper than the US
Most places in Italy do take credit cards, but cards are not as commonly used as they are in the States. Plus, the cost of living in Italy is very affordable, and if you’re popping into a little shop to buy just one thing for one or two euros, it is weird to pay with a card.
We’ve learned that, in Europe, luxuries are expensive but daily necessities are cheap. For example (and I will convert to dollars here in order to make my point), gasoline is a bit of a luxury. Gas is currently 1.85 euros/liter which is $6.80 per gallon. Wine, on the other hand, is a necessity, and a five-liter jug of decent white table wine is 5 euros. When you consider that a bottle of wine is 750 ml, this translates to about 80 cents per bottle.
Groceries are also very affordable. A six-pack of free-range eggs at the grocery store is 2 euros. A half-liter bottle of whole milk (for my hot tea in the morning) is 89 cents and is the perfect size considering how little I use each day. And check out this bundle of broccoli that we got for 50 cents from our village grocery store:
we bought this broccoli in our little village for 50 cents, best broccoli of my life – wine bottle for scale
Health care in Italy is also way more affordable than in the US. I recently read a magazine article written by a British woman who had moved to Italy. After moving here, she was diagnosed with breast cancer and went through surgery, follow-up treatment, and reconstruction. She paid 40 euros for the initial mammagram, and then everything else was free.
Compare this to my experience two years ago when I got up in the middle of the night to go to the bathroom, tripped in the dark and hit my head, and had to go to the hospital to get stitches. It cost $2,300 out of pocket. (Chad and I have a high-deductible health insurance plan which, believe it or not, is cheaper on an annual basis than a more comprehensive plan, even with an event like getting stitches in the middle of the night.) So for everyone in the US who is obstinately against socialized medicine, please do a little research.
Perhaps my favorite observation on the topic of Money is the design of the euro currency itself. For paper bills, they are each a different size and different color depending on denomination. The 50 is bigger than the 20 which is bigger than the 10 which is bigger than the 5. Genius! Plus, the bills have images of building elements such as windows, bridges and aqueducts so, as an architect, I was smitten at first sight.
paper bills and coins
architecture!