Chelsey Nelson, a 33-year-old from Seattle, made the big decision to move to Australia in 2021. While she’s now paying much more in taxes and adjusting to a different lifestyle, Chelsey says she feels better off financially. Her story shows some of the unique financial and lifestyle benefits Australia offers, and she believes the trade-offs are worth it. Here’s a look at Chelsey’s experience and how she’s adapting to her new life Down Under.
Meeting Her Husband and the Move to Australia
In 2019, Chelsey met her now-husband Aiden during a trip to Rio de Janeiro for Carnival. She was living in Seattle, and he was based in Australia, making for a long-distance relationship. For the next few years, they traveled back and forth to be together whenever they could. However, when COVID-19 hit, the couple was forced to stay apart for nearly 10 months due to travel restrictions.
When they decided to settle down together, moving to the U.S. was complicated. For Aiden to join Chelsey in the U.S., they’d have to get engaged, which neither of them was quite ready for, and he wouldn’t be able to work initially due to visa requirements. Chelsey found it easier to move to Australia on a partner visa, which allowed her to work right away without having to be married or engaged. So, in 2021, she packed her bags and moved to Brisbane, Australia, even though she had never been there before.
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Facing Higher Taxes
One of the biggest financial changes Chelsey noticed after moving was the much higher tax rate. In Australia, income up to AU$190,000 (about $120,000 USD) is taxed at 37%, and any amount above that is taxed at 45%. In contrast, Washington state, where she previously lived, doesn’t have state income tax, and her federal tax rate was only 24%. The initial shock of paying almost double the tax rate was significant.
However, Chelsey quickly realized that her tax dollars were put to good use. Through Australia’s public healthcare system, Medicare, Chelsey is able to receive affordable medical care. While Medicare covers most of her medical costs, Chelsey pays around $1,300 per year for additional coverage since she’s over 30. She sees the high taxes as an investment in public services that benefit her, like healthcare and subsidized public transit. Recently, her city even lowered public-transit fares to just 50 cents per ride, a small but helpful reminder of where her tax dollars go.
Retirement Savings Made Easy
In the U.S., Chelsey had to navigate retirement savings on her own, often depending on whether her employer offered a 401(k) plan. In Australia, however, the system is much more straightforward. Every employer in Australia is required to contribute 11.5% of an employee’s salary into a superannuation account, which is a mandatory retirement savings fund. This means that, for instance, if she earns $100,000, her employer contributes an additional $11,500 towards her retirement.
This system sets Australians up with a guaranteed retirement savings plan, whether they work full-time, part-time, or even intermittently. Chelsey’s superannuation has already accumulated around $35,000, giving her peace of mind about her future financial security.
Housing Costs and No Property Taxes
Chelsey recently bought a three-bedroom, two-bathroom home for over $1 million, located about 15 minutes from Brisbane’s city center. She notes that housing prices in Brisbane are comparable to Seattle’s, and while the home is modest, it suits her and her husband’s needs.
One of the financial perks of homeownership in Australia is that homeowners don’t pay annual property taxes. Instead, they pay a one-time stamp duty tax when purchasing the home, which in Chelsey’s case was AU$36,000. While this fee is high, Chelsey feels it balances out in the long run. She figures that after about five years, the amount she paid in stamp duty will be equal to what she would have paid in property taxes in the U.S., and she won’t have to worry about rising property-tax rates. This predictable, one-time fee offers Chelsey a sense of stability that many homeowners in the U.S. don’t experience.
Uncertain About Starting a Family
While life in Australia has many perks, Chelsey is still uncertain about having children. Although the cost of childbirth and basic medical care would be covered by Medicare, Chelsey worries about the long-term costs of raising a family, especially when it comes to education, childcare, and extracurricular activities.
Even though both Chelsey and Aiden make six-figure salaries, she’s concerned that two children might strain their budget. Additionally, Chelsey feels that having children might affect her career, a common worry for working women worldwide. For now, she’s undecided about whether or not to start a family, balancing both financial and personal considerations.
Generous Time Off and Paid Holidays
One of the benefits Chelsey most appreciates about working in Australia is the generous amount of time off. She receives four weeks of vacation, two weeks of sick leave, and 10 paid public holidays each year, as well as a paid day off on her birthday. This adds up to almost two months off each year, far more than she received in the U.S.
Chelsey also has access to unpaid leave and recently took 4 ½ weeks off for her wedding. Her boss even encouraged her to take another three weeks off for Christmas, reflecting the culture of work-life balance that Australia promotes.
Weighing the Pros and Cons of Life in Australia
While Chelsey is now paying higher taxes and faced with high housing prices, she feels financially secure and supported in Australia. The predictable costs of homeownership, healthcare, and retirement savings have provided her with a strong foundation that was more challenging to build in the U.S.
Additionally, her quality of life has improved, thanks to the additional time off and support for her health and well-being. For Chelsey, the advantages of living in Australia outweigh the drawbacks, allowing her to live comfortably while saving for the future.
Chelsey’s story highlights how the differences in financial systems and public services between the U.S. and Australia have a real impact on daily life. For those considering a similar move, Chelsey’s experience shows that while higher taxes may initially seem like a disadvantage, the benefits can make it worthwhile.