America vs New Zealand: Breaking Down the Numbers
Yesterday, I made a bold statement: American FIRE advice does not translate well to a Kiwi or global lifestyle.
So, let’s put it to the test - and where better to start than the one thing that can make (or break) your FIRE journey: Income.
Most FIRE advice assumes a very high savings rate – often 50% or more of your income. A ratio that is much easier to achieve with a high income. In the U.S., that is often true: bigger job markets, higher salaries, and faster growth make it realistic to boost your savings rate quickly.
Don’t believe me? Here are the 2025-2026 numbers:
Average Salaries:
USA: USD 63,000 – 67,000 (NZD 106,000-116,000)
Mississippi (considered one of the lowest income states in the USA): USD 47,500 (NZD 82,000)
Massachusetts (considered one of the highest income states in the USA): USD 80,000 (NZD 140,000)
NZ: NZD 81,500 (USD 47,000)
Auckland (one of the highest income cities in NZ): NZD 72,000 (USD 41,000)
Median Salaries:
USA: USD 62,000 (NZD 108,000)
Mississippi: USD 50,000 (NZD 84,000)
Massachusetts: USD 80,000 (NZD 140,000)
NZ: NZD 70,000 (USD 40,130)
Auckland: NZD 72,000 – 80,000 (USD 41,300 – 46,000)
Put simply, Americans generally earn more than Kiwis — which goes a long way toward explaining why those 50%+ savings rates look easier on the other side of the Pacific.
Already, we’re at a disadvantage when applying American FIRE advice here.
But maybe it’s all still doable – what if our cost of living matched our income?
Spoiler: it doesn’t. In New Zealand, everyday expenses eat up far more of your pay-check than most U.S. – based FIRE blogs assume. Rent is high, mortgages higher. Groceries and consumer goods? Not cheap either.
Many would argue that Cost of Living in America is higher, I am here to argue otherwise.
Rent – 3 Bedroom (Per Month)
USA: Vast difference from USD 300-700 (Mississippi) to USD 6,000+ (New York)
NZ: NZD 1,750 (USD 1,000) (South Island) to NZD 3500+ (USD 2,000) (Auckland)
In Auckland, a typical 3‑bedroom rental sits around NZD 3,000–3,500 per month. On a NZD 72,000 salary, that’s roughly 60–75% of take-home pay disappearing into housing alone – before food, transport, or anything fun.
Now you could argue that the same could be said for America, that living in New York would seem impossible on a median salary. And you’re not wrong. Which leads me to my next point: Choice.
With a larger job market, higher salaries, and a huge geographical area, America provides choice. You can move to a cheaper state where rent is only USD 500 per month. You can switch into a higher-paying niche without leaving the state, or find opportunities to stretch your income.
In New Zealand, the map is much smaller. High-income roles cluster in a handful of cities, and moving somewhere outside these big cities usually means accepting a pay cut. And yes, while they may be lower cost, the gap isn’t as dramatic as moving from a high-cost US coastal city to a low-cost inland state.
And of course, there’s tax – which hits Kiwis harder at typical FIRE-earning levels. At lower incomes (under USD 50k), the effective tax rates are fairly similar between the two countries. But as careers advance and incomes climb above USD 60-70k equivalent, New Zealand's progressive brackets kick in harder.
Furthermore, USA has tax vehicles that NZ lacks:
401(k) lets Americans shelter USD 23k+ annually pre-tax. KiwiSaver? Your contribution rate only.
Mortgage interest? Fully deductible in USA (up to USD 750k debt). NZ? Zero (unless investment property).
State tax arbitrage? Move to Texas (0% state income tax). NZ? One national rate everywhere.
These structural advantages mean American FIRE bloggers aren't just earning more—they're keeping more through tax code design.
I could probably talk about these comparisons for hours. Housing, mortgage comparisons, groceries, and lifestyle costs all reinforce the same conclusion and if I were to go into depth on these now, then this post would turn into a spreadsheet… and I’d rather not bore you completely on only my second day.
My bold statement stands: American FIRE principles speak a different financial language. Does this mean Kiwi’s can’t achieve FIRE? No. The principles just need recalibration.
And that’s what I’m getting to. Let’s get started…
