Lifestyle

Why You CAN Become Financially Independent In France

When the FIRE movement lectures geoarbitrage and relocating to Costa Rica - you CAN retire early in France

You don’t have to be a millionaire to live a life of financial freedom in France, even on the French Riviera.  Whether you make your money overseas and then move to France or move here to begin your FI journey – it is 100% possible without hardship or self-denial.

How much money do you need to live a ‘decent’ life in France?

Let’s say you want to build up your savings in your home country and then move to France for ‘the good life’. How much do you actually need?

Of course the answer is ‘it depends’. Do you want yachts, fancy restaurants and the penthouse? Or do you want a good baguette, healthcare sorted and the great outdoors?

Whichever is your dream life, you do need a benchmark. Helpfully, the French government keeps tabs on what a decent life costs. 

Last year they released an updated report. Here are the monthly thresholds for 2022:

  • Working-age person living alone: €1,634
  • Working-age couple without children: €2,273
  • Single-parent family with two children: €3,003
  • Couple with two children: €3,744
  • Retired person living alone: €1,836
  • Retired couple: €2,540

If you are lucky enough to own your own property in France then deduct around €523 a month if you live with children, €455 if you’re retired, and €332 if you live alone.

What is considered a ‘decent’ life in France?

The official benchmark for a decent life in France doesn’t just include the necessities like housing, bills, clothing and transport. To live a decent, and happy, life you need a social network. 

So, the government calculations also include one French gîte holiday per year, restaurant meals, cinema tickets and buying presents to maintain friend and family links.

Should I make my money in my home country and then move to France?

Now you’ve got a good idea of the cost of living in France, you can work out how much you’ll need to stash away for you to be financially independent. 

For us, at The Daily FI, being financially independent means all your living costs are covered by passive income (usually savings and investment interest) so you don’t have to work if you don’t want to. Your FI number is the amount of money you need stashed away to give you that passive income.

You might think it’s easier to keep working in your home country to save the money you need to hit your FI number. Well, it may be easier in some ways but more painful in others. 

You may be working ‘just a few more years’ to hit your FI number in a job you hate and a country you want to leave, when actually you could make the move to France and start building your wealth there.

Can I earn enough in France to achieve financial independence and retire early?

For employed expats in France it can be difficult to save enough money, from an employee salary, to become financially independent. Wages in France are notoriously lower than in the UK or US. 

Plus there are some barriers to finding a salaried job in France, like:

  • Language – if you don’t speak fluent French, communicating with your team and French customers will be tricky. Being a native English speaker isn’t as valuable as you might think – A LOT of French people speak excellent English (and Italian, and Spanish)
  • Qualifications – experience doesn’t count as much in France. Having the the right (French) qualifications is everything
  • Transferable skills aren’t really ‘a thing’ in France
  • Networks – of course this isn’t just in France but who you know is very important, as is the French university you went to 

Taxes are higher in France, compared to other countries, so what you have left out of your ‘take home pay’ may not get you to financial freedom as quickly as you would like. 

Of course, the flip side is your taxes pay for the quality of life, infrastructure, and healthcare that are arguably some of the best in the world.

If you’re lucky enough to secure a well paid job in France, well done! Ask all the questions about the company pension and work out how you can benefit from a French state pension. Plus, save, save, save. Look into tax efficient ways to save in France like the Livret A and Assurance Vie accounts.

Read more: What is a French Assurance Vie?

So how else can I make FI money in France?

As long as you have the right to work in France, with the correct visa, carte de séjour or are an EU citizen, then you can register yourself as self-employed. 

This is a bit of a process because you’ll need a social security number for the French healthcare system first. But it is entirely doable and you’ll need to be in the healthcare system anyway if you live permanently in France. This is the carte Vitale application process and your social security number is printed on your carte Vitale.

The French government platform that looks after state-funded healthcare and cartes Vitale is called Ameli.

The French government platform that looks after self-employment is called URSSAF.

In fact, a lot of expats go down the self-employment (autoentrepreneur) route, either as their main form of income or as a side-hustle to make extra FI money to stash away.

One interesting way to make the move to France, while you’re still in the ‘wealth-building’ phase of your FI journey, is to keep your home country job but do it from France as a freelancer. 

Most overseas companies won’t want to keep you as an employee, when you move to France, as they’ll become subject to France’s strict employment laws.

If they say no, could you just set up on your own and service clients from France. There’s never been a better time to work for yourself and start living the French dream before you retire.

Remind yourself of the ‘decent life’ income you need, at the beginning of this article, and work out how you can make that amount and more through self-employment in France.

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