Expat cost of living in Amsterdam

After previously speaking about the cost of living in Thailand the UAE, Qatar, China, Hong Kong, Costa Rica and Mexico this article will focus on Amsterdam.

Our staff have also looked at some of the other aspects of living in Sakhalin, such as visas, housing and taxes, alongside the positives and negatives of living in the city and country more generally..

Some of these factors might be affected by the ongoing pandemic in 2020, especially when it comes to visa processes and costs.

Needless to say, expat cost of living will differ considerably depending on your lifestyle, and be quite different to local costs.

For any questions, or if you are looking to invest as an expat, you can contact me using  this form.

Introduction

Amsterdam is the capital of the Kingdom of the Netherlands and the center of the province of North Holland. It is located on the shores of the North Sea, so there is no sharp temperature drop in the city: in summer there is about +20 ° C, and in winter – up to +4 ° C.

The city has a reputation as a place where it rains constantly: statistically, Amsterdam has 182 rainy days a year. However, the weather can change several times a day. Locals, on the other hand, constantly discuss how terrible the endless rain is.

Only 800 thousand people live in Amsterdam, and if you count together with the suburbs, you get 2.3 million people. At the same time, about 4.5 million tourists come to the capital of the Netherlands every year.

The cost of living in the Netherlands is relatively affordable for Western Europe, although the cost of living in Amsterdam and other large Dutch cities is generally higher.

Although the cost of living in the Netherlands is not cheap, you can live in this charming and mysterious part of Western Europe without breaking the bank.

The Netherlands has good scores for general well-being and the best scores for work-life balance. Earnings, housing and education are also rated above average: net adjusted disposable income per family is estimated at around € 25,480, slightly below the world average. This article will explain in detail the various aspects of the cost of living in the Netherlands, especially in Amsterdam.

Visa

There are several ways to move to the Netherlands: get a student visa for the duration of your studies at a university, apply for a partner visa or work permit, as it happened for me.

There are many expats in the country due to favorable tax conditions: dividends from subsidiaries of international companies are not taxed. Therefore, many register an office in the Netherlands: for example, such large companies as “Booking”, “Boeing”, “Tesla”, “Nike”, “Uber”.

If you are in a civil or legal marriage with a citizen of the Netherlands or another EU country, on this basis you can move to the Netherlands and obtain a residence permit with the opportunity to work. 

If your partner has a work permit in the Netherlands, but is not an EU citizen himself, then you can move to the country with him, but you will need to obtain a separate permit to work.

Highly Skilled Migrant Visa is issued by the employer when hiring employees from outside the European Union.

For a visa to be approved, the applicant must contract with a local employer registered with the Immigration Office as a sponsor. In 2019, the salary of such a candidate must be at least € 3299 per month before taxes for employees under 30 years of age. For those who are older – not less than 4500 €.

After five years of uninterrupted life in the Netherlands on a work visa or after three years on a partner visa, you can apply for a permanent residence permit or for citizenship. 

To do this, you must pass a naturalization exam, which includes checking the knowledge of the language and culture of the country.

Salary and work

There are a lot of expats in Amsterdam: in 2017, 38 thousand new residents were registered in the city. Foreign specialists mainly work in IT and finance, so their salaries are higher than the national average.

The average salary in the Netherlands is 2,778 € per month before taxes, according to the Bureau of Economic Policy Analysis.

Job advertisements usually list the monthly gross salary or none at all. If the salary is indicated for the year, then it should be clarified how many times a year it is paid – 12 or 13 – and whether this amount includes a vacation benefit of 8%. All employers pay a vacation allowance once a year – in May, before the summer vacation season.

Look for work through Linkedin, Glassdoor or acquaintances. The quickest way to find it is to ask a friend to send your resume directly to the HR department. Dutch HRs in international companies receive hundreds of job applications, so a recommendation from a colleague increases your chances of being interviewed.

Here are average monthly salaries in Amsterdam, before taxes, for employees with 3-5 years of experience:

• IT developer – 3800-4200 € 
• financial controller – 3500-4000 € 
• marketing specialist – 3500-4000 € 
• accountant – 3000-3700 € 
• bus driver – 2900 € 
• electrician – 2400 € 
• hairdresser – 1900 € 

From 1 July 2019, the minimum wage per month for all employees over 21 years old is € 1,635.6. The minimum wage is revised twice a year – on January 1 and July 1. 

Living in Amsterdam on the minimum wage is possible only if there is no need to rent an apartment, because life here is expensive. Now let’s become acquainted with property rates.

Housing

There is a very high demand for rental housing in Amsterdam itself. If you look for an option outside the ring or in the suburbs, the chances of finding housing at an affordable price increase.

The average cost of a small apartment for two in Amsterdam itself is 1,500 euros. Many apartments in historic buildings are very tiny, with a shower directly above the toilet or behind a partition in the bedroom. 

The most extravagant option we’ve seen is a closet toilet. After that, the bathroom one floor below the apartment itself or the bedroom across the floor from the living room no longer seemed so strange. 

A bathroom instead of a shower in an apartment in one of the central areas can become a real exotic.

To get a good apartment, you will have to try: look at many options and convince the owners you like that you are the very ideal tenants they are looking for.

Sometimes such an essay needs to be submitted, even to get to the initial viewing. Although most often the real estate agency appoints an open house day, when everyone who wants to inspect the apartment at the same time.

Often apartments are rented unfurnished, and sometimes without a floor. Laminate here belongs to the same category as a sofa or a table – it is bought once and taken with you when you move. The most popular sites for finding housing are funda.nl and pararius.com.

To sign a lease, you will be asked to provide a work contract showing income. If the work contract is for a shorter period than the desired lease, then you may be charged a deposit of two months of the lease.

Transport

Transportation costs per month are highly dependent on the distance between work and home. Most Amsterdam citizens travel by bike: the journey from home to office rarely takes more than 20-30 minutes. On business, to a bar, to a workout or on a date, they also most often ride a bike.

Those who work far from home and travel by metro, tram or bus are more likely to use OV-chipkaart. This is a travel pass (the plastic card itself costs 7.5 euros), on which money is entered, and then debited for each stop – this is much cheaper than hour or day passes, which it makes sense to use only for tourists. 

Another option is a personalized card with unlimited travel on the selected route for a fixed price (the cost depends on the mileage) – this option is convenient if you need to get to work by train. It is possible to receive a 40% discount on travel for 60 euros per year.

Bicycles are the main transport in Amsterdam. It is advisable to choose a very old and shabby life, so as not to be stolen. But such people also steal. You can also rent a bike – for a few days or for a long period. There are 880 thousand bicycles per 800 thousand inhabitants of the city, of which about 12 thousand end up annually at the bottom of canals and rivers.

Having a car in Amsterdam is very expensive: there are few parking spaces. Parking in the center costs 7.5 € per hour, two kilometers from the Central Station – 6 €, on the outskirts – 1.4 €. 

Such prices were specially introduced so that there were as few cars as possible in the city and more people were transferred to bicycles.

Trains between cities run frequently and on schedule. Tickets are sold at vending machines in train station buildings and on the railways website. If you buy online, you can save 1 €.

Food

Food for a family of two costs about 400 euros per month. At the same time, the menu comes out quite diverse: it includes fresh fruits, berries and vegetables, and seafood, and a variety of cheeses, and freshly squeezed juices.

The most popular supermarket chain is Albert Heijn, they are always nearby. This chain belongs to the middle class, but it is constantly expensive to buy in it.

Dirk has a pretty good assortment and prices, but there are far fewer stores than Albert Heijn. Jumbo also belongs to the middle class; their outlets are also noticeably smaller. 

From the low price segment, we can mention Lidl and Aldi, from the premium segment – Marqt and Ekoplaza. 

You can save on food by applying for a store discount card. It allows you to buy certain goods significantly cheaper if you study the schedule of promotions in the mailing list in advance and create a menu several days in advance.

A piece of cheese costs 2.5 euros, a pound of shrimp – 8 euros, a pound of cherries – 3-4 euros, a mango or small melon – 1-2 euros. 

There are a lot of markets in Amsterdam, some are open from Monday to Saturday, some only on Saturdays. Bread, croissants and other pastries should be taken only in bakeries, they are much tastier there.

Taxes

Above, we talked about the average salary before taxes. The amount after tax can be reduced by 40-50% depending on the salary. 

The country uses a progressive taxation system, that is, the more income, the higher the tax rate. If a person is employed, then every month the tax is deducted from his salary.

Before signing the contract, it is better to ask what the salary will be after tax. There is an unofficial site that will roughly calculate the amount “on hand”.

Once a year, the law obliges you to submit an income tax return, which indicates the salary for the year, tax and insurance deductions and other payments that affect the amount of tax. 

In most cases, this declaration can be submitted only in electronic form – through the tax website, before May 1 of the year following the reporting year.

The tax is reduced by contributions to charity, payments to recognized political parties, and interest on mortgages.

If this is your first year in the Netherlands, then a thick booklet will come by mail, which you will need to fill out and send to the tax office – also by regular mail. 

The booklet is entirely in Dutch. It is easier to hire a consultant who will file the tax return for you and accurately indicate all possible deductions in order to get as much tax back as possible.

In the Netherlands, there are special tax conditions for expats: a tax deduction, or “taxiing,” whereby taxable income is reduced by 30%. 

With the approval of the tax authorities, it can be obtained by foreigners who have not lived in the country before or who have lived more than 150 km from the border of the Netherlands and have moved on a highly qualified specialist visa.

With a salary of 50,000 € per year, as a general rule, after taxes, you will receive 2886 € per month. If you apply taxiing, you will get 3389 €. Since 2019, the steering wheel is valid for five years from the date of arrival.

VAT in the country is 21% on most goods. It is already included in the check, except for some professional services. For example, a tax consultant can indicate his rate excluding VAT, but he will issue an invoice with 21% tax.

When applying for a mortgage, you will have to hire a mortgage broker and pay him 2500-3000 €. He draws up the transaction and calculates various taxes, which amount to 10% of the cost of housing. The good news is that some taxes can be refunded after filing a tax return.

Banks

To open a bank account for a foreigner, you need to come to any branch with a passport and BSN – the registration number of a Dutch resident. 

It is better to make an appointment in advance so as not to wait in line and to be guaranteed to get the attention of a consultant. If there are no free employees, they will offer to come tomorrow by appointment.

The main banks in the country are ING, ABN Amro and Rabobank. The most common is ING, almost all local residents have an account in it. 

ING is recommended because it has a convenient English application and the ability to make transfers and payments using a phone without a special push-button device. Maintaining an account in ING costs me 4.65 € per quarter.

Mortgage rates in the Netherlands are extremely attractive, so the Dutch prefer to buy housing right away, rather than rent: it turns out cheaper. 

In addition, the income tax is also reduced – due to the tax deduction on the interest on the mortgage. The down payment is not required, you can take a mortgage for all 100% of the cost of housing.

Average mortgage rates for February 2019:

• for 5 years – 1.7-2.2%;
• for 10 years – 2.2-2.57%;
• for 20 years – 2.65-3.4%.

It is quite possible for a foreigner not even from the EU to get a mortgage. The key to her approval is an open-ended contract with the employer as confirmation of the source of income in the future. Also, many banks give foreigners a maximum of 90% of the cost of housing.

Medicine

In the Netherlands, health insurance is compulsory for all residents. The cost of the basic package usually starts at 110 € (10,064 R).

The basic package includes consultations with a family doctor and specialists. Visits to the emergency room with acute pain are also covered. If you have gastritis, you first go to your family doctor, he will send you to a gastroenterologist who prescribes medications or additional examinations. 

But in case of an acute attack of pain, you need to take a taxi to the hospital and wait for an appointment on a first-come, first-served basis.

To the basic package, you can add, for example, a dentist and overseas coverage. If you pay for the dentist in addition to the basic insurance, then such insurance will cover the treatment for 450 € per year and will cost an additional 20-25 € per month.

Routine dental check-ups without treatment cost about 50 €, wisdom tooth extraction – 250-270 €, canal cleaning in a tooth with three canals – 600 €. So the teeth cannot be cured for 450 €.

Separate dental insurance costs 37.5 € per month. It covers up to € 1150 per year for treatment. But when applying for such insurance, you need to bring confirmation from the dentist that in the near future you will not need expensive treatment.

Entertainment

Various festivals and other events are regularly held in Amsterdam – from musical to gastronomic. 

One of the favorite events is the monthly Sunday market in Westerpark with street food – there you can try Chilean empanadas, grilled sausages, Spanish paella, and much more. In addition, you can buy hand-painted crockery.

In good weather, the Dutch all go out into the street: someone sips wine on their balcony, someone rides a boat on the canals, someone sits with friends in a summer cafe, and someone has a barbecue in the park. 

By the way, this is one of the most popular summer entertainments – many parks already have barbecues on special areas, tables and benches are set up, so you only need to bring food and coal. But most come with their compact or completely disposable barbecue grills, and even on weekdays after 18:00 you can hardly find a free lawn.

As for going to bars and restaurants, you don’t need a special reason for this, so regardless of the day of the week, a table in a good establishment should be booked in advance. 

On average, a trip to a restaurant for two (with two hot dishes and two glasses of wine or mugs of beer) will cost 40-50 euros. Breakfast or brunch for two will cost around 25-30 euros. A cinema ticket costs about 12 euros. You can buy unlimited pass for a month for 20 euros.

The prices described may seem high, but since you can only move as a “highly skilled migrant”, your minimum starting salary will also be rather high. In general, the prices are adequate. Interesting people, beautiful cities and daily cycling are priceless! 

Amsterdam is a great city, full of new people, interesting things and everyday busy life, so this place can be a home for a lot of expats looking for new emotions.