Th Cost of Living in Rome as an Expat

Money Matters and the Cost of Living in Rome

Many people have asked me questions regarding the handling of banking and financial matters as an expat in Italy, as well as the cost of living in Rome.  As always, I’m here to help.  Just send me your account number, routing number, and SWIFT code and I’ll take care of everything for you.  Then if you have any further inquiries, just email me and I’ll be in touch…eventually. (By the way, how’s the weather in Brazil this time of year?)

But seriously, it can be a real challenge to deal with these sensitive issues in a foreign country, using foreign currency, and dealing with foreign people who are speaking a foreign language.  It’s scarier than seeing a foreign doctor in some ways…at least you can assume that a doctor has your best interests in mind.  Dropping your pants in front of a total stranger is one thing, but handing them your money is really something quite personal.

For this reason, I’ve asked an expert in financial matters to post some useful information on my blog.  He has written an article which will appear here in a couple of days.  In the meantime, I’ll attempt to answer a few of the more pedestrian questions myself that arise from time to time.

Credit is extended to Mamma, all others pay cash

First know that Italy is still very much a cash society.  Credit cards are accepted reluctantly or not at all in many places.  The average Italian citizen makes 26 credit card transactions a year.  According to the Bank of Italy, that’s half the European average (which in itself is way below the US average).  Rome is a big city and a major tourist destination, so it is easier here than the rest of the country.  But don’t count on using your American Express to pay the barber or the butcher.  Besides, most credit card companies charge a significant foreign transaction fee, so it would be to your advantage to get out of the habit of using plastic for every small purchase.  Back in the States I hardly ever carried more than $20-30 in my wallet and I used to use a credit card for everything, even a $3.00 coffee at Starbucks.  Here in Italy, I visit the Bancomat once or twice a week and use that money to pay for all my expenses, including my rent.

cost of living in rome

Your new credit card

Why is this, you might wonder?  Well, Italy’s culture of cash is deeply rooted in its history. Strong family traditions have made them great savers in order to ensure their children’s financial future.  A reluctance to use credit cards has also made them the euro-region’s least-indebted consumers.  They love owning a house, but at the same time the mortgage lending system is much more restrictive than in the US (you actually have to prove that you’ll be able to afford the monthly payments). Consequently, Italy largely avoided the global real estate bubble during 2002-2007.

Great, but you might ask: how does that affect me?  I tell you all of this just to underscore the important fact that you need to start thinking about using cash for almost everything, including your rent.  But watch out for your wallet in crowded places.  Getting pick-pocketed by a gypsy on the Metro is almost a rite of passage to living in Rome.


The Cost of Living in Rome

As far as the cost of living in Rome, it is equivalent to any big international city.  In fact, it’s much cheaper than New York, London, or Tokyo.  Nevertheless, it’s more expensive than living in a suburb or small town.  Some things are more expensive in Italy than in the U.S., notably energy costs; fuel, electricity, heating, etc.  On the other hand, some things are much cheaper, such as food and wine.  These items are not only cheaper in Rome than almost anywhere in the U.S., but as everyone knows, the quality is also much higher.  Start your diet before you go and then leave your guilt at home.  Life’s too short to eat bad food and drink bad wine.


The cost of living in Rome…un sacco!

OK, let’s talk about some specifics.  Obviously, your greatest expense will be rent.  Like in all cities, the cost of rent is relative to the size, condition, and location of the property.  If you choose to find a studio apartment or a (very) small one-bedroom by yourself, you’ll likely pay 900-1100 Euros a month, including utilities.

If you find a flatmate to share an average two-bedroom place, you’ll reduce your cost to 650-700 a month.  I should mention that these figures assume that you will not be living in Piazza Navona or on the Via Veneto.  Rather, I am referencing the neighborhoods that are just outside of the historical center.  Piazza Bologna, San Giovanni, EUR, etc.

cost of living in Rome

“Let us celebrate the occasion with wine and sweet words.”–Plautus

As far as food, of course it depends on how much cooking you do at home versus eating out.  As a general rule, you can say that packaged foods cost about the same here as in the U.S.  Fresh meat, fish, and produce are a little cheaper in Rome than in the average U.S. city, but of a much higher quality.  And now here’s the really good news: wine is about half the price!  Salute!

Having a car in Rome is not only expensive, but it’s also inconvenient.  It’s a big headache that you just don’t need.  Gasoline costs 3-4 times as much as in the U.S. and there’s nowhere to park.  Using a scooter amounts to playing Russian Roulette by proxy.  The so-called rules of the road are completely different here.  Don’t get me wrong, there are rules.  But if they weren’t programmed into your DNA at birth, then you’ll never be able to understand them.  Don’t even try.

abbonamento mensile

abbonamento mensile

For these reasons, I strongly recommend using public transportation.  The public transportation in Rome, while not perfect, offers many more choices than in the U.S.  For 35 Euros you can buy a monthly pass (abbonamento mensile) for unlimited use of all the buses, trams, subways, and commuter trains.

These tickets cover you not only in the city proper, but also up to 30 kilometers (18 miles) from the downtown area on the “metro trains.”  It’s one of the best bargains in all of Europe, even if you have to deal with the occasional strike (Lo Sciopero).  Don’t get me started on that topic again.

So now let’s do some math for your typical fixed-cost monthly expenses.  Assuming you share a two-bedroom flat (your own bedroom, shared bathroom), housing will be about 650 Euros, including utilities.  Let’s say 200 for groceries and 35 for transportation.  That comes to 885 Euros a month. Add a little more for entertainment and miscellaneous expenses and you’re now over 1,000 Euros.  Which doesn’t seem too bad, right?  But when you consider that the average Italian take home pay is about 1,200, you can begin to see why many choose to live at home for as long as possible.

Final thoughts

So that’s the basics, and if your’re staying in Rome for a year or less, then that’s probably enough information.  But what if you decide to make the move permanently?  Should you open an Italian bank account?  Should you transfer all or most of your US assets to Italy and convert to Euros?  What about buying property in Italy?

I’ll address these questions over the next couple of months.  As I mentioned in the beginning of this post, I have invited an economist to write about some of these issues which will be posted here on my blog in a few days.

Until then, you can feel free to send me all of your financial information via email.  I promise that I will treat it with the utmost professional care and discretion–you can trust me, I’m a doctor  (well, I used to be, anyway).  And if you need to discuss it, don’t forget that Brazil is four hours behind Italy…adeus!

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Living in the Caput Mundi and trying to decipher Italian culture for the English speaking world.

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