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So just think about how these Japanese salary numbers would apply to the U.S. Efforts have been made to improve financial literacy in recent years in Japan, particularly among young people. Revisions to the national school curriculum are said to have been aimed at giving more substance to financial education in high schools in particular. This has perhaps acquired even more importance after the legal age of adulthood in Japan was lowered from 20 to 18 from April 2022. Comparing the results of the survey’s true-or-false questions to the results of a similar survey conducted overseas revealed that Japan ranked low in financial literacy – 22nd out of 30 countries. Perhaps for the longest time, too long maybe, as an expat in Japan, a life of taking it year-by-year, contract-by-contract, has made it hard for us to be prudent in our financial planning.

What kind of resources have you found to help you plan financially for a future in Japan? Whether or not such data reflects financial ignorance or savvy among respondents, or is more reflective of their more material financial circumstances, is not known to us. The Central Council for Financial Services Information, which operates under the secretariat of the Public Relations Department for the Bank of Japan, is involved in promoting the advancement of financial knowledge. In 2019 the council conducted its most recent Financial Literacy Survey, gathering samples from 25,000 respondents across Japan. Monthly figures are as of the end of that particular month.Figures have been rounded.

Just over 10 percent of households had savings of less than one million yen. If you divide the average annual salary in Japan by the average working hours, we get find undervalued stocks an “average wage” of 2,417 yen per hour (about ~$17 USD/hour). Most people would consider this a decent wage in Japan, since it’s an average that includes very well-paid workers in the sample, too. When it comes to foreigners working in Japan, one of the most common jobs is teaching English. The average salary in that position is about 3.2 million yen (~$22,600 USD) per year.

Converting Yen to USD

Those numbers are an annual income of at least 30 million yen (roughly $212,000 USD), and a total net worth of at least 100 million yen (roughly $707,000 USD). Broken down into age groups (based on the age of the head of each household), survey results showed that those households under 40 years of age had the lowest average savings in 2021 at 7.26 million yen. Households in their 60s accounted for the highest savings at 25.37 million yen while those in their 40s and 50s had savings of 11.34 million yen and 18.46 million yen respectively.

Monthly okozukai “pocket money” down among Japan’s company workers

But personally, I would say it’s about the same when it comes to most expenses. If you want precise conversions or you’re not great at doing math in your head, you may want to download a currency conversion app on your phone. However, as of mid-2023, $1 USD is worth around 140 yen, not just 100 yen. This is great for Americans visiting Japan, as it means our dollars go further in Japan now.

Perhaps an average household savings in Japan of 18.8 million yen seems like a lot. In the interests of honesty, it brought out this expat half of a two-person household into a cold sweat. Personally, as someone who grew up in the U.S. and has lived in many U.S. cities, I feel like the estimates I see for Japan prices are usually pretty similar to the U.S. The cost of living in Japan is about 4% lower than in the United States on average. Again, keep 8 price action secrets every trader should know about in mind that the cost of living in Japan is very similar to the U.S. on average (more on that below).

Experts have also cited Japan’s aging population and the increase in payment options behind a need to strengthen financial education across the population. For us, the ministry’s report has once again brought up the specter of our long-term future in Japan and what our retirement might look like, including financially, be it in this country, back home, or elsewhere. Households surveyed for savings and debt as part of the Household Survey Report were selected from 168 municipalities across Japan, from which 8,076 households with two or more persons were selected by random sampling method. A median value – the number right in the middle – for household savings in Japan might make for easier reading which in 2021 was just over 11 million yen. The Japan Population (Live) counter shows a continuously updated estimate of the current population of Japan delivered by Worldometer’s RTS algorithm, which processes data collected from the United Nations Population Division. Whether you need to make cross-border payments or FX risk management solutions, we’ve got you covered.

Contemplating the extent to which long-term foreign nationals in Japan can expect to be part of any financial literacy drive leaves us feeling skeptical. In our experience at least, we tend not to inspire confidence among this nation’s financial institutions. “When people’s financial literacy improves, they tend to exhibit desirable financial behavior, such as setting long-term financial goals, and they become less likely to find themselves involved in financial trouble,” he said.

Historical currency rates

• This has perhaps acquired even more importance after the legal age of adulthood in Japan was lowered from 20 to 18 from April 2022.
• Efforts have been made to improve financial literacy in recent years in Japan, particularly among young people.
• Those numbers are an annual income of at least 30 million yen (roughly $212,000 USD), and a total net worth of at least 100 million yen (roughly $707,000 USD).
• In the, potentially, more immediate future, survey respondents were asked if they had set aside rainy day funds that would cover their expenses for three months in the case of loss of employment or other emergencies.

That’s still pretty good in the scheme of things (the U.S. ranks 13th on the same list)—but it’s not like Japan is super rich. We spent our early years in Japan not paying into a public pension scheme (kokumin nenkin) largely due to employment at unscrupulous English school operations and our own ignorance surrounding such matters. It took finding an employer which had its employees on social insurance (shakai hoken) to set us on the right path in that regard. It’s perhaps a pattern familiar to many foreigners who come to live in Japan and stay longer than they had originally planned. Maybe net savings, taking into account debts and other liabilities, will paint a different or even more useful picture for some.

USD to JPY Chart

• 54.9 percent of the households surveyed were what the ministry report referred to as “working households.” In 2021, these households had average savings of 14.54 million yen with a median value of 8.33 million yen.
• For us, the ministry’s report has once again brought up the specter of our long-term future in Japan and what our retirement might look like, including financially, be it in this country, back home, or elsewhere.
• So just think about how these Japanese salary numbers would apply to the U.S.

54.9 percent of the households surveyed were what the ministry report referred to as “working households.” In 2021, these households had average savings of 14.54 million yen with a median value of 8.33 million yen. Annual income among these working households in 2021 was 7.49 million yen, up 90,000 yen, or 1.2 percent, from the previous year. Japan has a median salary around city index review 3.5 million yen (or ~$24,800) annually, and average salary around 4.2 million yen (or ~$29,700) annually. When broken down monthly, that’s a median salary of roughly 291,000 yen (or ~$2,050 USD) per month. It was always likely, for a start, that a more wealthy minority would tip the balance of average savings in their favor, so to speak. According to the report, 67.6 percent of households surveyed actually had savings below the average of 18.8 million yen.

The increase in savings came despite a decrease in annual income among households in Japan to 6.33 million yen, a decrease of 10,000 yen, or 0.2 percent, from the previous year. Average household savings in Japan increased to 18.8 million yen (around 146,000USD) in 2021, reaching the highest amount in two decades, according to a survey report by the Ministry of Internal Affairs and Communications. First, since Japan’s cost of living is similar to the U.S., it’s pretty easy for Americans to think about this issue.

At dollar stores in the U.S., the quality of the products is often lacking. But in Japan, the 100-yen stores actually have some high-quality, durable products for a great value. The value of the Japanese yen has fallen relative to the US dollar in recent years.

Just ask yourself what wage you’d consider “good” in the U.S., and the answer should be about the same for Japan (converted to yen). After currency conversion, the cost of living in Japan is similar to the U.S. This means you can just convert JPY to USD for a sense of the purchasing power. For example, as of mid-2023, 1 million yen is roughly $7,000 USD, and it can buy about the same as $7,000 USD in the U.S.

In the, potentially, more immediate future, survey respondents were asked if they had set aside rainy day funds that would cover their expenses for three months in the case of loss of employment or other emergencies. The Yearly Population Growth Rate chart plots the annual percentage changes in population registered on July 1 of each year, from 1951 to 2025. This value can differ from the Yearly % Change shown in the historical table, which shows the last year equivalent percentage change assuming homogeneous change in the preceding five year period. For example, the average salary in Tokyo is about 50% higher than in the rest of Japan, at around 6.3 million yen (or ~$44,500 USD). As well as a series of true-or-false questions which were used to gauge the financial literacy of respondents, the survey also addressed respondents with questions regarding their financial future.

On the other hand, maybe these factors provide greater motivation to be prudent. Mercer’s 2020 Cost of Living survey estimated Tokyo to be very expensive, however. They found Tokyo to be the third most expensive city in the world for expats to live in (Hong Kong was #1). If you’re new to using yen, it can take a while to get a feel for how much it’s worth.