Why Everyone In Scandinavia Could Retire A Millionaire

There’s no such thing as a free lunch, but this comes pretty close. I have 3 kids, who are potential millionaires simply because we live in Finland. The possibility is real and relies on a few simple things to make it happen.

I’m an American living in Finland, so first a disclaimer. This is not Utopia. The winters are long and dark and the government is always finding innovative ways to dip their hands into my pockets. I dislike the cold and am allergic to high taxes, but I love the fact that my kids can EASILY become financially independent!

My Kids Get An Income

Since birth, my children have received approximately €100 each per month from the government. This is meant to help parents with the cost of raising children (diapers, food etc.). They will receive this monthly until age 18. This is incredible for new parents to help ease the burden of adding a new member to the family. However, if you don’t need to use it, then you can find a better use for it.

No Major Expenses

Taxes are relatively high in Scandinavia (though not much higher than if you live in California), but oh baby do you actually get to see your tax money at work! There are two major expenses that my family and I don’t need to worry about here.

Healthcare is more or less provided by the government with very minimal out of pocket expenses. To give you an example, my youngest daughter was born with a heart condition which required surgery when she was six months old. The total for the surgery, intensive care stay, and one week hospital stay was….€120 ($141)! There’s no need for me to dip into their savings for any health related expenses.

Student Loans in the US have crossed the $1 Trillion mark and they are delaying things like marriage and home purchases. Personal debt is a huge hindrance to saving for retirement. Here, my children can get their Bachelor’s, Master’s, and PhD for free! Again, no need to rob their piggy bank, nor dip into my own savings.

The 8th Wonder Of The World

But the real secret in the sauce is Warren Buffet’s favorite wealth creating tool; compounding interest. Is there anything more wonderful than knowing that your capital is working harder than you are?!

Let’s take a look at the example to see when a child born in Scandinavia would become a millionaire without investing a single penny of their own money.

Let’s assume the child receives €100 per month (€1,200 per year) for 18 years and you’re investing it into a low cost S&P 500 index fund generating approximately 7% annually.


At the end of 18 years, you end up with €44,654.76, of which you contributed exactly 0. I know what you’re thinking; that’s nice, but it’s a long way from €1 million. But first let’s take a moment and be thankful for the fact that your child has almost €50,000 euros of free money sitting in their account, with no need to spend it on a University education!

Now let’s fast forward 47 years, which puts the child at age 65. Let’s assume that the child has never added another penny to the retirement pot, and simply let that money continue to compound in the index fund.


So at the ripe old age of 65, which is probably when most people will need to start their second career because they haven’t saved enough money, this child has hit the €1 million mark without adding any money of their own!

Like I said at the beginning, there’s no free lunch in this world, but becoming a millionaire in Scandinavia comes pretty close!

2 Replies to “Why Everyone In Scandinavia Could Retire A Millionaire”

  1. Wow – now I hate math even more.:)

    1. Adam Tamburello says: Reply

      It’s amazing how doing something so simple can yield such amazing results!

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