Cultural differences

What money can buy.

12:49 PM

A few days ago one of my friend shared an article about Dutch culture and what Americans can learn from it, you can read it here.
As a Swiss I must say many of these Dutch traits are true for the Swiss and probably a good part of Europe. But the one that stroke me the most was this one: Don't spend more than you have.

In Switzerland we live and breathe this one, and is so different from India and especially middle class India. Like most Swiss I had a credit card, pretty much used only for booking holidays as it offers an insurance on the purchase. My credit card was on direct debit, meaning that at the end of the month the money was deducted automatically from my bank account, and even 2-3 Swiss francs missing would result in immediate blocking of said credit card until the balance had been paid. Now I can’t be sure people with the option of paying bills themselves has the blocking clause, but I never met a Swiss person who did not pay the full balance at the end of the month. It’s not in our habit back home…period.
We don’t do purchase in instalment much either, at the most a car, but even then, most of my compatriots will be the one to save money in a saving accounts for years to meet unforeseen expenses and then buy a car in cash, and if all they can afford is a 2nd hand one then be it. never will you see a credit scheme offered on a Fridge or Stereo the way it is offered in India, because people will rather go without than go get a debt of any kind.

And so you can imagine my surprise when I arrived in India and see that people don’t blink about even buying a TV on EMI, even if they are interest free. before reaching India I had no idea you could even use a credit card the next month without paying the due balance, and that the only penalty you’ll get for it is pay interest. A couple of years down the line, DH and I had taken quite a few EMIs, some valid, some well discussable…I will not go there, but with it came the realisation that priorities in India seem to also be totally different from Switzerland and it has I’m afraid a lot to do with the cultural background.

Swiss are people that do not feel like standing out too much, even the riches are considerably “vanilla” and simple on the outside simply because rubbing your status in someone’s face is considered massively rude and tacky in Switzerland. It’s ok to have money, it’s ok to spend it on good things, it’s NOT ok to go make a whole show out of it for all to see in the obvious “look at me I have money and you don’t” way. With this logic, the Swiss, regardless of their social status, will first deal with the necessities such as eating well, paying rent, being healthy and paying insurances, saving money for other things all along. Once that has been done, if they have the cash to spare, they will spend it on hobbies, or indulgences but never in an amount that is more than they can truly afford. If what they are drooling over is a LED giant TV, they will save it every month bit by bit, rather than go to the store and go into a financing scheme, because should an emergency strike they’d rather have the savings to pay for that rather than ask neighbours and friend the money to fly across the globe to see a family member on their death bed when if they didn’t buy the TV on instalment they would have had it all along. You could say that we are a nation of safe, non risk taking individuals. And before I move on, let me tell you the cost of life in Switzerland is quite high, higher than in India for many a thing.

India is a culture that is a bit louder in your face one, people tend to place status high on the list. It’s ok to be loud and brag about your wealth, real or not in India, it’s totally fine to flaunt it for all to see as a sign of superiority. And it’s fine to spend more than you have in order to keep the image going, borrowing from family and friends to host a massive wedding for the community. Buying the biggest TV money can buy on EMI even if it won’t fit in your living room well and all you will watch are serials and the news which do not really benefit from high definition, keeping in mind the prime purpose of the purchase is to show off above all. In fact one thing I have seen more than often in India are people that will pronounce fruits and nuts a luxury and not eat them on a daily basis so that they can buy a material sign of status in it’s place, and it’s not uncommon seeing people go to stores like Big Bazaar flaunting their finest wear, gold and smart phone arguing over the price of the most budget rice in the loose grain section pinching paise on food like they could not afford it, while in Switzerland you are likely to find people going to the farmer’s market every weekend buy their produce at a higher price than in the supermarket wearing generic brand worn out jeans and tees and no designer bags or accessories simply because they want the best on their plate in order to keep healthy.

DH and I are fruit and nuts addict, we spare no money on groceries, and my in-laws find our eating habits a bit odd, fruits for breakfast every day is something they just don’t get, because these are costlier than making poha, upma, or pakoda, to them it seems like a waste of money. But the truth is that I might have “contaminated” DH’s thinking there, he visited Switzerland and Europe on quite a few occasion and admired the simplicity of people and how setting priorities right actually allow my fellow citizens to enjoy their life better, once the need to impress the community is taken out of the equation, you end up seeing things much differently. True we enjoy branded good, and have a nice big fridge now (which we bought on EMI to still be Indian), but we bought it because we needed it and couldn’t care less how stylish, IN or in fashion it is. In this same perspective we still have a tiny cathode tube TV we bought in 2004, it still works perfectly well, and frankly we don’t need a HD TV now, we barely watch it, when it is on it’s to play Dora the Explorer or a Cricket Match, we don’t need supreme image clarity for that, and whoever feel the need to laugh at us for our lack of idiot box style quotient is no real friend of ours so what they think doesn’t even matter. And yes we spend nearly 50k on a birthday party for a 3yo because my in-law requested it as it was tradition, but we both resented it and are glad to be done with that one. And like many people from our generation in India we are questioning these traditions that siphon banks account, the way I see it we are moving toward an India that see the value of money and priorities a bit better than the generation before us.  
As for me, the Swiss, well as much as I think my compatriots are smart spender, I must admit that loosening a little from time to time and indulge isn’t that bad either, as long as it’s not reckless spending.


  1. carvaka3:11 PM

    I think.. there is a common 'impress the community' culture in India, but it depends on where in India you are (in my experience there's more of it in the north for example). However, this thing about buying small things on credit, even if it is interest free etc, is not nearly as common in India as the US and the UK. I went from living in India to the UK and was shocked at the number of 'interest free for 5 years and pay nothing until next year' deals on sofas, fridges and even mortgages. They offered 125% mortgages with 0 deposit and a fairly low interest rate when I first came to the UK. This is unheard of in India. So I think this probably has more to do with the economic policies of the country than the culture necessarily. Also, I travel to Switzerland a lot and you can live a simple life there and still have a high quality of life. This is probably because of the quality of things you don't pay directly for (infrastructure, cleanliness, no overpopulation etc). India is obviously quite a way from achieving that yet.

  2. Very insightful article. The downside of doing things or buying things you cannot afford is worse for the lower income people, they too are pressured to spend money they don't have or have saved for some necessity to spend on a daughter's wedding for example. All because 'otherwise people will talk'! Since those same people will not help in any case, it is better to ignore what they say, but this takes a change of mindset, which will take time.
    I am currently living in Norway, and it is much like Switzerland here, the kind of car you drive or the house you live in, or even your job does not define you, status is the respect you earn through your behaviour. This is how a mature society acts, and I think in that respect we have far to go.

  3. Yes I heard the same thing about US, haven't seen it in the UK but then I just visited there, never lived in the country.
    I think the infrastructure and all is at it's best in Switzerland, people praise the system, and the system do not fail the people, the taxes are high enough that enough goes to keeping things running, and social insurances like pension fund, unemployment insurance and such is taken directly on the income bfore taxes, people have no choice there, they pay their share like everybody else. Compared to India it is not populated, however there is only a small portion of the territory that is really livable, and the majority of the people live in the "plateau" which is stretching between the Alps and the Jura ranges, so compared to other countries in Europe it has a similar people per kilometer ratio despite having one of the smallest total territory surface.
    India could totally achieve similar level of infrastructure and cleanliness if only it wasn't so corrupted and people had a higher sense of civism as well.
    And yes DH is from North India, but we lived in the South exclusively, Mumbai being the further North we ever lived together, and I 100% agree, the North is far more "show off" than the South, and Seriously the further South you go the better the infrastructure and cleanliness is too.

  4. Yup exactly, and it's not just the pressure of marring off a daughter, the medias make a superb job at hammering into people's head that Good life and Status can only be achieved having the latest gadjets in your home, labels on your skin. If you have the money and the look in India you can apparently get away being obnoxious, mean and careless.
    I think a solid percentage of Europe is more about putting values on actions and good deeds than on what's in one's wallet.

  5. carvaka12:42 AM

    Yes, that's what I meant by India is quite a way from that yes. It would be a lot closer if the corruption was lower and civic awareness was higher of course. I used to wonder if it's the corruption, infrastructure and population problems that make Indians less civic or the other way around. I mean are people less civic because life is harder or the other way round? I now think it's probably a bit of both..

  6. I've been wondering about the same for years, it could be a bit of both, but there is also the fact that India is also still stuck in a feudal mindset, it's a democracy on paper, but not in reality. People still think in matter of inferior classes and superior classes and a hierarchy to follow, the lower class expect those above to take care of certain things that the one that a few centuries ago would have probably done but no longer really do thanks to greed. Which is probably also why there is so much more importance to status placed in India compared to Switzerland. Add to this centuries of being colonized and invaded and it could totally explain why India is the way it is, that said it should not be an excuse to stay that way, and people hopefully will start realising that more and more and help the potential India has to truely develop.

  7. Like few of the comments and your reply capture, I think the 'show-off' culture and buying on credit depends on where in India you are from. I am from Kerala and while growing up, I have seen my mom will not spend unnecessarily on sarees or bags or travel by car (she still works and she uses public transport everyday) unless she really needs it. Whereas she made sure that we used to eat fruit everyday (seasonal fruit typically bananas, oranges and grapes), have healthy meals, spend on good quality clothes, typically a new dress is purchased during the two festivals - onam and vishu. Yes we do spend on gold during weddings, but it is generally saved over the years painstakingly. This is true for most of my extended family and lot of my neighbors. A lot of this has carried on to the next generation as well. This might be changing because of the exposure to TV and credit cards, but if you have sent he culture growing up, it still has an influence on the way you think.

  8. I was born & raised in California.
    You see the same rude & tacky displays of status & wealth in California as you do in India.
    You are what you drive, you are what you wear, what restaurants you frequent, the neighborhood you live in & how many square feet your house is your 'identity' in California. Unlike India 'looks' are quite a 'status' issue in California also- hence Californians often boast about all the plastic surgery & cosmeticdental work they've had done.
    Nearly all of this is paid for on credit- the average Californian carries around 150% of his/her net worth in credit debt.
    Never was this more apparent than in 2006 when the recession hit in the US- about 50% of my friends, relatives & acquaintances in California incurred bankruptcies. That was a real 'shocker' for me & a 'reality check' as to how many Californians dealt unrealistically with their finances.
    I guess I can thank my Dutch mom (who was also an accountant) for teaching me that credit can be a valuable 'tool' if you know how to use it. All my balances were paid in full monthly & the only debt I've ever carried was the mortgage on my house.
    Those 0% financing deals, EMI's, 'no money down- no interest for 5 yrs' deals are only for people with a 'positive' credit history- not many Americans have that any more.
    Mind you, California was not as 'hard hit' by the recession as some other states (such as Nevada).

  9. Oh wow I could never imagine myself having 150% of my net worth in credit and debt, this is nut!
    DH had a phase of purchasing everything he wanted on credit card with little regards to what he could actually afford, he learnt his lesson since then. Purchase on EMI and no interest is definitely not a bad thing if you are the type of consumer who is a responsible being with your finances, otherwise this is just the type of thing that will push one further into debts. We bought a few things on EMI, simply because bewtween paying for it in a year at zero interest or forking the full amount at one go, well a smart finance savvy person will see the EMI as a better option, meaning you can keep investing money while paying for your fridge, so yup defintiely seen this way my compatriots are actually missing on something here :-) But for a majority of Indian it's not seen that way many spiral into debt just purachasing everything on credit not seeing the real money disappear...sigh

  10. Hélène7:01 PM

    It's funny I do exactly like you ; big fridge, small old cathode TV, a lot spent on fresh food and as little credit as possible.


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