Why Teaching English in Japan Can Bankrupt You

Why Teaching English in Japan Can Bankrupt You

You don’t really know someone until money is involved. The first time I heard this in high school, I laughed it off. I thought, “No, I know my friends and I know my significant other.” But once I moved out, I started to see truth in this statement. Once I and the people around me had to start paying for rent and utilities and food and transportation, then we’d sometimes get into arguments that never happened when we were living with our parents. Didn’t I pay for gas last time? No, I’m pretty sure I did. Really? You’re going to spend money on a PlayStation? But not us. I just can’t afford it now. Okay. I bring this up because financially induced stress is a very real thing. And there are a lot of people who love Japan that end up experiencing that stress for the first time in Japan. Of the thousands of people who move to Japan each year, many come straight from university via programs like Jet and Interact. they experience their first real job and oftentimes therefore their first real financial responsibility and all the difficulties that come with that in Japan that can create a perfect laundry. The first thing I want to talk program, the gold standard for this kind of work, pays the equivalent of approximately $27,000 a year. But after taxes and pension and health insurance are taken out, each month you’ll be left with approximately $1,850 on a program like Interact, this will be closer to $1,500. Needless to say, while you can live in Japan, especially rural Japan, on these salaries, you won’t have a tremendous amount of wiggle room. One of the reasons for this is the exchange rate. As of right now, May 2025, the yen is hovering at around 145 yen to$1 US, which is a 30-year low. Some people may hear this and say, “Right, but the cost of living in Japan is low. So, even if I’m only making $1,800 a month, that amount of money goes a lot further in Japan than it would in a place like the United States. And while there is truth to this statement, it’s not the full story because you won’t always be buying domestic products. When I moved to Japan on the Jet program in 2009, the yen was actually a little bit stronger than the dollar. When I bought my first iPhone halfway through my three-year contract, it was about 50,000 yen, which was about 25% of my monthly income. The cheapest new iPhone today, the iPhone 16e, is 100,000 yen, which is almost 40% of the current monthly jet salary and 45% of that of Interact. Furthermore, there are many Japanese companies that create and price products based on world demand rather than Japanese demand, which often makes these products relatively more expensive to buy in Japan. In Japan, a PlayStation 5 costs 80,000 yen. And the average monthly income for a new university graduate in Japan is 225,000 yen. This means that a new hireer in Japan would have to spend approximately 35% of their monthly income to buy a PlayStation 5. On the other hand, a PlayStation 5 costs approximately $500 in the United States, where if you’re lucky enough to get a job straight out of university, the average monthly income is approximately $5,500. So in the United States, the same Japanese product is relatively cheaper. It’s just under 10% of the monthly income. Now, you can make the argument that the job market in the US is so bad right now, and it has been so bad for several years that it’s not a fair comparison. But on a minimum wage job in the United States, not a job aimed at new university graduates, a PlayStation 5 is about 40% of monthly income. Real close to that 35% that we saw in Japan. This is what you need to be aware of that buying some Japanese products like a PlayStation 5 on a jet or interact salary is much more like buying them on a minimum wage salary as opposed to an entrylevel new graduate salary in the United States. Now, it’s true that other everyday expenses in Japan, such as eggs, are relatively cheaper, so it evens out a little bit. But once again, this isn’t the full story. While Japanese wages largely haven’t changed for the past 30 years, the price of Japanese rice, perhaps the single most consumed product in all of Japan, doubled over just the past year. There are many reasons for this, but one of them, one of the issues that’s affecting all aspects of the Japanese economy is the declining population. In Japan, there aren’t enough people to fill the job vacancies. There are less farmers to grow Japanese rice. It’s more expensive to move in Japan than it used to be because there are less young, strong people that can carry beds and refrigerators. It’s more expensive to build a house here than it used to be because there are fewer carpenters. These prices probably look like a steal in dollars, but that’s irrelevant when you’re getting paid in Japanese yen, which you will be on programs like Jet and Interact. And these costs are only being exacerbated by overseas tourism. 101 15 years ago when the yen was stronger, Japanese people used to regularly take trips to the United States, places like Hawaii and LA and New York. But the exchange rate and the runaway inflation in the United States has made this prohibitively expensive. Moreover, it’s made it much more enticing for foreigners to visit Japan where a dollar or a euro now goes a long way. This has changed the landscape. Many of the medium to high-end restaurants in places like Tokyo, Osaka, etc. that used to be full of Japanese salary men at noon are now filled with almost exclusively foreign tourists. There’s enough demand from foreign tourists for restaurants to raise their prices. But if they do this, it often means that the locals, Japanese people, and foreigners living in Japan and getting paid in yen can no longer afford to go. And this goes well beyond restaurants. If you want to take a trip to Tokyo during your first year here, be prepared to pay a lot for a hotel because more and more the hotels are orienting toward foreign tourists. Along those lines, don’t expect to be able to take a trip back home during your time on Jet or Interact unless you can have everything except your plane ticket paid for. A simple 10-day trip back home for Christmas. That could easily between the combination of the flight back home, food back home, tips on that food, gas to drive around town and see your friends, that could easily wipe out everything you’ve saved during your first four or 5 months in Japan. And none of this includes what I think is the most dangerous element of all, which is student debt. A lot of new graduates, primarily those from the United States, end up leaving university with tens of thousands of dollars in student debt. To be clear, this isn’t because they weren’t being careful. The price of higher education in the United States has exploded over the past few decades, and you can’t come to Japan on Jet or Interact without a college degree. So, it’s not fair to blame the young people who are just trying to follow the rules that the older generations created. That being said, if you are one of those young people, you need to be aware that trying to pay off US debt in Japanese yen will not be easy. The moment you step foot in Japan and start getting paid in Japanese yen, your debt essentially goes up by 50%. That’s just the exchange rate. It doesn’t take into account international transfer fees, which can also be substantial. Now, I’m not trying to fear monger. I’m not saying any of this because I don’t want you to come to Japan. In fact, I want the opposite. Japan would benefit from more people that love the country, deeply respect the culture, and are happy to work here across professions. I’m saying it again because financially induced stress is a very real thing. And given the state of the Japanese economy, if you’re not mindful of your finances from the moment you arrive, you could easily get blindsided by that stress. And that stress, it could come at the worst time when you’re already dealing with an equally difficult situation caused by cultural misunderstandings or homesickness or something entirely out of your control like a car accident. It could come at the end of your Japan honeymoon phase. You might wake up one day and realize that Japan does have problems. Moving here didn’t get rid of yours. And despite the fact that you’ve been working diligently for a year and a half and not living extravagantly, you’ve got little to nothing to show for it. That is the perfect storm. That’s the difference between I love it here. I can’t wait to find more work after Jet and I’m going home. So now I’d like to try and move on to some practical advice. Because if you are mindful of your money and take a little bit of time early on to draw up a simple plan, then you can have a wonderful rewarding life in Japan that will springboard you into your next endeavor here. Disclaimer: Everything that I’m about to say is not financial advice. All right, so points one and two are quite basic, but they are also things that I was never explicitly taught and probably the most important points on this list. So, at the risk of alienating the financially literate, here we go. One, the first thing you need to do when you start working, whether that’s in Japan, the United States, wherever it might be, is save up a 3 to sixmonth emergency expenses fund. This isn’t you need to save up your monthly income three to six times over, but just three to six times what you spend each month on the essentials. The combination of rent, food, utilities, transportation, phone bill, etc. It’s essential to do this so that if something unexpected happens, which it will, you won’t have to go into debt. Two, you just got paid. What’s the first thing that you do? Buy a Switch game? Get some token ramen? Unfortunately, no. The first thing that you do each month is transfer 15% of that money into a savings account that you never get to touch. You need to allocate some of the money that you make each month to savings because if you don’t, you’ll never end up saving anything. You’ll browse Amazon on your phone or walk through Uniqlo like I did and think to yourself, I can afford that because you will be able to. But then you’ll wake up 6 months or a year down the road and realize that you’ve never had more than $1,000 to your name. Naturally, if you have student debt or any other kind of debt, you also need to allocate some of your money each month to paying that off. Okay, now that we have the macro out of the way, I like to talk about the micro, some tips that are more specific to the Jet program and Interact. One, don’t make the mistake of thinking your brand new life in Japan requires brand new Japanese things. Try and get as much stuff as possible, your rice cooker, your washing machine, your kitchen table from either your predecessor, or a recycle shop. If you’re about to start teaching English in Japan, it’s likely you’re replacing someone else who’s just reached the end of their contract. More often than not, that person will be happy to give you everything that you need to get started or sell it to you for next to nothing because they can’t take that stuff with them. My predecessor sold me his car. I say sold, but he really gave it to me. It was a 15-year-old Mitsubishi mini car that didn’t have power windows, didn’t have a radio or sound system, and probably only had 50 working horsepower, but I got it for $200. You may have seen that I recently got a new car here. What did I do with my old one? I gave it to the local ALT. Again, a lot of the OGs here are happy to help the new recruits, so use that to your advantage. Lean into it. And if you don’t have a predecessor, just go to a recycle shop. There’s no need to spend 5% of your monthly income on a new microwave when you can get one and half the other things that you need for a fraction of that from the local recycle shop, which every Japanese city has. And go beyond kitchen wear and appliances. Get some of your clothes from a local used clothing store. Japan has a ton of these. And because Japanese people are quite fashionable and very good at taking care of things, you can use them to get highquality clothes for very cheap. I used to do this all the time during study abroad. I had to buy a winter coat here. I wasn’t prepared for how cold it gets here during February. I could have gone to the North Face in Harajuku and bought a brand new coat for $200. But I went to the used clothing store right next door and got something equally nice for 40. I still do this. This is the same shirt I’ve been wearing for the past 9 years on YouTube. I shoot, I wash it, it works. This lens I’m shooting with right now, I bought it used on Medukati for 15% off. Get what you can for free and for everything else, settle for used. two kini Japanese convenience stores. They’re fantastic. They live up to their reputation. The food is surprisingly good and they’re always way cheaper than restaurants. You can get two rice balls to onigiri for about 300 yen, which is the equivalent of about $2. That’s reasonable. That being said, if you buy online in bulk, you can have a big bowl of oatmeal with nuts and honey and none of the preservatives for about 80 yen or about 50 US cents. And over the course of a month, that’s a difference of about $50. On a take-home income of $1,500 a month, that’s huge, especially again if you’re trying to pay off debt in the US. Takeaway point, when it comes to food and daily consumables like tissues and toilet paper, buy what you can online in bulk. This not only saves you money, but also countless trips to the supermarket, which frees up time for more productive things, such as studying Japanese, which is three. Consciously incorporating Japanese studies into your daily routine can actually make a big difference in your financial situation. Studying kanji or vocab or grammar every night for an hour and a half necessarily means that you’re spending less time on heading out to karaoke with the other alts or watching the new Hollywood movie on Amazon Prime. Little wins like this 300 yen here, 500 yen there, make all the difference. and many English teaching programs in Japan, such as Jet, often provide free Japanese study materials. These aren’t always the absolute highest quality resources, but that’s okay because when it comes to learning Japanese or any language, the most important thing is immersion. And when you’re working your very first job, it should be a given that you can’t afford the best across the board. And this leads me to point four, which is choose your battles. Maybe you’re a huge gamer. Maybe you have to have a PS5. Then buy one. ideally used. Maybe you derive most of your pleasure from food. Then have that ramen. Maybe have it every week. It’s okay to indulge. You just can’t indulge in everything. When you make your first big purchase or commit to a series of smaller, regular purchases, write a note to yourself that says, “No, you promised it would just be this,” and then pin it to your wall. You can afford to live a little, and you should, even on a small salary. But you can only do this if you’re being strategic. if you’re being selective about the other aspects of your lifestyle. Point five is international transfers. Before I came to Japan on the jet program, I went to a Bank of America in Seattle and converted my US dollar savings into Japanese yen. And then once I came here and set up my new bank account, I had my parents go to that same Bank of America and send it to me via a wire transfer. All in, the process took about 3 hours. And between the conversion, the outgoing transfer fee, the incoming transfer fee, it cost about $100. And during my time on Jet, I and the other foreigners I knew semi-regularly sent money to and from our bank accounts back home. Sometimes this was paying off student debt. Sometimes it was trying to make a purchase that for whatever reason required a non-Japanese credit card. But again, going to the bank and setting up these transfers takes a lot of time and effort and ends up costing a small fortune. It’s not an exaggeration to say that by the time I finished my three years on Jet, I had probably spent close to half a month salary just on international transfer fees. And this that tie into each other. First, and this is a drum I’ve been beating for a while, but it is critical that you build up your skill set while teaching English in Japan, such that when you reach the end of your contract, you can move into a better position. I recently finished this Chris Broad’s book, 10 years in the land of the rising sun, and I loved it. I thought it was fantastic. And I remember thinking to myself while reading it, this is the perfect example. Not only the various things that Chris went out of his way to do on Jet, taking part in the Japanese speech competition two years in a row and making dozens if not hundreds of videos for his YouTube channel, but the book itself. How easy would it have been for Chris, the creator of the most popular and respected YouTube channel in Japan, to just not write a book, to instead keep making videos for his incredibly successful YouTube channel. But even in that position, he pushed himself. In addition to creating those videos, he wrote a hysterical 300page book. And this is the mindset that I think you need to try and be in when you come to Japan. Because when you come to Japan, you will feel like you’re at the top of your game, like you finally made it here. And in that moment, you might let your guard down. But your first year in Japan, your first 3 years in Japan, it’ll be over like that. When that time comes, if you have not been actively building your skill set up on the side, you’ll be in for a very rude awakening. I actually took a hit to my pay when I finished jet and started working at a juku, but it was the only place I could find a job because I didn’t have the teaching qualifications necessary to teach at a private school or at a university. On the other hand, if you do actively sharpen your sword and try and get that teaching qualification or study for the conjuke or make a YouTube channel for your voice acting career or just try and do a little bit of creative writing every single day, then you will find opportunities waiting for you at the end of your contract here, which leads me to my final point. As you become more competent and start saving a little bit of money, there will be a point where it’s actually better to ignore the advice I give in this video. When you first get here, you probably can’t afford to buy a printer, which is fine because you can go to your local cobini and print things out there for 10 yen. Straight out the gates, when you don’t have additional skills or any savings, that’s your better option. But once you start making serious progress toward that teaching degree or your voice acting or photography, modeling, something that has the potential to generate income, and you have some savings, then it’s time to re-evaluate. At that point, it might be better to bite the bullet and buy a used printer because in doing so, you’re also buying yourself time that you can allocate to that side endeavor. And that time might now be more valuable to you than the money that you could save if you didn’t buy a printer and instead just kept going to the combini once or twice a week to print things out for the local a Kaiwa club. This is important to remember because for most of us, the jet program, Interra, other entry-level A Kaiwa positions, these were never the end goal. They were a way for us to get our foot in the door. And for getting your foot in the door, they are still viable options. Depopulation, inflation, over tourism, these things are making it more difficult to save money on programs like Jet and Interact. But if you love Japan, you can still make it happen. If you go into the situation thoughtfully, buy used, plan your compromises, build up that emergency fund, save a little bit of money each month, and plan for the future sooner than later, then not only can you avoid crippling financial stress, but you can have a rewarding life here that makes you optimistic about the future. So, if you’re watching this, by all means, come. I probably couldn’t dissuade you anyway. Just be mindful of your hand and the cards on the table. If you do this, you can have your cake. You can have that Wagyu and eat it too.

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You can find Chris Broad’s book, “Abroad in Japan – Ten years in the Land of the Rising Sun” on Amazon: https://a.co/d/9w0WbD2?tag=dogen-20 (affiliate link)

00:00 Intro
01:59 Current average English teaching salaries
02:39 The negative effects of the weak yen
05:13 The declining population, stagnant wages, and rising costs
06:12 How over tourism is making everything more expensive
07:42 The difficulties of trying to pay U.S. debt in Japanese yen
08:35 How financial difficulties in Japan can compound with other issues
09:42 Practical advice introduction
10:16 General Advice 1: Build up a 3-6 month emergency fund
10:47 General Advice 2: Save 15% of your income each month
11:37 JET Advice 1: Lean on your predecessor and buy used
13:33 JET Advice 2: Don’t over rely on conbini—buying food online in bulk
14:25 JET Advice 3: Make studying Japanese part of your daily routine
15:13 JET Advice 4: Strategic compromise
15:54 JET Advice 5: International transfers and Wise
18:19 JET Advice 6: Build your portfolio ft. Chris Broad
20:15 JET Advice 7: Be mindful of diminishing returns
21:27 Outro

Dogen / Dōgen / Japanese / 日本語 / Why Teaching English in Japan Can Bankrupt You / How Japan Can Make You Poor / The Current Japanese Economy / The Weak Economy / The JET Program / Interac