Cost of living

The cost of living in the UK varies depending on where you live.  Generally, London is the most expensive place in the UK.  As of March 2012, London was ranked 25th most expensive city in the world in which to live for expatriates.  House prices and accommodation costs are more expensive in the South of England than the North of England.  As costs vary so much, it may be useful to compare various sources such as WORKgateways and NRIOL to get an overall summary of approximately how much it costs to live in the UK.  There are also a number of cost-of-living calculators available, such as EasyExpat and Numbeo.

Budgeting

The median salary for a full-time UK worker was £26,244 in 2011.

The figures below are taken from a 2011 report by the Joseph Rowntree Foundation.  The report provides the ‘Minimum Income Standard’ (MIS) for the UK.  The MIS is based on what members of the public think people need to achieve a socially acceptable standard of living in the UK.  It takes into consideration both changes in prices and changes in norms about what people consider to be a socially acceptable standard of living.  For the full report see the Joseph Rowntree Foundation website.

The 2011 figures reflect price increases and the effect of changing tax and benefit rates.

Family type Single working-age person Couple + 2 children Lone parent + 1 child
Weekly budget excluding rent/childcare £184.68 £424.65 £246.37
Percentage inflation rise since 2010 5.3% 5.4% 5.4%
Earnings calculation
Weekly budget including rent and childcare £240.89 £705.63 £466.08
Annual earnings required £15,000 £36,800** £18,243
Hourly wage requirement £7.67 £9.41** £9.33

**If both members of couple work full time. A single-earner couple without childcare would need £31,584, but this would require a wage of £16.15 an hour.

Utilities

These include gas, electricity, water, council tax and the telephone if there is a landline, and broadband internet.  Check your tenancy agreement to see if any of these are included in the rent.

Council tax

Every home in the UK must pay council tax: you must let your local council know that you have moved in to a property, and how many people live there.  Your local council will then calculate how much you must pay per year, depending on the size of the property.  If you live alone, there will be a discount.  There is a variety of ways to pay, including by monthly direct debit, by cheque, or at the post office.  Council tax pays for services such as bin collections, local policing, street maintenance and lighting.

Energy

Many homes in the UK are heated by gas boilers (gas central heating) or by electric radiators.  Due to the often unfavourable weather in Great Britain, heating or gas charges can be the largest utility bill after rent and council tax.  The cost of gas and electricity in the UK varies from company to company.  Gas and electricity companies are very competitive and you may be able to save a considerable amount of money by changing supplier.  There are a number of websites which allow you to compare prices.  Check out uSwitch, Switch2Save, The Energy Shop and UKPower.  The best deals are often ones which you pay monthly by direct debit, straight from your bank account.  You can upload gas and electricity meter readings directly to the companies’ websites.  The most expensive type of energy payment is usually by a coin-operated meter, although these are now less frequently used.

Figures based on an average family home in the UK.

Utility Bill Annual Amount Monthly Amount Weekly Amount
Gas £766 £63.83 £14.73
Electricity £832 £69.33 £16
Water £471 £39.25 £9.06
Council Tax £1439 £119.92 £27.67

Please note that these are only approximations and the costs will vary depending on which area of the country you live in, the size of your house, and the different appliances you use and to what degree.

Television (TV) licence

You must have a television licence in the UK if you watch live television.  The current cost of the licence is £145.50 per year (as at June 2011) for a colour television and £49 per year for a black-and-white television.  Generally, one licence is needed per individual house (not per person) and must be renewed annually.  A licence is also needed if you watch live TV on a laptop.  If you leave the country you can claim back a portion of the fee depending on the length of time remaining on the licence.  See the TV licensing website for more detailed information.

Travel costs

If you need to do a lot of travelling by public transport, e.g. for your commute to work, it is often cheaper to buy a bus pass, Oyster card for the London Underground (Tube), or a railcard.  Have a look at the public transport section for more information.

Non-essential costs

Other expenses to consider might be mobile-phone costs, buying papers and magazines, and going out and socialising.  Cigarettes are very expensive in the UK, at around £7.50 for a pack of 20.  Eating out can also be expensive – a meal for two can cost anything from £10 to over £100.