The cost of living in the UK is becoming increasingly expensive, and inflation is on the rise globally, partly due to the ongoing Covid-related supply chain challenges. As a result, the amount of money required for a comfortable lifestyle has become a widely discussed issue.
Many young individuals seeking employment opportunities and those from overseas considering relocation to the UK often inquire about the amount of money necessary for a comfortable standard of living in the country.
According to research conducted by the Pensions & Lifetime Savings Association and the Child Poverty Action Group, a couple in the UK requires an after-tax income of £49,700 to maintain a comfortable lifestyle, while a family consisting of two parents and two children would need £67,554.
What Constitutes A Comfortable Lifestyle?
The concept of a comfortable lifestyle can vary from person to person depending on individual preferences, needs, and circumstances. However, some common factors that contribute to a comfortable lifestyle in the UK may include adequate housing, access to quality healthcare, a balanced diet, reliable transportation, affordable childcare, leisure activities, and the ability to save money for emergencies and future goals.
Your salary varies from location to location. For instance, the average salary in the UK to lead a comfortable life will be different from the average salary in the USA.
Below are a few major expenses that decide how much you should earn to live comfortably in the UK.
Cost To Raise Children
Raising children can be a significant expense for families in the UK. The exact cost can vary depending on factors such as the child’s age, the number of children in the household, and the family’s income and lifestyle.
According to a 2021 report by the Centre for Economics and Business Research, the average cost of raising a child in the UK from birth to age 21 is approximately £195,000 for a two-parent family or £152,000 for a lone-parent family.
This includes expenses such as housing, childcare, education, food, clothing, and leisure activities but does not account for inflation or the potential costs of higher education.
It’s worth noting that these figures are averages, and the actual cost of raising a child can be higher or lower depending on individual circumstances.
Cost Of Housing
Housing costs in the UK can vary significantly depending on factors such as the location, size, and type of property.
According to data from the UK government, the average monthly rent for a one-bedroom property in the UK was £704 in 2020, while the average monthly rent for a three-bedroom property was £1,054.
However, housing costs can be much higher in some areas, particularly in major cities like London. For example, the average monthly rent for a one-bedroom property in London was £1,397 in 2020, while the average monthly rent for a three-bedroom property was £2,164.
Similarly, the cost of buying a home can vary greatly depending on the location and size of the property.
In 2020, the average house price in the UK was £252,000, but in London, the average house price was £496,000.
Furthermore, you should also consider that housing costs can also be affected by factors such as interest rates, government policies, and economic conditions.
General Living Expenses
General living expenses in the UK can also vary depending on location, lifestyle, and personal choices.
Some common living expenses include:
- Food And Groceries – The average weekly cost for food and groceries in the UK is approximately £60-£80 per person.
- Transportation – The cost of transportation can vary depending on the mode of transport, distance, and frequency of use. The average cost of public transport in the UK is around £70-£100 per month.
- Utilities – This includes expenses such as gas, electricity, water, and internet. The average monthly cost for utilities in the UK is around £130-£150.
- Clothing – The cost of clothing can vary depending on individual preferences and shopping habits. According to a 2020 report by the Office for National Statistics, the average household in the UK spends around £22 per week on clothing.
- Entertainment And Leisure Activities – This includes expenses such as dining out, going to the movies, and participating in hobbies or sports. The amount spent on entertainment and leisure can vary greatly depending on individual preferences and lifestyle.
Note that these figures are averages and may not reflect individual circumstances. The cost of living can also be affected by factors such as inflation, government policies, and economic conditions.
So, Now Back To The Question…
What Salary Do You Need To Live A Comfortable Lifestyle In The UK?
It’s important to avoid the common mistake of assuming that an income of £70,000 would guarantee a comfortable lifestyle in the UK, based on the previously mentioned figures.
It’s crucial to remember that the amounts quoted refer to the necessary expenditure for a couple or a family to achieve a comfortable standard of living. Taxes, National Insurance, and pension contributions must also be accounted for.
Thus, one must earn a higher income than the mentioned figures to have sufficient funds for comfortable living expenses after deductions.
Determining the necessary income for a comfortable lifestyle in the UK is not straightforward due to the country’s tax system.
For instance, couples with one earner will pay more tax than those with two equal incomes. Consider the following examples:
- For a family with one breadwinner to generate £67,554 in after-tax income, they will require a salary of £105,320.
- For a family with two equal incomes, each person must earn £44,875 (a total of £89,750) to produce £33,777 each, resulting in a total after-tax income of £67,554.