Economy & Finance
UK Cost of Living
While the British island is indeed a popular destination for foreigners, the UK cost of living is a major downside of spending one’s expat life there. Particularly in recent years, the UK cost of living has been rising tremendously, mostly due to increasing car insurance and energy prices. Thus, it makes sense to set up a budget and keep your basic living expenses in mind.
Basic Living Expenses
When it comes to calculating your UK cost of living, it is usually the basic living expenses that can make or break a budget. Of course, it takes a while to figure out just how much you should expect to pay for rent, food, and other regular expenses. Collecting information on the average price of these basics can be rather helpful.
The average rental cost for a one-bedroom apartment in the city is around £650, depending on its actual size and location. A three-bedroom apartment usually costs around £1,200 in the city center. Please remember that rents can go up significantly when a certain neighborhood becomes more popular. Housing in the suburbs or rural Britain is a little cheaper. On top of the monthly rent, you can expect about £145 in basic utilities for a larger apartment. If you want to take your significant other out for dinner, that will cost you another £40 at a mid-range restaurant.
General Costs Upon Arrival
Unlike UK citizens, expats might have to calculate with additional costs or a higher budget. This particularly applies to the first few weeks or months after your arrival, when you have to go on a job or housing hunt and have to make do with the type of accommodation or mobile provider that is immediately available to you.
The first rent and deposit for your new apartment or your space in a shared flat can amount to £1,000 (or more). Add the costs for the first commute, the costs for furnishing, internet access and mobile phone, and other essentials, and you will be faced with a hefty bill. Of course, this does not take the money you’ll have to spend on insurance, utilities, and food into account. So, don’t underestimate the UK cost of living.
The Soaring Cost of Living in the UK
Since the financial crisis in 2008, the UK cost of living has increased four times faster than the average earnings in the country. While the latter rose to £26,500 at the end of 2012, the rising living expenses caused the real value of wages to fall back on the levels of 2003. This is also due to the fact that many employees have not received any raise at all in the past five years, while some even had their pay cut.
The UK cost of living for transport, insurance, electricity, gas, rent, and food has increased the most. This has forced many people to switch from car to public transportation and from regular supermarkets to budget foods and retailers. The sharp rise in costs for gas and electricity can at least partly be explained with the switch to green energy.
Living Expenses of Families
Families suffer the most from the rise in the UK cost of living. In 2012, an average family in the UK needed £25,000 a year to simply get by. This is an increase of £130, compared to 2011. These numbers include housing costs, utilities, insurances, clothing, food, and the cost of commuting to work. The latter is one of the most severe portions, with petrol and car insurance costs having increased up to 67%.
The problem is that the budget with which families have to calculate does not include luxuries, school fees, or the various taxes. Thus, families are struggling the most to keep up with the current rise in the UK cost of living.
UK Cost of Living: Rural Scotland vs. Urban UK
Generally, it is believed that living in the city is much more expensive than living in a rural area. This might be true in many cases, especially when comparing the cost of living in London with that of a small British town. However, there seem to be some exceptions to this rule: rural Scotland has been found to be much more expensive than many urban areas in Britain. The UK cost of living there is up to 40% higher, to be precise.
The reason for this is that living in remote areas of Scotland is more expensive when it comes to their commute, clothing, food, or household goods. Moreover, high energy bills add to the significant additional costs, as the colder climate and oil-heated, older houses are the norm. So, if your destination of choice is a cozy little cottage in the Scottish countryside, keep the UK cost of living in mind and adjust your budget accordingly.