If you are planning on moving to the UK, one of the very first questions you’ll have to answer is: ‘How expensive exactly will my life be in the United Kingdom?’.
This question is more important than ever.
In 2023, the UK was severely hit by global price rises which has led to a cost of living crisis for many of its citizens.
Inflation has grown dramatically across the country, with the price of nearly everything from basic consumer goods to housing hitting record highs.
It’s not all bad, however.
Some areas in the UK remain more affordable than others and there are several ways to save considerable amounts of money on your living expenses – if you follow our advice, that is!
Find out how much exactly it costs to live in the UK with our detailed guide of prices for food, energy, housing, transportation, and more.
Table of Contents:
1: Average UK living expenses
2: UK food costs
3: UK Energy costs
4: UK transport costs
5: UK housing costs
6: UK healthcare costs
7: UK education costs
8: Assistance with living costs in the UK
1: Average UK living expenses
In 2022, the UK was ranked the world’s 16th most expensive country to live in, with the average UK household spending around £3,000 to cover living expenses.
While average monthly costs for a single person in the UK are around £2,005 per month, you need to keep in mind that your expenses will get higher if you have to pay rent or a mortgage.
We also need to take these numbers with a pinch of salt, because the cost of living in the UK varies widely across the country.
As of January 2023, Derry is the most affordable city in the UK, while the most expensive is Winchester.
London is famously overpriced, with the average monthly rent here costing around £1,425 – nearly double the national average.
So, does this mean that you should consider relocating to a small city like Derry?
Well, not necessarily.
After all, the cost of living is only relevant to your salary and what you can afford.
For this reason, BudgetDirect ranked the UK cities with the best and worst cost of living by comparing living expenses to the average monthly salary.
Here are the 10 UK cities with the best cost of living:
- Oxford, England
- Glasgow, Scotland
- Reading, England
- Bristol, England,
- Coventry, England
- Derby, England
- Southampton, England
- Birmingham, England
- Edinburgh, Scotland
- Manchester, England
These are the 10 UK cities with the worst cost of living (according to BudgetDirect):
- Wolverhampton, England
- Swansea, Wales
- Norwich, England
- Liverpool, England
- Leeds, England
- Belfast, Northern Ireland
- Sheffield, England
- Cardiff, Wales
- Leicester, England
- London, England
No matter where you live in the UK, the biggest share of your living expenses will come from housing, food and transportation, which altogether make up more than half of the average Briton’s budget.
According to research firm NimbleFins, this is how the average household spends their budgets:
Average Household Expenditures in the UK in 2023
The below data is based on an average annual budget of £34,886
Housing (monthly average for UK)
Rent (private) = £895 (31% of budget)
Rent (social housing) = £461 (16% of budget)
Owned with mortgage = £942 (32% of budget)
Utilities (water, gas, electricity)
Weekly Outgoings = £48
Monthly Outgoings = £208
Annual Outgoings = £2,493
% of Budget = 7%
Council Tax
Weekly Outgoings = £29
Monthly Outgoings = £126
Annual Outgoings = £1,512
% of Budget = 4%
Transport
Weekly Outgoings = £99
Monthly Outgoings = £428
Annual Outgoings = £5,134
% of Budget = 15%
Food and (non-alcoholic) drinks
Weekly Outgoings = £73
Monthly Outgoings = £318
Annual Outgoings = £3,818
% of Budget = 11%
Internet and TV
Weekly Outgoings = £28
Monthly Outgoings = £122
Annual Outgoings = £1,460
% of Budget = 4%
Household (furniture, lines, appliances etc.)
Weekly Outgoings = £42
Monthly Outgoings = £183
Annual Outgoings = £2,201
% of Budget = 6%
UK Food Costs
Inflation in the UK reached a record high last October, according to the latest ONS consumer price inflation data.
Although inflation rates slightly eased between October and November, in this period they stayed at the highest levels ever recorded in over four decades.
Increases in the costs of consumer goods have been the key factors causing rising inflation, with food prices rising sharply over the past year and many people seeking energy bill support.
Annual food inflation in the UK hit 16.5% in November alone, the highest rate for 45 years, while fresh food inflation hit 15% in December, up from 14.3% in November – the highest monthly inflation rate since 2005.
Just to give you an example, as of January 2023, milk costs 45% more than last year, while margarine and spaghetti have risen by more than 30%.
The average grocery bill for one person in the UK is around £130-£140 per month.
However, the actual price you will spend on food will depend on your salary: single professionals who earn between £17,000 and £28,000 per year are likely to spend around 25% less on their weekly food shopping than people who make over £66,000 per year.
The average cost of feeding a child in the UK sits at around £100-£120 per month, depending on their age and caloric needs.
So, based on a family of two adults and two children, you should expect your grocery bill to range between £520 and £600 per month.
Average UK Energy Bills
In the first half of 2022, UK domestic gas prices were below those in most of the EU.
However, gas prices skyrocketed following Russia’s invasion of Ukraine in February, and continued to rise throughout the year due to cuts in Russian supplies.
As a consequence, gas, electricity and water bills have been increasing by substantially more than the EU average.
Energy bills in the UK went up by 54% in April 2022 and a further 27% in October – the highest increases in energy costs since 1988 and 1970 respectively.
By November 2022, gas prices had increased by 129% compared to 2021, while electricity prices had grown by 65%.
As of January 2023, the average annual energy bill in the UK is estimated to be around £2,500.
This figure is based on typical use in a household that uses gas and electricity and pays with direct debit, but the actual cost of your bill will vary based on several factors.
Firstly, your energy bill will change depending on where you live in the UK, even though there is relatively little difference in energy prices across the country.
For example, in 2021 combined gas and electricity bills varied from around £1,270 in the East Midlands to £1,350 in the South West.
To determine the exact amount of energy bills you will have to pay, you need to take into account the type of property you will live in, your heating system, the energy efficiency of your property, the number of people living there, and your personal usage.
Having said that, the average gas bills by household in the UK are estimated to be:
● Flat or 1-bedroom house: £930.39 per year, or £77.53 per month
● 3-bedroom house: £1,343.60 per year, or £111.97 per month
● 5-bedroom house: £1,860.11 per year, or £155.01 per month
The average electricity bills by household in the UK is :
● Flat or 1-bedroom house: £781.87 per year, or £65.16 per month
● 3-bedroom house: £1,156.27 per year, or £96.36 per month
● 5-bedroom house: £1,632.79 per year, or £136.07 per month
The good news is that the UK Government has recently launched a measure to cap the unit of cost of energy, the Energy Price Guarantee (EPG).
The EPG should allow British households to save an average of £900 this winter, according to Government estimates.
UK transport costs
UK households spend an average of £3,500 a year on car running costs per vehicle, while the average amount spent on public transport is around £1,300 a year.
Public transport in the UK is privately owned and run on a commercial basis, meaning that operators are free to charge whatever they want in order to make a profit.
As a consequence, public transport in the UK is famously expensive.
A report from campaign group Transport and Environment found that the UK has in fact the least affordable transport system in Europe.
For example, taking a train in the UK is 5 times more expensive than in the rest of Europe.
The average single local bus ticket costs £2.80, but bus fares vary across the country, with operators in some rural areas charging as much as £5 for a single ticket.
These may strike you as exorbitant fares, and understandably so, but there are ways to save on public transport in the UK.
For instance, more than 130 bus operators across England have recently signed up to cap single bus fares at £2 from 1 January to 31 March 2023.
If you reside outside of London, this cap could save you almost a third of the bus fare you would normally have to pay.
You can check here if your local bus operator has signed up to the £2 bus fare cap.
When taking the train and travelling intercity, it’s a good idea to book train tickets a few weeks in advance, as last-minute tickets fetch high prices.
Alternatively, you could manage to save a third of expenses on train rides, or £142 a year, by signing up for a railcard.
Finally, if you’re on Universal Credit, you may be eligible for a Jobcentre Plus Travel Discount Card, which will save you 50% off travel expenses (more info on the UK benefits system below).
Cost of UK Housing (buying and renting)
Steadily increasing prices last year caused the average UK house price to reach £296,000 in October 2022 – £33,000 more than the year before.
Housing in England remains the most expensive in the UK, with the average house price hitting £316,000 last October.
Following England is Wales, with an average house price of £224,000, and finally, Northern Ireland, which is the cheapest country in the UK to buy a property at an average price of £176,000.
This may surprise many, but London was the only region in the UK where the average house prices decreased last October.
Having said that, you should also take into account that London continues to have the most expensive properties in the whole UK.
The table below breaks down the average cost of housing by UK region, including its monthly and annual changes as of October 2022:
England
Price = £316,073
Monthly change = 0.2%
Annual change = 13.2%
Northern Ireland
Price = £176,131
Monthly change = 4.1%
Annual change =10.7%
Scotland
Price = £194,874
Monthly change = 1.1%
Annual change = 8.5%
Wales
Price = £223,824
Monthly change = 0.1%
Annual change = 11.8%
Average English House Prices by region
East Midlands = £254,079
East of England = £362,865
London = £541,720
North East = £168,367
North West = £220,292
South East = £404,990
South West = £339,206
West Midlands Region = £257,382
Yorkshire and The Humber = £214,036
Taking these numbers into consideration, it’s understandable if you’d prefer to rent a property!
Nevertheless, rental prices in the UK rose by 4.0% in the 12 months to November 2022.
In the same time period, average rental prices increased by nearly 4% in England, over 3% in Wales and 4% in Scotland.
The East Midlands saw the highest annual increase in private rental prices (5.1%), while London and the North East experienced the lowest (3.5%).
And although the last month of 2022 saw the first drop in UK rental prices for over 12 months, rents ended the year almost 11% higher than in 2021, or 16.1% more than in 2015.
The map below displays the average rental price across different UK regions, and includes information about the changes undergone between December 2021 and December 2022:
Source: HomeLet Rental Index Report
UK Healthcare costs
Residents in the UK have access to free medical care under the National Health Service (NHS).
This covers doctor’s appointments and some hospital treatments although most prescriptions come with a charge.
To qualify for NHS treatments as a migrant, first you will have to register for an NHS number.
There are also plenty of private clinics in the UK, with prices varying widely depending on the area, the type of treatment you need, and the experience of the specialist.
Operations in a private clinic tend to be very costly and could easily cost you up to tens of thousands of pounds.
UK education costs
The three main options to study in the UK are government-run state schools, private schools (also referred to by Brits as “public schools”), and international schools.
In the UK, only state schools offer tuition-free education to pupils who live in the country.
The fees for a three-year-old in an international school start from £10,000 and can go up to £19,950, while for a 17-year-old student, they can get as high as £30,000 per year.
Tuition fees at public UK universities vary based on the institution, the type of degree, and the length of the studies.
The ‘home’ cost typically ranges from €5,500 to €10,200 per year, while the ‘international’ price is €3,000–8,000 on top of the initial ‘home’ fee, meaning that it could be two or three times the ‘home’ fee price.
Assistance with living costs in the UK
If you’re struggling to cover your living costs, some help is available in the UK.
The UK benefit system can be difficult to navigate, so below is a list of the main benefits you may be entitled to:
● Carer’s Allowance: £69.70 per week if caring for someone more than 35 hours a week.
● Child Benefit: £21.80 per week for your eldest child, £14.45 for additional children.
● Free childcare: up to 1,140 hours of free childcare in England, with different schemes in place in Scotland, Wales and Northern Ireland.
● Personal Independence Payment: £24.45–£92.40 for mobility and living costs for those with a long-term physical or mental health condition or disability.
● Employment and Support Allowance: £61.05–£117.60 per week if you have a disability or health condition that affects how much you can work.
● Universal Credit: £265.31–£525.72 per month depending on your age and status. This payment is supposed to help with living costs for those on a low income or out of work.
● Jobseeker’s Allowance: £61.05–£77 for those out of work.
State Pension – pension credit – older people
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