Living in one of the world’s most vibrant and cosmopolitan cities comes at a high cost.
If you’ve ever wondered how much you actually need to earn to live a comfortable life in London, we try to breakdown the maths.
But let’s first touch base with how much the average Londoner earns. According to the Office for National Statistics’ data and employment market insights from 2024, the average full-time employee in Londoner makes approximately £47k a year.
While this towers over the median average earning in the UK (37k), the city is known for being pricey, especially when it comes to housing and transport costs.
A good salary in London is typically defined as one that covers a reasonable standard of living after accounting for general living expenses, housing costs, and transportation costs.
So, how much do you need to earn to live a comfortable life in London?
There is no straightforward answer as lifestyle decisions and personal preferences can significantly impact living expenses.
But if you want the nitty-gritty, here’s the maths.
In order to live a relatively carefree life in London, financial advise provider Unbiased says you need to earning between £50,000 to £60,000 per year.
While financial expert and the founder of All Things Money, Ola Majekodunmi, agrees with this estimation, she reveals that it’s possible to live comfortably with less.
She told The Standard: “There are many people who are able to get by in London with fairly less. When living in an expensive city like London, it’s important to consider the different factors such as whether you are commuting to and from work, living on your own or shared accommodation, etc.”
She also shared some advice to making your money go further in the capital.
Rethink zones, not cities
Ms Majekodunmi suggests ways to make the most out of your salary if you’re earning below the comfortable living threshold and it doesn’t include moving out of London.
However, it does include moving of some sorts. “Relocating isn’t always realistic or desirable, especially if you have built a life in the city. But for those earning significantly below the comfortable threshold can rethink Zones, not cities,” she said.
“Consider moving out to areas slighter further out such as zones 4-6, or even commuter towns with fast rail links. They often offer better housing value without giving up on London entirely.”
For most Londoners, housing is usually the biggest expense. London real estate prices are often far higher than the national average.
According to exclusive statistics from Zoopla, the average property price in the capital last year was £535,100, which is 2.4 times — or £59,499 — greater than the average salary in London. This means that the annual income required to own a home in the city is now at least £101,080.
Find creative ways to increase your income
With London offering endless work opportunities, there are ways to increase how much you earn and Ms Majekodunmi says the key is to “find creative ways to increase your income”.
“Whether it’s freelancing, launching a small side business, or retraining for in-demand skills, London is full of opportunities to grow your income beyond your day job,” she said.
Another way of ensuring your survival in London is to get smarter with food shopping.
Ms Majekodunmi says, “Using apps like Too Good To Go, and Olio, can help you to save money on food and reduce waste. Local markets (especially near closing time) can also often beat supermarket prices.”
Make most of benefits and grants
If you’re seriously in trouble with your finances, there’s luckily support available.
Ms Majekodunmi advises to make the most of benefits and grants: “You don’t need to be unemployed to qualify for support. There are benefits available such as Universal Credit, housing benefit, childcare vouchers, and council tax support that can also help part-time workers, parents, and even full-time earners on low wages.
“Some councils even offer one-off hardship grants or energy support funds which most people don’t realise exist.”