For around the last three months, I’ve been intending to move back to London in September to start a new job. Of course I knew the cost of living was going to be higher than here in Tokyo, especially in terms of rent. But, I had somewhat blindly and foolishly presumed that even a starting salary in a professional firm would be enough to live in the UK.
This is the calculation that caused me to put that assumption firmly to one side, and reconsider moving back.
Situation: My wife and I would like to live in our own place in London. Within a few years we would like to start a family, in which case she would not be able to work, hence earnings she might make are not included here. I’m calculating this based on the scenario that we’re attempting to find a 1 bedroom flat in Walthamstow, with enough space to raise a child, in the early years at least. . I haven’t chosen this area for a specific reason, but it seems like somewhere that approaches a reasonable intersection between cost and proximity to work, and the calculation had to start somewhere. All figures are monthly.
Post-tax salary: £1600
After tax, NI contributions, student loan repayments and the like. It’s slightly lower than the average salary for London, but slightly higher than the average salary for the UK as a whole.
Based on a rough average of the cheapest places available on Zoopla.com, rightmove.com etc.
Council tax: £94.32
Band B house, Borough of Waltham Forest
Zone 1-3 Travelcard: £141.40
This was the hardest amount to estimate. Many figures are available for average family homes, but our house will likely be much smaller. However, the Joseph Rowntree Foundation, the International Students Network and the website iamintheuk.com do provide figures, of which this is an average. However all the figures are from prior to 2013’s drastic energy price rises, so the actual figure may well be more than £100 per month.
Grocery bills: £164.90
Again, not easy to calculate exactly. DEFRA figures suggest that the average low income family spends £16.49 per week on food. Assuming a baby may require half the budget of an adult, and multiplying by 4 gives this monthly figure. I’m sure the actual figure might well be higher in reality.
Subtracting the expenses from the monthly salary gives a remainder of £109.38, or just over £25 per week. However, if we were to have a child, I believe this would entitle us to child benefit of £20.80 per week, giving a weekly figure of £45.80 per week. However, my wife is foreign, which may disqualify both of us from child benefit under current rules – I haven’t been able to find the relevant information on the government’s website.
This remaining fraction would need to cover; any other bills such as TV license, phone or internet, travel of any kind for my wife and child, clothes, shoes, nappies, home improvements, and the like. Any kind of luxury, even half a pint of ale in the local pub, is clearly an impossibility, and the idea of saving to buy one’s own house would be so far divorced from reality as to qualify you for immediate consignment to the asylum. The rental cost, at 62.5% of income, is classified under the Mayor’s standard definition as “extremely unaffordable” (more than 50% of take home pay).
So, what are the options?
1. Move further away from the centre, to zone 5, 6 or further. However this increases transport costs at the same time as decreasing rent, to say nothing of the physical and psychological cost of a total daily commuting time of up to three houtrs.
2. Leave London. Unfortunately there are very few jobs for Japanese speakers outside the capital.
3. Asking my wife to work. This may be an option, though I’m sceptical that her wages would be far enough above the resulting cost of childcare to be practical, to say nothing of the emotional cost.
So, I come to the inevitable conclusion that if I move to London, having a child will be impossible for a number of years, at which point age factors may make things difficult (should my wife happen upon this piece I’m not going to disclose details for fear of my vital organs remaining intact).
The cost of living crisis should be more of a scandal. I’m completely aware that I’m in a far better situation than many tens of thousands of people trying to get by in London and the rest of the country; as I mentioned, the salary this calculation is based on is higher than the national average. How these calculations must work for newly trained nurses, police officers, social workers or many hundreds of other vitally important people, I can only imagine; they have my undiluted admiration.
I currently live in Tokyo; just in case anyone has an image that life in Japan’s capital must be more expensive than life in London’s, here is a similar calculation for comparison, based on the same initial pre-tax salary. In this case there is no need for guesses, all figures are just my current expenses. £1 = 167.9 yen.
Salary: 350,000 yen
After all applicable Japanese taxes
Rent: 115,000 yen
Good-sized one bedroom flat, around 20 minutes by train from the city centre.
Council Tax: 12,000 yen
Travelcard: 8130 yen
Grocery bills: 28000 yen per month
Utilities: 10000 yen per month
This leaves a remainder of 176870 yen per month, or £1053.44 – over £260 per week, or ten times the London figure with no child benefit, five times with child benefit; an amount at which one can envisage a comfortable existence, savings and perhaps even the idea of purchasing a house that was so divorced from reality in the London example.
As I say, I know I’m lucky. This is an option that the vast majority of people in working poverty in London just don’t have, so I’m clearly moaning about something that is only a problem if I choose to make it one by moving back to London. But, no matter how much of a middle-class whinge it might sound, I really believe that I shouldn’t be economically disqualified from living in my own country, and that no-one in full-time work should be living in conditions so financially straitened that at the end of a working week, after paying all expenses they don’t have the money left-over to buy essentials for the home, replace worn clothes or shoes, take any non-essential trip or connect to the rest of the world through the phone or internet. I can only hope that before my children are my age, they look at a more favourable outlook on life in the capital. That is, if they ever live there; the chances of them being Tokyo born and bred looks likelier by the day.