Is 2,500 family budget (no mortgage/childcare) per month enough in London????

[zurich09]

Hi,

We are moving from abroad and am trying to figure out our finaces. By the looks of it we will have 2,500 pounds per month once mortgage/childcare has been taken out. Is that enough to live on for a family of three in London? I have no real experience of life in London anymore. Used to live there, but left decades ago and am a bit nervous about coming back. Everyone tells us it's a really really expensive place to live - but now idea whether this is even doable. Any thoughts????

thank you all. at the moment we are calculating that we will have at least 4k take home pay (joint) and will need 1k for mortgage and 500 childcare as we will have some family help....hence the 2.5k left over. i get the feeling that london is not so bad once housing/childcare costs are included. Where we are now everything else is also super expensive so living cheaply is pretty hard...then again a teacher's salary is about 90k per year so most people manage just fine.

having looked at our figures/mortgage options - would going for 2k per month after mortgage/childcare still be ok or is that too low? trying to weigh up mortgage versus life expenditure.....part of the issue is that we are thinking of buying somehwere i.e. long term finacial commitment so trying to see how high/low we should be aiming at.....any ideas??

It really depends on your lifestyle and what you spend your money on. Do you have the fastest internet, the newest mobile phones? Do you eat out a lot or buy expensive food from delis etc? Do you have an expensive car or get a lot of taxis/Uber? You could easily blow through £2k a month but you could also manage on £2k as a family if you are sensible with your expenditure. It's totally dependent on your lifestyle and preferences.

Where you choose to live in London is also a factor. I'm reading a poster saying that a coffee in London is around £2.30. Not near me it isn't!! (I live in central London). There's nothing under £3, average price is closer to £4 (but can go to £6 in some places). Still cheaper than Starbucks in Zurich though (some friends of mine live in Zurich and I'm always horrified at how much they spend on sh*t coffee from Starbucks there).

Do you not have McDonalds and Greggs in central London or do they also charge £3+ for coffee Hundred?

It's about half that everywhere else, except motorway service stations and airports.

We are a family of 4 (2 adults 2 teens) and our standing orders for bills, phones, insurance, cars and regular outgoings like music lessons amount to about £2000.00 per month - but this excludes mortgage, childcare, food, clothes, going out, savings, holidays etc.

honestly - I think that we are a pretty average family of three. We dont aspire for the latest gadgets, but at the same time it would be nice to be able to go to the theatre on in a while and take my kid to the zoon. When I was a kid we couldnt do that, so I wouldnt want that for my own kid. At the same time - I do not need the latest every a la Zurich (and yes it is mad here, but people get paid way more too). Currently trying to weigh up mortgage versus the rest of life expenditures hence my questions. THank you :-)

£2000 for regular bills but not mortgage, childcare or food sounds like an awful lot. Does it include 2 cars on finance?

I think I would start by looking at the right size house in an area with a shortish commute and that a car was not necessary (or accessible via a car club?), and a good school and see what the cost looks like. Then look at what compromises are needed if necessary. Would you prefer to live further out, or live a little more frugally day to day?

Also look at ways to do things cheaper. It is almost never necessary to pay full price at the zoo, or other similar attraction, there are always deals to be had. For example, last time I went to London Zoo, it was two for one if you showed a train ticket and the appropriate internet print out. Similar for chain restaurants. They may look expensive, but a couple of minutes on the internet will get you a half price deal. A little effort will make your money go so much further.

Plus with so many free things to do in London, especially if you already have travel passes, you can have a great day out and spend little or nothing.

2,000 would include food etc......we sould have about 4,000 in total - and costing 1000 for mortgage and 500 for childcare....

thanks for the tips regarding activities - will definitely look out for that

Yes, there are tons of deals out there. You can subscribe for voucher code emails, groupon offers, loyalty emails and phone apps for loads of restaurants and events. TodaysTix regularly has £15 West End tickets and lots of shows have lotteries you can enter to get top seats for £20 each. Kids Weeks is actually the whole of August and tickets go up next week - 2 kids go free with 2 adults.

The Southbank has regular festivals with lots of free workshops and performances for kids of all ages.

More 'local' theatres (Wimbledon, Richmond etc) have cheaper tickets.

All the museums are free and set up brilliantly for kids with lots of hands on experiences and events.

500 a month for childcare sounds very cheap, unless your kid is already at school or family is doing most of it. (And if they are will you have enough money to pay for all the childcare if that arrangement doesn’t work out?)

Other stuff, per month, some very rough estimates :
Food 100/wk - 400 (but you could spend half that if you are frugal)
Internet - 30
Water - 50
Gas and electric - 100
Two mobiles (sim only) - 20
TV licence - 15
Council tax - 200
Amazon prime, Netflix etc - depends on what you use? May be £30?
Transport - depends on how far you commute (what zone) and whether it’s tube or bus, look up on TFL.
House insurance - 10
Car?
Holiday fund?
Present fund?
Clothes
Etc

£1000 for a mortgage and £500 for childcare sounds incredibly low for London.

I think 2k for everything else in London will be tight. Maybe if you don’t run a car and your commute costs are low it’s doable, but there won’t be a lot to spare cash.

£1000 a month cheap for a mortgage too- presume you have a very large deposit?

My council tax and gas/electric are double the above btw.

2.5k isn’t really going spare, it needs to cover all food and bills (aside from mortgage) for the month. I think our bills outside of mortgage are around £800pcm so it does still leave you with a substantial amount, you should be fine especially with one child.

Also London has so many free museums and art galleries on offer plus fantastic parks.

to clarify - we have a 50% deposit so yes mortgage should be about 1,000 and have family helping with looking after him so only 500 for the nursery......so those costs are accurate.....it's just everything else - and thats where it get confusing with some people saying thats plenty and others that it will be tight......;-)

You're getting different answers because people have different expectations.

Some people expect to be able to get coffee and lunch out of the house every day, whereas others think it's a waste of money and probably wouldn't, even if they could easily afford it.

Some people's idea of normal basic grocery shopping is organic everything and unlimited blueberries from Waitrose and obviously that''s rather more expensive than going to Aldi or Tesco with a vague meal plan and buying whatever's on offer.

Some people see using discount codes as miserable and grim, whereas others don't mind, or even enjoy the challenge of getting something for less than full price.

Some people buy their clothes in supermarkets, Matalan etc whereas others go for Hobbs, Karen Millen etc.

Many things can vary wildly in cost and plenty of people are perfectly happy to go for the cheaper options even if they could afford more expensive versions. They'd rather have the savings or work less instead of splashing out on the expensive version of similar things.

That's why some people think it's plenty whereas others think it's a struggle. You just need to work out what sort of people you are as to how comfortable you will be.

oh i know - and i think people are being super helpful. that is also why i asked because people's expectations and budgets do seem to sway quite widely. I would guess that we are the sort of in the middle - have to admit that i've never done vouchers etc as way too much admin and on occasion do go to Waitrose plus would love to be able to go on holidays, but more than happy to shop in H&M and Zara.......and a day out is definitely going to the park or a museum with a packed lunch.....

Do you not have McDonalds and Greggs in central London or do they also charge £3+ for coffee Hundred?

The McDonalds closed down years ago as there's just no demand in the area I live in. A Greggs opened fairly recently but I've never seen anyone go in there. It's mainly independent cafes/shops where I live. We're very spoiled with amazing food and amazing coffee (or at the opposite extreme, some really dire looking fried chicken shops) but you pay a premium for it. If you want something from a chain (other than a supermarket), you need to go a but further afield. Hence my comments that 1) it very much depends on which area of London you live (or work) in and 2) it depends on your tastes (for example, I would rather do without coffee than buy it from McDonalds as I think their coffee is awful but I have friends who love it so would be happy with getting coffee there. No idea which way the OP falls on this one).

No Greggs or McDonalds within walking distance of us either Hundred - there are definitely areas like that in London (both inner and outer). If I want a coffee at home it's the independent cafe or Costa, and at work it's Pret, Starbucks or the naice cafe.

Average weekly food costs in the UK last year apparently £91 per household OP:

www.nimblefins.co.uk/average-uk-household-cost-food

People spend more out of the house and less at home than I'd thought.

Before I read that I was going to say if you're in the middle for grocery shopping, budget for about £80-90 a week from somewhere like Tesco, to include cleaning products and basic toiletries too. I seem to spend about £85 for 4, but that's mostly budget supermarkets. If you are willing to shop primarily at Aldi or Lidl those are usually cheapest overall. These figures are for eating most meals at home btw. If eg your child will have school dinners, factor that in.

thank you all for tips, ideas and budgets! soo much to learn about London/UK....

I think you can, but you would need to plan your expenses well and not go over. There are lots of free activities for children, so that's good.

lots of people have suggested that 1,000 is too low for a mortgage - i am just curious how much do people tend to spend on their mortgage especially if they are on two average salaries for london i.e. 35-45k rather than the 75-90k that people get paid in city jobs? and how do they then afford childcare plus everything else?

£1000 isnt particularly low for a mortgage.
A lot of people who owns houses in London make a chunk of money from their first flat in London to put towards a deposit.

As for how people cope with childcare, most people I know have their child with family one or two days a week to ease the cost/ work from home one day a week.
All nurseries I viewed ranged between £45-£100 a day.

1k on mortgage is low as the price of housing in London is high. 1k pcm is a repayment mortgage for 250k over 25 years. Unless you have a huge deposit then you are going to struggle to buy anything for that sort of money in the m25.

Of course it's doable. That's a bloody fortune.