Young Britons thinking of moving abroad cite the rising cost of living as one of the most important reasons for considering an expatriate life. Moving to a country where living standards are better and one can find a more rewarding job is indeed every expat’s dream. Before taking the plunge, you should thus have a good look at the cost of living in the country you are moving to, consider your purchasing power, and make detailed financial calculations to ensure that your living standards can really be better.
Cost of living is of course just one of the factors to think about when considering living standards, and other points, such as the local culture, language, and job opportunities should also contribute to your final decision, but it is still important to have an overview of your financial options.
1. So which are the most expensive cities in the world?
According to the June 2011 Worldwide Cost of Living Survey of the Economist Intelligence Unit, some of the most expensive cities in the world are Tokyo in Japan, Oslo in Norway, Paris in France, Zurich in Switzerland, Frankfurt in Germany and Sydney in Australia. Some of these cities, especially the European locations, and Tokyo have been some of the most expensive places for many years, mostly due to their developed economies.
2. And which are some of the cheapest cities?
Out of the 133 cities surveyed by the Economist Intelligence Unit, Karachi in Pakistan is the cheapest, and some other cities with the lowest living costs are New Delhi in India, Tehran in Iran, Tunis in Tunisia, and Manila in the Philippines. The cheapest cities are mostly located in developing countries.
3. Net Wage Level & Purchasing Power
A list of the most expensive and cheapest cities can be useful, but the single most important factor you’ll have to think about when moving abroad is your net wage in relation to living costs, and your purchasing power. Mumbai might be one of the cheapest cities in the world, but net wages are also much lower, while average salaries in Japan or Germany will be significantly higher. If you are planning to primarily rely on your savings when moving abroad, it is advisable to move somewhere with relatively lower living costs, for example Spain, Canada or the USA. On the other hand, if you are relocating for professional reasons, you’ll most probably be able to maintain high living standards even in some of the most expensive cities in the world.
4. General Living Costs
- Housing – Whether you are renting or plan to eventually buy a property, it is important that you research housing options & costs at your chosen destination. Larger cities, especially crowded ones will always be rather expensive.
- Costs for Food – Find out more about costs of food and restaurant meals before moving to a country, as this will be a significant part of your expenses. If you are on a budget, try buying local products, which can be even easier in the countryside, where you can often buy directly from the producers.
- Education – If you have children, you will also have to think about education costs, even if you haven’t paid for it in the UK. If you are moving to an English-speaking country, you can enroll your children in state-funded schools, provided that they offer high quality education. However, in countries where English is not the native language, you might have to choose an international or bilingual school, and these often tend to be private, so be prepared for further costs.
5. Finding out more
Researching living costs and your potential purchasing power is pivotal before relocating abroad. We have some useful information about living costs and other practical information for over 60 countries in our international country guides. If you need more information, there are various websites, where you can compare general living costs and prices of individual items as well:
- Numbeo lets you compare living costs in different countries, and will also give you information on local purchasing power around the world.
- Expatistan helps you compare living costs in different cities.
If you have any questions, or would like to add something, leave us a comment, or contact Britannia for more information.