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How much money do I need to live?
Growing Your Money

How much money do I need to live?

How much does life cost?

As simple as this question may be, it seems to be at the top of the mind for many people in Germany. When you’re preparing for salary negotiation at a new job, dreaming of independence or thinking about taking a break from working, it is important to know what kinds of costs you have to take care of each month.

Only those who know their fixed expenses can set up a meaningful financial plan and stick to it. Based on this financial plan, you might discover savings opportunities, that can help you take that year off or prepare for your retirement.

So we asked ourselves, “How much money do I need to live?” Here’s what we found out + some great tips and tricks on where you can save money!

Average living expenses in Germany

Whenever the average cost of living in Germany is mentioned, the shown numbers should be evaluated with caution. After all, the cost of one’s own life depends on many individual factors, and these can lead to significant deviations in one’s personal expenses. As a first orientation, however, the average cost of living is a helpful benchmark in your own financial planning. We recommend that you take these as a jumping off point and adjust them ​​to your own standard of living.

How much does it cost to be single?

The three most important aspects of monthly fixed costs are the expenses for housing, food, and transport. According to statistics from the year 2016, a person living by themselves spends around 1,240 euros per month. Roughly a third of those costs, about 440 euros, are housing expenses. However, this value is highly dependent on the place of residence and the type of housing. Rents in bigger cities are often twice as expensive as in smaller towns, and shared apartments are cheaper than a private apartment.

Food and groceries also occupy a prominent place on the expenditure list and cost an average of 170 euros per month. While there are hardly any regional differences, the buying and eating habits affect the costs. Buying your food in high-end grocery stores or at the weekly market will obviously turn into higher expenses that frequenting discount stores.

Transportation comes to an equal amount, with the average being at just under 170 euros per month. This amount includes the costs of owning a car or tickets for public transport.

Furthermore, people living by themselves spend around 50 euros per month on their health, as well as clothing. An additional 125 euros are spent on recreational activities and 75 euros for household items.

How are the costs of living changing for couples?

Living with another person turns out to be cheaper than living by yourself. Cooking together and purchasing larger quantities or packaging units can save a lot of money. In addition, a shared flat is proportionally cheaper in most cases than living alone in an apartment.

Expenditures on transport, clothing, health and household items stay roughly the same. An increase, however, is possible in the cost of leisure activities, as couples tend to spend more on shared experiences.

All things considered, a couple living in Germany requires an average of 2,480 euros per month.

What are the additional costs of children?

There is nothing new to the fact that children cost a considerable amount of money. But how exactly does the cost of living change when your family grows?

In 2014, the Federal Statistical Office got to the bottom of this question. If a couple has a child, the monthly expenses increase by an average of 584 euros. Couples with two children have to budget 515 Euros per child per month, and three children come with an average cost of 484 Euros per child.

Decreasing expenses for each additional child can be explained by the inheritance of clothing and toys, as well as discounts for siblings and extended families. But these average values, too, ​​should be taken with a grain of salt. Depending on the individual development of the child and the way they spend their leisure time, living expenses can rise rapidly.

Are there any differences for the self-employed and freelancers?

A unique situation is the cost of living of self-employed and freelancers. Due to the special insurance situation, you need more money than an employee. In addition to the monthly expenses already listed, contributions for pension and health insurance are added. A self-employed person has to pay these completely for themselves. In addition, some professions require professional liability insurance.

Savings opportunities: How to lower your cost of living

The first step to discovering your savings opportunities is to get a complete and honest overview of your expenses. This is the easiest way to figure out in which areas of your life you can save money every month.

Listing all of your income and expenses in a helpful way can be a tedious task. We’ve developed the Zuper financial assistant to make sure you have to do as little work as possible and still end up with actionable results. Simply connect your bank accounts and credit cards to the app and Zuper will show you exactly where you’re spending your money and how you can start optimizing.

Download the Zuper Financial Coach for Android. Download the Zuper Financial Coach iOS.

The most significant opportunities for cutting down on your cost of living are usually the following:

- Move to a smaller apartment or cheaper residential area on the outskirts

- Sublease a room in your own home

- Compare of providers for electricity, heating, water, and internet

- Review your insurances based on their costs and need

- Cancel subscriptions you don’t regularly use or find cheaper alternatives (e.g., magazines, gym, online services)

- Energy savings through economical electrical appliances and careful handling

- Change from your own car to the bike or public transport

- Start sharing instead of buying

- Make sure you actually need things before buying them

With these simple tips, it is almost always possible to lower your cost of living and thus either be able to work less or have more money to save.

Paul Niklaus
Paul is a marketing manager at @ZuperBank. He's in love with marketing, standup comedy, and storytelling. In our blog, he shows you how to do the most with your money!
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