London Startup Costs
London is an expensive place, there's no way around it, but it's all made worse when you're spending your home currency and see your savings halved (or worse!) the minute you step off the plane. So how much money does it take to survive in London until you start bringing in a steady paycheque in the mighty £? It depends on loads of different things so keep reading and you should be able to come up with an amount that'll see you through those early days of job hunting.
Many people who move to London have friends who've already made the move. This is especially true of the Aussies and Kiwis who seem to have invaded West London. If you're one of these lucky people then get on the phone and find yourself a couch to stay on! Dossing at a mate's place until you find your feet is so common that there's even a standard rate to pay to stay. Most places will charge you £5/night for the privilege of crashing in the lounge when you first arrive. While not ideal, it's a great way to start out as you'll instantly be connected with your mate's group of friends and you'll save a load of cash that can be put to a better use such as bond money or beer.
Dossing - £5/night
If you don't know anyone in London, you'll probably find yourself spending your first week or two in a backpacker's hostel. If you can find a good one (I recommend Barmy Badger in Earl's Court) then you will probably have a great time. Hostels are very social and you'll meet plenty of people who are in the same boat as you and might even find some people to lease a house with. There are no up front costs with a hostel (except maybe a £5-10 key deposit) but staying long term will take a big bite out of your wallet. Many have weekly rates but these will start anywhere from £70-100 for a dorm room of 4 or more people so it's not exactly value for money if you're into your privacy.
Backpacker's Hostel - Dorm Bed - £70-100/week
Renting a place is a lot more economical than staying in a hostel long term but there are some significant start up costs to consider that will totally destroy your once mighty savings. Contrary to popular belief, it is possible to find a cheap room in London but it depends on where you live, with how many people and how much of a dump the place is. If you share a room with one or two other people in an old, massive sharehouse with 15 people crammed into 6 rooms it will obviously be much cheaper than if you have your own huge room in a huge house with only a couple of housemates. The major killer though with renting is the first month's rent and bond. Most places will require you to fork over a month's rent in advance as well as another 4 to 6 weeks rent as a bond. This could end up being anywhere from £700 to over £1000 up front, depending on how ghetto a place you end up in.
Renting - Twin Share - £50-90/week + bills + 4 to 6 weeks bond
Many people move to London to take advantage of being able to travel cheaply to Europe and beyond. There are always people looking for someone to fill their beds while they're away travelling, sometimes for just a week and sometimes for as long as 4 months or more. Renting short term is a great way to escape from the expense of staying at a hostel but without having to pay the huge up front costs of officially moving into a house (although some might ask for a small bond as security if they'll be away for awhile). Generally the people letting their beds will just be looking to cover their rent, bills and council tax while they're away and sometimes they'll even take a loss on the rent if they're having problems finding someone. You could come across some good deals if you keep your eyes peeled.
Short Term Renting - Twin Share - £50-90/week + bills (usually no bond)
The cost of transportation in London is hideously expensive, especially when you convert that £2 one-way bus journey back to your home currency. There really is no way around forking over loads of money to get around the city unless you take your life into your own hands and decide to cycle to work, or unless you're one of those lucky people who finds a job close enough to walk to. Once you're working and getting a steady paycheque, transportation will just become another monthly bill and won't be as big a deal. But for newcomers the prices will shock and appal and the only thing you can do is reduce the damage as much as possible.
The first thing you should buy on arrival at Heathrow is an Oyster Card. It's pretty much a silly name for a swipe card style travel card. Transport for London are trying to phase out paper tickets and are encouraging the use of Oyster cards by offering discounts on fares purchased on the card. For example, a single bus journey with Oyster costs £1 but is £2 without. A one-way tube journey within zone 1 costs a ridiculously high £4 but is only £1.50 with Oyster. Get an Oyster Card!
Travelcards can be bought either as paper tickets or on your Oyster Card. Travelcards can be daily, weekly, monthly or annually. Buying a weekly Travelcard will be much cheaper than buying daily tickets and monthly will save you a little bit more as well. It's probably a bit risky buying a monthly Travelcard straight away since when you first arrive, you probably won't know where you'll be working and living so it'd be a shame to buy a 3-zone Travelcard when all you needed was a bus pass. Travelcards cover all transport on the Underground from Zones 1 (central London) to D (out in the sticks) with varying prices depending on how many zones you need to cover.
Zone 1-2 Travelcard - Daily £6.60 / Weekly £23.20 / Monthly - £89.10
If you have a Travelcard, bus travel for all zones is included but if you won't need to travel on the Underground then getting a bus pass is a cheaper option. Be aware though that even if you take the bus to work, there will probably be other times where you'll need to take the Underground and you'll have to pay for these journeys on top of your bus pass so it's worth working out how much you think you'll spend to see if a Travelcard is a better option.
All Zone Bus Pass - Daily £3.50 / Weekly £14 / Monthly £53.80
Prices rise every January, usually by quite a lot. The prices above are for 2007 and will undoubtedly be higher in January. Check out Transport for London for the latest fares.
Eating in London can be as cheap or as expensive as you want it to be. If you grab takeaways or head out to dinner every night you'll be pretty screwed pretty fast but if you stick to buying a week's worth of groceries at a cheap supermarket then you'll be able to stretch your money pretty far. Ready meals tend to be pretty expensive but buying meat and fresh veggies isn't as pricey as you might think and a week's worth of healthy food can be purchased for under £20.
Buying food from corner stores isn't really too practical as they don't tend to have much selection and any veggies are usually of dubious quality. Plus they're a little more expensive than an average supermarket. One exception is beer. A lot of corner stores have pretty good deals on cans of beer, a standard one being 8 Foster's for £6.
Cheapest Supermarkets: Iceland, Somerfield, Asda
So How Much Will You Need?
Well this depends totally on your situation. Assuming you'll look for work straight away and stay with friends until you get your first paycheque you could survive on £500 for that first month but you won't have enough to move out and it'd probably take a few months to save up so you'd better hope your friends don't kick you out!
But if you don't know a soul in London, you'll have to live in a hostel and won't have anyone to show you the cheap eats and drinks of the city. Plus, you'll probably end up hanging out centrally in places near your hostel and central London stores will be a bit more costly than those on the outskirts so day-to-day eating will cost a bit more. Keep in mind too that fridge and freezer space is limited in hostels so you won't be able to stock up on groceries and will probably end up buying microwave meals and takeaways a few times per week. And to top it off, hostels are social places and there will always be someone up for a boozy night out meaning you'll either have to exercise some serious self control and risk becoming an outsider, or join in the hijinks and blow your budget a bit. In this situation you'd need £750 minimum for the first month.
If you're more likely to want to find a house straight away then you'll be looking at anywhere from £500 to over £1000 on your first month's rent and bond alone so adding living expenses you'll need anywhere from £1000 to £1750 if this is the situation you think you'll find yourself in. Plus be careful not to arrive with loads of money to put down on a house and then get caught up in London life. Spending £1000 is very easy if you find yourself hitting the town. You'll have a great time in the process, but at the end you'll still be without a place to stay.
Should you find yourself in a financial crisis with nowhere to turn, a payday loan may be your only option. This requires obviously that you have a job because the loans are intended to be paid back on your next payday. Go to Money Supermarket to compare leading payday loan companies that are currently available in the UK.
MONEY & COSTS