Much has been made of the extortionate – and ever-rising – cost of living in the capital, yet that still hasn’t dampened the spirits of thousands of young people who continue flocking to its bright lights undeterred.
Lured by the promise of more available professional opportunities and more tolerant, diverse communities to name a few, many of these aspirational dreamers are quickly brought falling back down to earth with a crash, judging from the anecdotal evidence of peers who have migrated to London and recent graduates of London universities alike.
Instead of living the hedonistic lifestyles of the young and beautiful in London, millennial Londoners are more likely to spend long hours working in menial jobs for which they are overqualified – then spending over half of their income on rent, in many cases. Despite these gloomy predictions for the future of Generation Y, it is possible to start saving money now on the expenditures that you take for granted while living in London – but only if you are prepared to make the necessary lifestyle changes in order not just to stay afloat, but to really thrive. Here’s how.
Rent, rent, rent
During your time in London, rent will undoubtedly be your biggest expense. Here are some tips to cut down on your housing costs: Don’t rule out unconventional housing. No, we’re not talking about squatting or becoming a property guardian. But, since many London warehouses are being converted from their former industrial purposes, warehouse living typically provides a slightly cheaper alternative to the usual residential flatshares, if you are willing to tolerate a large number of housemates (and don’t mind the draughts). Search online for the best rates, or even better, via word of mouth if any of your friends are seasoned Londoners.
Consider living further out from Zones 1 and 2. Many outer boroughs of London are served relatively well by tube and rail links, meaning that you can get to the city centre in under half an hour in some cases. Remember: what essentially matters is not how close to Zone 1, but how close to the nearest station you are. Besides, how much time (apart from work) will you realistically spend in the tourist-infested centre anyway?
Don’t settle for the first adequate rent deal you can get; if you can afford to wait and compare more properties, then do. While it is true that the London property market moves incredibly fast, I have heard of many a dodgy London estate agent who will pressure young people to make a uniformed decision there on the spot. If a flat deal is too good to be true then it likely is, and may come with further problems down the line. Always be extra scrupulous when dealing with online property listings from sites such as Gumtree, too.
Share with others. It goes without saying that this will work out considerably cheaper than a single studio room. With the abundance of housemate-finding websites out there, it has never been easier to find people suited to your living needs. The savings you make will almost always make up for the relative lack of privacy.
To save on utility bills, avoid leaving on the heating for extended periods in the winter and consider investing in an electric blanket instead if this bothers you too much. Otherwise, pile on the jumpers and watch your utility bills fall.
Excluding rent, transport will probably be your next biggest expenditure. Even a student Oyster travelcard for Zones 1-2 costs a staggering £86.80, with the price increasing exponentially the further out you live. So, to avoid the double-bind that comes part and parcel of living in a cheaper property further away, I recommend cycling. Here is why:It’s relatively cheap, with decent quality secondhand bikes costing an average of £150 on sites like Gumtree. Together with the costs of buying a fairly cheap helmet, bike lights and a standard bike lock, this would add up to just over £200 in total – less than the cost of two adult monthly Oyster travelcards for Zones 1-2. In a year, you could potentially save £1,000 from the cost of an annual Oyster travelcard if you factor in additional travel expenses such as the occasional Uber after a night out, for instance.
Depending on the amount of cycling you do, it makes for a free alternative to a costly gym membership and exercise classes. It also tends to be much faster than public transport, since you’ll be able to cut through traffic bottlenecks and avoid tube malfunctions.
The only major caveat, however, is the perceived risk. While it is undoubtedly dangerous to cycle in London, traffic in the city centre tends to be slower due to the sheer amount of congestion. Always remember to cycle prudently, especially in dark or wet conditions, and see if you can plan routes that do not involve incredibly busy intersections like Euston Road.
It’s easy not to notice how much exactly you are spending when going about your daily life in London, even if you are hyper-aware of the extortionate cost of pretty much everything. Sadly, every little expense adds up, and living in a big city means that you will have to examine why you spend money on the things you do, in order to decide where to cut costs. Here are a few pointers to help you on your way: Will that new Shoreditch pop-up bar/one-of-a-kind cinematic dining experience/adult ball pit really be as fun as the pages of Time Out dictate? Instead of following the crowd in going for these faddish, overpriced and mostly underwhelming nights out, do some research into what you would actually enjoy: whether that may be a more casual live music night at a pub, or simply a last-minute flat gathering with friends, Netflix and wine. It’s official: staying in is the new going out, especially in winter months. If you are still itching to conquer the night, however, I suggest checking out Facebook event listings for your favourite venues and sites such as Resident Advisor to score the cheapest early bird tickets for club nights. And always predrink, predrink, predrink.
London has a whole host of free activities and events in its museums, galleries and cultural centres if you’re willing to do the research – a lot of these places are free to enter, such as the British Library and the National Gallery. Another example that immediately comes to mind is the series of monthly Friday Lates hosted by the Science Museum: these free, adult-only events comprise of fascinating talks, interactive exhibitions and activities centred on a certain theme. There is even a popular silent disco, if you are that way inclined.
As for food, nowhere else in the UK can compare with the capital for the sheer diversity of restaurants and eateries here. Whereas many of these places do indeed offer good food at prices low enough to make eating out less of a splurge, harder to resist are the ubiquitous Prets or coffee outlets that dog you on your way to work or study. By cutting back on these unnecessary luxuries, you can save more money to spend on “properly” eating out, rather than, say, the ninth Italian chicken baguette-and-americano combination you’ve had this month.
Of course, making your own food does admittedly take more time and effort, but this is a relatively quick and transparent way to start saving more money immediately. A good starting point for those struggling to make time to prepare food is to bake a batch of granola bars at the weekend for snacking purposes, in order to cut costs when it comes to buying a large lunch. An even easier way is to make a habit of bringing fruit and/or other healthy snacks that need minimal preparation: vegetable sticks with hummus, nuts and seeds, for instance.
Money management apps such as OnTrees and Money Dashboard are taking budgeting into the twenty-first century, and allow you to sidestep the need for any Excel spreadsheet drudgery. Use them to keep track of outgoings from all your bank accounts in one place. Their streamlined, attractive visuals and charts also help you analyse where your money goes at a glance.
And for everything else: always ask yourself whether you really need this item, especially if it’s out of your budget. When you start determining the difference between what you want and what you need – instead of indiscriminately buying stuff – you are making more informed choices about how you spend your disposable income, which ultimately leaves you feeling more empowered and no longer at the mercy of your balance sheet. Emotional spending is just as real as emotional eating, so it’s certainly worth analysing your spending patterns to identify emotional ‘triggers’ that led to you buying expensive things that are now languishing unused somewhere in your flat. It’s certainly fine to treat yourself once in a while, but don’t let the short-term quick fix of retail therapy become an unsustainable habit. Try to make paying off any debts your priority, and adopt a long-term mindset when it comes to your personal finances.