Can You Live In London On A £40k Salary in 2024? (Answered!)

Can you live in London on a £40k salary in 2024? The answer is pretty subjective. As you are probably already aware, London is one of the most expensive cities in the world, and living costs are high compared to the rest of the UK. When you factor in rent, bills, travel, and everyday living costs- it all adds up!

At Thrifty Londoner, we polled our London based Instagram audience to find out what they thought. It turns out that 41 people of the 225 people that answered our poll, thought that you could live comfortably in London on a £40k salary or less. Interesting, right? But let’s dive a little deeper.

What is the average salary in London?

The median salary in London in 2023 was £44,370 according to research by Statista. The problem with London averages, is that salaries in London will vary an incredible amount: from the very high to the very low.

That said, it puts a salary of £40k as a little below the median average. That’s not bad! Considering the London Living Wage equates to an approximate £26,325 salary, it means that you should be able to live on a £40k salary in London with a bit of careful planning.

What is the cost of living in London in 2024?

The cost of living in London in 2024 summarised in one word? Expensive. Costs are increasing everywhere you look and it’s tricky to find ways of keeping a lid on the costs that just seem to keep climbing.

The average cost of living in London in 2023 was estimated to be, on average, over £3,000 per month for a single person. It makes sense seeing as the average cost of groceries in London for a single person is £150-200 a month alone.

Now, that doesn’t mean to say that you can’t live on less than £3,000 per month. In fact, you’d need to be earning over £40k to take home £3,000 per month after taxes and other deductions, and many people do live on £3,000 a month or less in the city.

My experience of earning £40k in London

I was earning £40k in London in 2018, 5 years ago! And honestly, times have changed since then. The cost of living has climbed astronomically. Although I was certainly comfortable earning £40k at the time in a dual income, no kids household, I think the reality in 2024 would be quite different.

In 2018 I could rent a 1 bedroom flat with my partner, afford my bills, save for the future, and go on a couple of holidays each year. It was certainly a comfortable wage. But now? The rent of that same flat would have increased by hundreds of pounds a month, utilities would have gone up, and so would pretty much every other area of spending.

In 2018, my side business (Thrifty Londoner!) had also started to earn an income, which certainly supplemented my salary from my employment. My best advice if you’re starting a job earning £40k in London? Make a plan to earn some extra money on the side, OR a plan to get a promotion sooner rather than later.

Do other Londoners think you can live on a £40k salary in 2024?

As I alluded to earlier in this article, 41 people of the 225 Londoners that we surveyed said that they thought that you could live comfortably on £40k a year in London. In fact, 10 people said that they thought you could live comfortably on £30k.

That said, 34 people said you needed to earn £50k to live comfortably in London, and the most popular answer was 60k, which 45 people thought was a comfortable salary in London. That’s an extra £20k per year versus the £60k salary.

Of course, it goes without saying, everyone’s perception of ‘comfortable’ is different. Those who answered that £30k was enough to live comfortably, may be a recent graduate, living in a houseshare on the outskirts of the city. Those who answered £100k or over (29 respondents) might have children or might have a mortgage to pay on a property in London.

Top tips for living in London on £40k or less

Increase your income

Aiming to increase your income will serve you well in 2024. We are living in an uncertain financial climate, and that means you might need to save more towards your financial goals than you previously thought.

In this case, making a detailed plan for promotions at work, mapping out a career path, or starting a side business could all be worthwhile activities in order to grow your income.

🎉Try out our free side hustle tracker to track your extra income

Save for the future

When you’re earning £40k, it might feel difficult to save, as you are likely to be spending most of your salary on everyday living costs.

But getting into the habit of saving (even small amounts) can be really helpful. For example, if you need to move into a different rental and shell out on the deposit, or maybe you have some financial goals (like buying a house) that you’d love to achieve.

One of the best ways to maximise your savings is to make sure that they are in a high interest savings account. This is essentially “free money” and means that your money is working hard for you! It only takes a few moments to check what interest you are getting on your savings, and to move your savings accordingly if necessary.

My personal favourite option is Chip, where you can open an Instant Access savings account, and get a great interest rate too.

Save for a rainy day

Everyone needs a rainy day fund. You might have also seen this referred to as an ’emergency fund.’ The idea being that when a rainy day or an emergency comes up, you have the cash ready and waiting to be used.

Things like an appliance needing to be fixed, emergency dental work, needing to urgently travel to your family, are all reasons why you might need an emergency fund in your back pocket. It means that you can pay for the expense without having to worry about it making a huge hole in your finances.

It’s a good idea to save up for this gradually, and set it aside in a different bank account or savings ‘pot.’ Personally, I have mine saved in a pot in Monzo.

Use a budget

Budgeting is REALLY going to help you make the most of your income when you’re earning a £40k salary in London. Hear me out- budgeting doesn’t have to be super restrictive, it can mean that you are able to spend more on what you want to, and less on what you don’t want to.

It’s also a great way to plan out your savings, and reach your financial goals faster. Essentially, budgeting can make you feel more in control of your money, with less financial anxiety. That’s a must when you’re living in one of the most expensive cities in the world!

I love to use an excel spreadsheet to budget (I’m biased but our Money Matrix is a great one), and then track everything in a free budgeting app like Snoop. Snoop allows you to see all of your accounts at once (including credit cards), and then tracks all of your outgoings for you. It’s a nice stress-free way to track all of your spending.


Is £40k a low income in the UK?

£40k is not a low income in the UK. In fact, in 2023 the average UK income was £34,963. So if you’re earning £40k, you are earning an above average salary compared to the rest of the nation. You can certainly live on a £40k salary in the UK.

What salary is needed to live comfortably in London?

According to our research, 86 out of 225 Londoners thought that you needed to earn between £50-60k a year to live comfortably in London. Can you live in London on a £40k salary? I think the answer is yes, with careful planning.

That said, 10 respondents said that they thought that you can live comfortably on £30k in London. The answer is quite subjective, and depends on the circumstances of the individual. For a single person in their early 20s a salary of £30k might be workable, but for someone in their 40s with a mortgage and children, it’s unlikely to be enough to live comfortably.

Can you live in London on £30k a year?

Living in London on £30k a year would certainly be difficult, but not impossible. In fact, 10 people out of the 225 Londoners that we surveyed said that they thought that you could comfortably live on £30k a year in London.

However, a £30k salary is still fairly far below the average salary in London, so you might find that you need to make sacrifices and adjustments to live in London on £30k per year.

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