Is It Possible To Live In London On Low Income Without Benefits?

Rachel Holdsworth
By Rachel Holdsworth Last edited 59 months ago
Is It Possible To Live In London On Low Income Without Benefits?

There's a lot of talk about housing benefit claimants – well, about benefits claimants in general – and housing in London is a particularly emotive issue. We regularly see comments along the lines of 'if you can't afford to live in London, don't live here', and we started wondering if it is actually possible for someone on a low income to live in the capital without claiming benefits.

So. We created an ideal scenario. We imagined a family with two children and calculated likely income and expenditure for that family, with two adults working and also for one adult working. We looked at minimum and living wages and a variety of housing options (including moving outside London). And we found that even in our fictional ideal world, we couldn't get our family to live anywhere without help on just one income. The figures are at the bottom of this post but first, here's our reasoning.

Affordable housing
As you'll know if you've ever tried to rent, the cheapest available flats are like gold dust. In our searches on there were only a couple of two bedroom flats at the lowest price points. (In our choice of two bedroom flats we're assuming that these imaginary children are the same gender, or young enough to share.) There are around 700,000 people (PDF) in London earning less than the living wage: that's a lot of people chasing not many cheap properties.

40 hours a week?
We could have made our adults work 48 hours a week, because that's the maximum number of hours a week allowed under the Working Time Directive. However, it's debatable how many people actually get to work even 40 hours a week on low wages. Many people on salaries work more than their contracted hours, but that's a very different situation to your employer paying by the clock and kicking you out when the shift's done. Also, take a look at the government's job search site and many positions are part time or, increasingly, zero hours contracts. Even patching together two of these jobs might not bring the hours up to 40. And every five fewer hours worked a week brings in £133 (before tax) less a month on minimum wage.

If the parents are working, who's looking after the kids? Childcare is ridiculously expensive, so unless you're living near grandparents or friends (another reason to stay in a particular area), or the children are old enough to let themselves in after school, it probably works out cheaper for one parent on a low income (or an average one, for that matter) to not work. And no, we're not subscribing to the idea that poor people shouldn't have children; apart from the social engineering aspect, how many of us really know what our incomes will be over 18-21 years, up or down, boom and bust?

The flats
We looked on for what seemed to be the standard bottom line in certain areas, and there were only ever a couple at the lowest price point. (We had a quick look at the accompanying photos and they didn't look like damp covered, rat infested pits, but you can never tell.) This is the best scenario for our family but there aren't enough of these cheap flats for everyone who needs one, so a more likely situation is at least £100pcm more. Several properties also refused to take tenants on housing benefit, which reduces the available pool even further. Point of interest: we first did this research in January, and some rents have gone up about £50 a month since then.

Move out of London?
That might sound like a reasonable idea: after all, rents are a lot cheaper outside London, aren't they? Yes. But not enough to offset the increased cost of travel back into town, as we found when we looked for flats in Milton Keynes, Sevenoaks, Chelmsford and Guildford and then added on the cost of a monthly rail season ticket plus travelcard (lucky the worker who has a job near their London terminus). There's also the issue that some low paid jobs have hours that don't fit with the timetables. So long as people are needed to clean London's shops and offices, make coffees and serve in shops, they're going to have to live here.

The reality
Going by these figures then, yes, it's entirely possible to live in London without benefits if there are two people working (and let's not forget that only 1 in 8 of housing benefit claimants are unemployed, and over 90% of new claimants are in work). But this is, as we've said, an idealised situation. The best case scenario, if you will. Start removing some hours of work and the probability that the cheapest flats aren't available, and the amount of available cash gets ever smaller. And of course, we can't expect people to spend every last penny on their rent: what about clothes, shoes, occasional tube travel for the kids, treats, emergencies, putting some money to one side for a rainy day?

The numbers
Here are our figures. We took a family with two children and worked out the income if two parents were on the minimum, and also living, wage; also what would happen if only one parent had work or is a one-parent family. We also included child benefit for two children (around £145 a month). We didn't include any other benefits a) because the benefits system is quite complicated and b) that was the whole point of this exercise.

We then looked for the cheapest deals we could find for bills (and in the case of water, used our own). You'll notice that we've included broadband in here; the UN considers internet access a human right (though who paid for the computer to use it with, we'll leave to your imagination). We haven't included mobile phones, though. For food, despite that Sainsbury's ad a few years ago boasting how you could feed a family of four on £50 a week, we've gone with this assessment that it's more like £80 a week.

We've also used travelcards as the basis of our transport costs, even though buses are cheaper. We decided that if our fictional parents are working 40 hours a week, they might like to get home in time to see their kids before they go to bed rather than spending ages on the bus. (The kids can use free bus travel to get to school.) We also assumed that jobs were in zone 1 – yes, we know that there are jobs all over London, but we tried to keep it simple.


Minimum wage: £6.19 an hour x 40 hours = £247.60 a week / £1064.68 a month. After tax and with child benefit: £1103.87 a month.
With two people earning plus child benefit: £2062.74 a month

London Living Wage £8.55 an hour x 40 = £342 a week / £1470.60 a month. After tax and with child benefit: £1379.89 a month.
With two people earning plus child benefit: £2614.78 a month


Gas and electricity: £66.92 a month
Water: £30.60 a month
TV licence: £12.13 a month
Phone and broadband: £17 a month
Contents insurance: £5.73 a month
Council tax: dependent on area, roughly £100 a month (£75 a month for single adult household)
Monthly travelcard zone 1-3: £136.80 / Monthly travelcard 1-6: £213.60
Food: £350 a month / £270 for single adult household

Money left on minimum wage*
Two adults living in zone 1-3 have £1206.76 left
One adult living in zone 1-3 has £489.69 left
Two adults living in zone 1-6 have £1053.16 left
One adult living in zone 1-6 has £412.89 left

Money left on living wage*
Two adults living in zone 1-3 have £1758.80 left
One adult living in zone 1-3 has £765.71 left
Two adults living in zone 1-6 have £1605.20 left
One adult living in zone 1-6 has £688.91 left

*Edit November 2013: we've since realised that when we did these calculations, we made some mistakes that made the results more generous. We've now updated.

So, where can they afford to live?
These were the cheapest two bedroom flats we found in the following areas:

Zone 3
Neasden/Willesden from £1100 pcm
Tooting from £1050pcm
Catford from £900pcm
Stratford from £950pcm
Tottenham from £1000pcm

Zone 6
Gidea Park from £800pcm
Bexley from £750pcm
Caterham from £850pcm
Feltham from £850pcm
Hillingdon from £1050pcm
Enfield from £950pcm

Outside London

Milton Keynes: flats start around £550pcm
Monthly travel with travelcard £528

Sevenoaks: flats start around £850pcm
Monthly travel with travelcard £358.70

Chelmsford: flats start around £650pcm
Monthly travel with travelcard £429.40

Guildford: flats start around £850pcm
Monthly travel with travelcard £382.50

Read more: Why don't people on low incomes all live in the cheap bits of London? and What are the solutions to London's housing crisis?

Photo of the mostly former council-owned Delany House in Greenwich by Andy Worthington from the Londonist Flickr pool

Last Updated 03 June 2013


I guess it's possible if they don't mind being barefoot and naked. You haven't allowed for,clothes and shoes.

Marc Whiffen

Why doesn't everyone do that? Because as soon as those outlying areas become popular, watch the rents increase rapidly and by huge margins


Facinating analysis, thanks!

Dana Jobinasecond

Great research and fascinating article - very much in line with all the feedback we get from people getting work through Jobinasecond, needing to add to their existing jobs with flexible work in London


pretty cheap places to buy/rent in barking and dagenham


Fantastic series!


What we need is a revolution, I know it's coming, but the sooner the better !

Tina Gray

I have wasted athe good part of an hour writiing my reply which answers the housing crisis problems...but was forced to join disqus upon submitting my comment and of course my hour report vanished into thin air ( must have worried someone who saw themselves being unemployed , lowered incomes, losing their home in place of a new home...all of which were explained in my swept under thge carpet of red tape with other reports which answered the crisis problem as is the usual case...I had a safe guard in place to show my report was written should I need to produce it at a later stage.


Who are Discus? I don't want to merge so can't use other sign in!
The answer is no in central London, which is a big area of London with many families.
Proves people (like myself) are being priced out of London. Generations of my family born & raised in central London, zone 1, being divided & displaced.
The allowance for gas/elec is low, my daughter in 2 bedroom flat with 2 children average £30 per week. What about school dinners/childcare/school trips costs. Prescription charges. Initial layout for child oyster card £15 each. Forget holidays/days out/swimming club/gym/cinema etc... birthday/Christmas a nightmare!

Jonathan Jones

I’m surprised that Barking & Dagenham weren't mentioned
in this article. It's statistically the cheapest area to live in London – all
be it the not so nice area of London.

Raji Zac

Hi Rachel ,the Above information was very helpful, I am working in UAE and I got a offer to join a group of Hotel in London. They have offered me GBP 2000 per month. is this okay to stay in London with my wife and two Children. I heard a lot of Tax being paid. after deduction what is the amount I would be getting. can I stay in London with this kind of Salary with minimum expenses.. Please advice. In UAE we get a tax free salary and this kind of money is okay if you don't have any loans.

Alex Wright

The hypothetical family could maybe just about squeeze into a room at market rents I guess (spending a vast percentage of their income on that do), bringing us right back to the olden days.

Though some people need Housing Benefit top ups to afford even rooms in London, too.


This is not a bad study on the cost of living in London but there's another living expenses guide you can use to fill the gaps left by this one -
Combine the data from the two, compare and you'll get a better idea of the actual cost of life in London.


No childcare costs or have i missed? Difficult to have two people working 40 hour weeks, with children without any paid for childcare.

Laura Knight

People are not just being priced out of London but out of every town which is expensive by local standards.There is social housing in inner London, but a lot of it is the 'wrong' size, especially now we have the cut in Housing Benefit when bedrooms are deemed to be surplus to requirements. Many of those getting into debt because of this 'bedroom tax' would willingly move to smaller accommodation, but there is none available. More social housing is desperately needed for single people and couples with no children. Laura from Sterling Store company.


Melbourne and Sydney in Down Under, are catching up with London with over-priced rents and over-rated hype from Real Estate Agents. Australia has 'negative gearing' , with a current property boom fueled by Chinese speculators!!! Australia is the Ass end of the world and should not be any where near as dear as London, yet 'negative gearing' has caused all of this!!! I heard the West Coast of America , is also catching up to Oz, with L.A. and Vancouver among the most expensive cities in North America. This 'colonial' issue matters, as many British ex-pats live in Australia & America. The Anglo-Saxon capitalist system is on it's knees and the mainstream media, under-report how bad things are becoming in the English speaking world, but instead concentrate on the Greek & Russian crisis. Don't underestimate the BRICS countries, America & the U.K. aren't that 'economically powerful' anymore. And who says we don't have corruption and tax dodging either? I know 2 English sisters (ex-pats) living in Australia, called Tina & Jill, who haven't paid tax over 10 years and their 80 year old mother draws 3 pensions (2 from the UK & 1 from Oz). I also heard London has more violent crime than all of the US cities together (even though America has liberal gun laws). Have A Nice Day...