As I’ve previously covered, London is an expensive city.
Yet I don’t buy the idea that it’s necessary to spend all of my money every month – even as a student! Instead, I’ve discovered that with some simple lifestyle changes I can live comfortably and build up savings whilst studying for my PhD.
For those of you who haven’t started yet you can find details on how much PhD students earn here.
For a few years I’ve tracked my money each month but have never worked out how much of it goes where. In June I set up a Monzo account which should make it easier going forwards, and so here are my monthly expenses for September.
Housing – £592
Rent: £530.25
Utilities (water, gas & electricity): £32.90
Council tax* : £20
Internet and TV license: £9.17
I live in a house share near Clapham Common (a nice part of London), and share an ensuite room with my partner. Sharing certainly helps to cut down not just on my rent but also on bills. If you’re not in a couple you can still get rooms for under £650 including bills.
If you’d prefer to live on your own the price will depend a lot on what you’re after. As I’ve written here there are no-fuss options specifically for graduate students for around £950 per month including bills. For me personally I’m trying to be pragmatic and would prefer to share for a few years and pocket the ~£4000 a year.
*Students are exempt from paying council tax but I share with non-students and didn’t want them to be put off sharing with me if I said I wouldn’t pay what is essentially a very small amount of money. If you’re living amongst students you don’t need to worry about this!
Food & Drink – £143.50
Supermarket: £47.42
Abel & Cole Veg box: £55
Meals out: £22.08
Drinks out: £19
During term time I’ll also typically spend £10/month at the excellent student-run Imperial Food Co-Op
Almost all of my meals are home cooked which definitely saves me a lot of money. Plus, they’re really filling and I’m sure they’re more nutritious than most restaurant meals.
Every night I cook up a double portion of dinner and store half in a container for a lunch. If you’re really organised you can try and get a day or two ahead of yourself so you’re not having the same meal on successive days.
I get a weekly veg box delivered and have found these are a great way to ensure I’m eating enough veggies. Plus it means I get to conveniently support smaller businesses which I like since supermarkets can be pretty exploitative to their food growers. Loads of services exist: Riverford, Oddbox and Abel & Cole just being a few of them.
I usually bulk buy staple food supplies (rice, pasta, oats etc) at the Imperial Food Co-op. Between the veg boxes and buying staples at the food co-op I’ve cut my food costs and now only spend about £12 a week in a conventional supermarket.
In September I probably went out for fewer meals than usual because of friends and colleagues being away on holiday or at conferences. Although I really enjoy cooking my own meals I ought to say I am not against going out for a meal with friends!
Other expenses – £137.34
Travel – £16.90
SIM-only phone contract – £10
Matched-betting subscription* – £9
Gift for colleague – £5
Bike repairs – £35.98
Clothes – £6.50
Charity donations – £53.96
*This is an affiliate link, please read more about my policy relating to them here.
Since starting to cycle I’ve saved loads of money compared to catching the tube every day. I tend to only catch the tube if I’m going to a meeting somewhere else in London or if I’m off out after work. I had an issue with my bike chain this month which doesn’t usually happen. It did mean I had to spend a bit of money buying some tools and a replacement chain.
I pretty much exclusively shop for clothes in charity shops: not just because it saves me money, mostly because it reduces waste and of course helps out a good cause. One of my favourite chains of charity shops is Royal Trinity Hospice and there are lots of branches around London. If you’re currently on an expensive phone contract I’d suggest shopping around, I use MoneySavingExpert to check the best deals.
I make the conscious decision to donate money every month to charities I support, across a bunch of different causes. It’s a mix of monthly direct debits I have set up plus some one-off donations. Of course I could cut my outgoings by not donating but thankfully I can afford to do so and would sooner cut my outgoings in other parts of my life than reduce my donations.
Holidays – £259.20
In September I went to a few conferences and one of them was down on the coast in Southampton. Since I was already nearby I decided it would be a good opportunity to spend a long weekend on the Isle of Wight with my partner.
I’d always recommend trying to do similar things if you can, not least because I already had travel to and from Southampton paid for as part of the conference costs. Here is a post about the amount of annual leave I usually take.
Ferry crossing – £21.80
Three nights accommodation (I stayed here and would recommend it) – £86.40
Travel on the island (48hr bus pass) – £15
Food – £94.30
Activities – £41.70
If you’ve not been, I’d recommend going to the Isle of Wight – it was a lot of fun with loads to do!
Paying myself – savings & investments
With any left over cash I try to put as much money as possible in to savings. Although I am most certainly not a financial advisor, my suggestion is to look at ISAs and linked savings accounts. If you’re interested in saving for a home, Lifetime ISAs are great because you get a 25% bonus on up to £4000 each year.
Another tip is that many banks offer linked savings accounts if you transfer across your main current account to them. These linked accounts typically offer a decent interest rate for a year or two on a fixed amount each month.
Every month I pay in to:
Nationwide Flex Direct: 5% on £2500 plus 5% on £250 per month in the linked savings account. With typical interest rates closer to 1% this is a great deal! Nationwide also have a fantastic refer a friend scheme which allows you to earn £100 by opening an account, then an additional £100 for each friend you recommend (up to 5 per tax year).
As of April 2021 Nationwide sadly have paused this offer, even so if you ‘re interested in switching and want then please send me a message. My policy for affiliate schemes is detailed here.
I also have a First Direct Regular Saver which pays me 5% on up to £300 per month. However, it looks like the interest on this account has now dropped to 2.75% for new customers.
The best way to find the best bank accounts is on the MoneySavingExpert site. Because of new banking policies it is super easy to switch bank accounts, everything gets automatically transferred so don’t be put off!
With any spare cash on top of what I put in to these two I also pay in to a Triodos Fixed Regular Saver – which gives 1.75% on £25 – £500 per month. I’m a big fan of Triodos and they regularly rank at the top on Ethical Consumer.
So that’s banking. I also invest directly in stocks and shares and I’ll write about my investment strategy elsewhere. Currently I am investing monthly but mostly by transferring money from other accounts. In September I did add £150 to a few investments with Abundance which offers a small number of green investments.
Summary
In total my outgoings for September (not including any investments) came to £1132.36. Since this is outside of term time I may have gone out for fewer drinks and meals than normal, but it did include a relatively expensive weekend away. I certainly don’t average £250 a month on holidays, so if anything it was a more expensive month than usual.
As you can see, just over half of my outgoings are spent on housing. I’m happy to spend this amount and don’t think spending £600 all-in for a nice houseshare in London is excessive.
Starting to cycle every day has saved me just under £100 a month compared to catching the tube. Although I think by far the biggest way I save money compared to others is cooking my own meals. On my trip to the Isle of Wight I spent £95 on food in three days, I dread to think how much it would cost if I bought lunches and dinners out almost every day!
When I moved to London I was preparing myself to not be able to save money. Yet with outgoings of around £1100 a month, even on the typical current research council London stipend of £17,285 a year (£1417 a month) with no extra sources of income it would be possible to save £300 a month. If you supplement this with other income there is no reason you couldn’t save loads more.
I want to reiterate that I absolutely think everyone should make the most of all the opportunities available during the PhD to have fun, I just don’t buy the sentiment (even among my non-student professional friends) that trying to save money as a young person living in London is a lost cause.
Hopefully I’ve shown it’s possible to live comfortably and save money as a PhD in London!
I hope this post has helped if you’re nervous about money moving to London. Or maybe you already live somewhere quite expensive and want to reduce your outgoings? Whatever your situation, feel free to subscribe to get notified about new posts. You can also contact me to suggest any content you’d like included on the site.
What kind of meals are you eating that you spend so little?
Great question which probably deserves more than just a reply in a comment to answer! Quick answer: typically something like lots of veggies plus pulses or beans with rice, pasta or couscous. I’m not strictly vegan but eat that way at home and would say I eat cheaply but well, getting 5+ portions of fruit and veg every day thanks to a weekly veg-box delivery. I buy staples such as rice, pasta and oats for cost-price at a bulk food co-op we have at the university. I’ll do a food diary for a week and write a post about it. Thanks for asking!