France is one of the countries with the highest minimum wages in the world and therefore a higher level of salaries than in many countries. The cost of living is of course proportional to this level of salaries, so I wanted to write this post to try to explain more in detail the cost of living in France.
Monthly budget in France
Making a budget is complicated, since not all people spend the same on the same things and everyone’s priorities are different. The money we spend, and how we spend it, also depends on the level of income.
I could speak from my experience, but, as I already mentioned, not all of us spend the same and my expenses might seem excessive on some items, or very low on other items. To try to do a less subjective exercise and get a more global idea of the cost of living in France, I built a budget based on two references:
- Average consumption of French households according to INSEE: This study, carried out by the French National Institute of Statistics and Economic Studies, calculated the average consumption of French households, and the percentage of their budget that they allocate to different items;
- ONPES Reference Budget: The National Observatory on Poverty and Social Exclusion created a reference budget by family type, with the minimum amounts in each item, necessary for an effective participation in social life.
Based on these sources I built a monthly budget that is composed of the following items:
- Food: Includes monthly groceries expenses, as well as alcohol (bought in supermarket) and cigarettes;
- Wardrobe: Includes annual clothing expenses divided into 12 months;
- Rent: Monthly rental expenses;
- Furniture & home equipment: Annual expenses in furniture for housing divided into 12 months;
- Health: Monthly health expenses (“mutuelle” or complementary insurance);
- Transportation: This budget assumes that you own a car, so it includes car’smaintenance costs;
- Communications: Telephone and internet expenses;
- Leisure: Night outs, bars, movies, restaurants and weekend trips;
- Education: Children education expenses, assuming they attend public school;
- Others: In this item I include other unspecified expenses, unforeseen expenses, bank fees, hairdresser, taxes (taxe d’habitation), etc…
Monthly budget in France by family type
To find out the cost of living in France according to the type of family, I calculated a reference budget for three types of family:
- Single person: The reference budget for a single person is € 1,640 per month;
- Couple without kids: The reference budget for a couple without children is € 2,301 per month;
- Couple with two kids: The reference budget for a couple with two children is € 3,830 per month.
It is important to clarify that these budgets are calculated with average amounts and are only intended to give a general idea of cost of living in France. Rent, which is the most important part of the budget in France, is also an average amount for an intermediate city, in Paris this cost should be increased by at least 30%. This reference budget also does not consider social aids that can help, for example, reduce rental costs, as I explain in this post.
Budget calculator in France
To make calculations easier, I created a budget calculator based on INSEE and ONPES data. All you must do is fill in the orange cells, selecting the type of family and entering the amount of net income per month (to convert your gross salary to net, you can go to this website).
Once these data are entered, the calculator will estimate the distribution of your income for each of the different items (column B) according to the percentages calculated by INSEE (Column A). In addition to this, in column C you will find the amounts per item according to the reference budget and column D will calculate the difference between the distribution of your income according to INSEE and the reference budget (column B minus column C), and will tell you by how much you fall short or exceed the reference budget. Finally, everything is summed up and the calculator tells you how much you would have left or fall short at the end of the month, and what would be yoursavings capacity.
You can also modify amounts in column C based on your own budget to go further in the budget analysis.
Example: is it possible to live on the minimum wage in France?
To illustrate the use of the calculator and how to calculate a budget. I will make an example of a single person earning a minimum wage.
For doing so, I select “Single person” in family type and enter an income of € 1,200 that corresponds to the net monthly minimum wage in 2020. You can see the results in the following image:
As you can see in the image, based on the reference budget, the minimum wage would not be enough to cover the minimum amounts of most items. According to this calculation, there would be a shortfall of € 440 per month. However, there are some items in which there is a surplus that can be used to balance the budget in other items. Rent budget in column B is also quite low compared to the reference budget. As I already mentioned, this calculation does not consider social aids and neither does the fact that this person could apply to social housing that are cheaper. With these and other adjustments it is possible to balance the budget. Another example is transaportation, because this budget considers having a car, if this person used only public transportation that would drastically reduce this item.
In conclusion, the answer to the question: is it possible to live on the minimum wage in France? is yes, however, with some degree of precariousness though. Perhaps not at the same level as in other less developed countries, but the saving capacity would be low, and access to a rent an apartment would also be difficult since this person would need a guarantor to be able to rent since their income is not the equivalent of 3 times the rent amount. Again, each budget is personal, and these are reference amounts, leading a more austere life it would be possible to spend less and even save with this salary, so it depends on the lifestyle of each person.
I hope this post has been helpful and has given you more information on the cost of living in France. The idea is that you can also use this calculator if you are evaluating a a salary proposal in France and adjust it according to your lifestyle or your savings objectives to evaluate how much your income should be.
Any contribution or question please do not hesitate to leave it in the comments below.