How much money do you actually need to live off?

£10,000? £20,000? £30,000?

Have you ever thought about how much money you actually need to have a decent standard of living?

The Joseph Rowntree Foundation (JRF) has worked out the Minimum Income Standard (MIS) for 2018.

This is based on what the public thinks we all need for an adequate minimum living standard – including food, travel, rent, energy bills, childcare and more.

What do you need to live off?

  • A single adult needs £18,400 before tax and benefits
  • A single parent with one child needs £28,450 before tax and benefits
  • A single parent with two children needs £35,200 before tax and benefits
  • A family of four needs £40,000 before tax and benefits

2008-2018

The report from JRF also shows how prices have risen considerably faster than wages over the last 10 years.

Low income families now need a third more in disposable income than a decade ago to make ends meet.

Since 2008, costs have risen 35% for single working adults, 30% for couples with two children and by 50% for a pensioner couple.

Travel, energy, childcare and food are some of the sectors with rapidly increasing prices.

Bus prices, for example, are 65% more expensive than in 2008, meaning a single adult will now spend £37 a week on transport compared to £17 in 2008.

On top of this, the average price of a full-time nursery place has risen by well over 50% to £229 a week and food prices have also risen by 50%, from £29 to £44 a week for a single adult.

cost of living

Minimum Wage not enough?

Despite National Living Wage and Minimum Wage increases, many working parents are actually getting further away from reaching the MIS.

In 2008, a single parent working full-time on the minimum wage and helped by tax credits was £520 short of the MIS. In 2018 they are £3,640 short.

A couple both working full-time on the minimum wage with two children will be £2,600 short of what they need, and a single breadwinner family with one full-time worker on the minimum wage will be £6,240 short.

Pritie Billimoria, Head of Communications at Turn2us, said:

“A ‘decent standard of living’ is a dream away for most of the people we help. Over 1.5 million people who came to us in the last 12 months have incomes of less than £10,000 a year, let alone the minimum income standard.

“If nothing is done to tackle the low wages, high rents, crippling transport costs, unaffordable childcare and ever increasing food and energy bills that are behind this high cost of living, we will see more people make the impossible decision whether to eat or pay the rent.”

Source: Turn2us

Two-thirds of low income workers with disabilities struggle to afford to heat their homes

New research by the national charity Turn2us has found that over two-thirds (67%) of people with disabilities on low incomes are struggling to afford their energy costs, despite being in work.

Worryingly, of those who are struggling, over half (51%) have done so for more than a year.

The research reveals that nearly two-fifths (37%) of all low income workers with disabilities have missed one or more payment to their energy supplier in the last twelve months. Over a quarter (29%) are struggling with other essential bills, with Council Tax topping the list of payments they’re behind on (32%).

As the weather turns colder, the research also uncovers how low income workers with disabilities will cope with these costs through the winter. Of those worried about their energy costs, a huge 72% feel they will have to cut back on or not use their heating, whilst over half (53%) said they would resort to cutting back on food. A third (33%) anticipate that the stress of energy bills will exacerbate their health problems.

There are 2.3 million households living in fuel poverty in England alone*, and it is estimated that nearly half of these are in work.** As debate continues around proposed cuts to the tax credits system, there is growing concern that household finances could be even harder hit from next year.

Turn2us’ research also suggests a lack of awareness of the help that could be available to disabled people on low incomes, or potential reluctance to access it. Of those who are struggling to pay their energy costs, only 7% have turned to an advice organisation for help. Almost three-quarters (72%) have not checked their eligibility for welfare benefits in the last twelve months, whilst 76% are unaware that some energy suppliers have charitable trusts set up to help certain customers.

Heating BillsThis winter, Turn2us is running its No Cold Homes campaign specifically to help more people who are unable to afford to heat their homes. The charity is encouraging anyone in financial hardship to use its free online service to see if they are eligible for welfare benefits, charitable grants and other support – additional income which could help them manage their energy costs over the colder months.

Simon Hopkins, Chief Executive of Turn2us said: “Our research paints a startling picture, revealing the extent to which families are struggling to heat their homes, even though they’re in work. It is clear that more needs to be done to help raise awareness of the financial support and other help available to people on low incomes to help them manage their energy costs.

We know that this is an issue that affects a wide range of people, and alongside working households, many others will suffer this winter. We believe that no one should have to live in a cold home. Through our campaign, we urge anyone struggling to check what support could be available.”

The No Cold Homes campaign runs from 18 November to 16 December 2015. As part of the campaign, Turn2us is hosting an online celebrity clothes auction (30 November – 9 December) to raise awareness of people’s struggles to heat their homes, and funds to help more people affected.

For more information, please visit www.turn2us.org.uk/NoColdHomes.

“It seems this issue has become a seasonal fixture”