If you’re considering a move to Spain from the UK, one important factor to consider is the cost of living. Understanding the financial implications of such a transition is crucial for making informed decisions about your future. In this article, we’ll compare the cost of living in Spain and the UK, highlighting key areas where you may find differences and opportunities to make your money go further in the sun-kissed Spanish lifestyle.
Like everywhere in the world, the cost of living in Spain has gone up. Some things like fuel and energy shot up in the wake of the Russian invasion of Ukraine in 2022, but have since dropped back to where they used to be. Other things like food have stayed high and probably will not return to pre-2022 prices.
Housing Costs
One significant advantage of living in Spain is the relatively lower cost of housing compared to many parts of the UK. Property prices and rental rates can vary depending on the region, but in general, you’ll find more affordable options in Spain, allowing you to enjoy a higher quality of living within your budget. Like any country, the costs in cities are higher than if you live in a smaller town or the country. Consider living inland away from the tourist areas and your money will go much further!
Utilities and Services:
Utilities such as electricity, water, and internet services are generally more affordable in Spain compared to the UK. This can contribute to lower monthly bills and reduced household expenses, leaving you with more disposable income to spend on other aspects of your lifestyle. Things to consider though, you will spend less on heating, but may spend more on airconditioning in the summer. Also water is expensive here, so do not waste it. I changed my toilet flush to a water saving one, and it saved me 10 euros a month.
Electricity and gas cost us about 45€ per month. In the UK we paid around £200 per month, but our water bill was only £25 per month. In Spain we pay around €50 per month.
Internet, TV and mobile phones are largely the same as the UK. The best deals come from companies offering you two or three combined services rather than buying each from seperate companies. If you live out in the middle of nowhere you will need to get wireless internet which does cost more than regular broadband.
Food and Groceries:
When it comes to grocery shopping and dining out, Spain offers a range of options to suit different budgets. While certain imported products may be more expensive, local produce and everyday grocery items tend to be reasonably priced. Eating out at restaurants and enjoying tapas can often be more affordable in Spain, allowing you to savor the country’s culinary delights without breaking the bank. Eating out is definitely cheaper, and alcohol either in a restaurant or supermarket is crazy cheap. Check out my post about grocery shopping.
Transportation Costs:
Public transportation in Spain, such as buses and trains, is way more affordable compared to the UK (and better!). Spain has the largest high speed rail network in Europe and new sections are being added every year.
The cost of fueling your car is less too. For example at the time of writing, diesel was about 1.30€/litre, compared to the UK price of about 1.70€/litre.
The Spanish government helped in 2022 with a fuel subsidy which reduced the price of fuel by 20%. This expired at the end of 2022 but is a good example of how the government sees the importance of energy costs to the economy. They certainly did more to help than Rishi did in the UK!
Healthcare:
Spain boasts a highly regarded healthcare system, providing quality medical care to its residents. If you are becoming a resident of Spain and going through the visa process, you will need private medical insurance. This is about half the price of the equivalent in the UK.
We pay about 600€ per year for health cover as part of our visa qualification. Obviously this figure could vary greatly depending on any pre-existing health condition.
Leisure and Recreation:
Spain’s rich cultural scene, outdoor activities, and vibrant social life offer a wide range of affordable or even free leisure options. From exploring historic landmarks and museums to enjoying the beautiful beaches and natural parks, there are plenty of low-cost or no-cost ways to enjoy your leisure time in Spain. Attractions that do charge, are generally much cheaper. Not to mention the cost of parking, most of time you will not need to pay except in the cities.
Taxes:
Spain has a different tax system than the UK, and it’s essential to understand the tax implications of living in Spain. While tax rates can vary depending on your income and circumstances, Spain does offer certain tax benefits and incentives for foreign residents, which can positively impact your overall financial situation.
The equivalent of council tax is MUCH cheaper than the UK. We paid 260€ for our property tax this year, compared to over £2000 for our UK council tax.
Other taxes to consider our whenever you buy and sell a house or car, there are transfer taxes to be paid. These are around 10% of the purchase value of the asset. If you buy a property in Spain, allow 15% for taxes and other costs for the transaction.
If you are working in Spain you will see that income tax allowances are much less generous than the UK. However there are additional allowances you can claim. Definitely get professional advice about this stuff!
In general, overal taxation is higher than the UK, and this causes a grey economy where you can pay for goods and services in cash (or “en efectivo”) for a discount. Obviously this is something that I am not advocating — just letting you know it goes on as a direct result of burdensome taxation.
Conclusion
Moving to Spain from the UK can offer numerous financial advantages, with a potentially lower cost of living across various aspects of daily life. From housing costs and utilities to food, transportation, healthcare, and leisure activities, you may find that your money goes further in Spain, allowing for a comfortable and enjoyable lifestyle.
However, it’s important to research and consider all aspects of your financial situation, including income, taxes, and personal preferences, to make an informed decision that aligns with your individual needs and goals. By understanding the financial implications and benefits, you can embark on your Spanish adventure with confidence and peace of mind.
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