Cost of Living: Germany vs. the UK - A Guide for Potential Movers

Considering a move from the UK to Germany? Despite the complexities introduced by Brexit, Germany continues to be a popular choice for British citizens seeking fresh opportunities, a higher quality of life, and a change of scenery. However, before taking the plunge, it’s crucial to understand the financial realities of living in Germany. 

It’s not enough to consider that the cost of living might be generally cheaper, you need to know where those differences exist, and how they might impact you.

Navigating the Post-Brexit Relocation Process

The rules for moving to Germany have changed significantly. You now require a visa or residence permit for stays exceeding 90 days, and the specific type of visa you'll need depends on your circumstances, such as whether you’re moving for employment, education, or to join family. It's critical to begin your research early, as these processes can take time. You can begin exploring your options by visiting the official website of the German Embassy in the UK. Understanding these requirements is a necessary first step and will affect your timeline for moving and your initial financial planning, so take time to get to grips with the latest regulations.

A Detailed Look at Key Cost of Living Comparisons

While it's challenging to provide an exact figure for every individual – as costs vary greatly depending on location within both the UK and Germany – we can offer some broad comparisons across key areas of expenditure. Your personal cost of living will be unique to your circumstances, but these comparisons offer a good baseline to start with.

1. Housing Costs: Renting and Buying

Rental Market

Generally, rental costs in Germany, particularly outside of major metropolitan areas like Munich, Frankfurt, and Berlin, can be noticeably lower than in comparable UK cities. The German rental market has several unique characteristics that are important to understand. In Germany, you will typically rent an unfurnished property – meaning often without even a fitted kitchen. 

Be aware of “Kaltmiete” (cold rent), which is the base rental fee, and “Nebenkosten” (additional costs) covering utilities like heating, water, and refuse collection, which are added on top. Rental contracts tend to be longer-term, typically for one or two years with built-in extension options, so it's important to ensure you're sure about your plans before signing. 

The UK rental market is far more flexible, but often comes with higher rental prices, especially in the cities. Rent includes utilities in many cases, but council tax will almost certainly need to be paid separately.

Property Purchase

If you are thinking of buying a property in Germany, you will find that prices are often significantly more affordable than in the UK, again, especially outside of the largest cities. This is an important consideration, as owning your own home is often a key step in building a life overseas. The south of Germany, especially the regions of Bavaria and Baden-Württemberg, tend to be the most expensive, and the cost of property in some major cities can be surprisingly high. 

It is worth taking some time to research specific regions before settling on your destination. In some areas you will find property far more affordable than anywhere in the UK, and even in cities you will find prices comparable to other large European cities, which can often represent better value than the UK.

2. Grocery Shopping: The Day-to-Day Basics

Germany

Grocery shopping in Germany is generally quite economical, especially when utilising budget supermarkets like Aldi and Lidl. You can expect to find high-quality fresh produce, a variety of bread, and dairy products at reasonable prices. Prices tend to be stable in Germany, with less promotional activity than in the UK. The cost of meat can be high, but other items are generally very affordable. There is also a range of mid-range and higher-end stores to choose from.

UK

While the UK also offers budget-friendly supermarkets, the typical weekly grocery shop in mid-range supermarkets tends to be more expensive than the German equivalent. You will also find a much wider range of ‘speciality’ ingredients in the UK, but these are generally more expensive. The cost of supermarket shopping is increasingly a concern in the UK, whereas in Germany, it remains remarkably stable.

3. Transportation: Getting Around

Germany

Germany is renowned for its efficient and reliable public transportation system, including trains, buses, trams, and subways, so getting around is generally affordable and easy to manage. Many cities have integrated transport networks, making it simple to use different modes of transportation and season tickets can be a worthwhile investment. Car ownership is common, but comes with similar costs to those in the UK, including insurance, fuel, and maintenance. If you have the option to use public transportation, you should definitely consider it.

UK 

Public transportation in the UK varies significantly by region, with London being particularly expensive and sometimes unreliable. Outside of London, bus and train networks can be less frequent, with generally higher costs. Car ownership is equally expensive, with congestion charges in many large cities adding to the cost of ownership. For those living in the cities, public transportation may be the better option.

4. Healthcare: Insurance and Access

Germany

The German healthcare system is a dual public-private system, meaning almost all residents must have health insurance. You'll typically be required to choose between public or private insurance, which is a significant contrast with the UK's NHS. Both options offer high standards of care, but it’s important to understand how to access healthcare in Germany. You will need to research your options before committing to a move.

UK

The NHS offers free healthcare at the point of use to all UK residents. While this is a benefit of living in the UK, waiting times and the quality of care are increasingly a concern for many, leading some to opt for private health insurance. This is, of course, an added cost. In Germany, you will need to factor in the costs of insurance.

5. Utilities: Gas, Electricity, and Internet

Germany

Utility costs in Germany (electricity, gas, internet, etc.) can be comparable to the UK, but there are some differences to consider. The German market is competitive, and it’s worth investing time in researching providers before making a decision. Many companies offer discounts for new customers, or bundled packages that include multiple services.

UK

The cost of utilities is similar to Germany, and you should shop around for the best deals before settling on a provider. However, costs are generally rising, and it’s important to budget for this.

6. Eating Out and Entertainment: Leisure Time

Germany

Eating out in Germany can be quite affordable, especially in traditional "Gasthäuser" (pubs) and beer gardens. This is a particularly enjoyable aspect of German culture, and offers a relaxed and sociable way to spend an evening or a weekend afternoon. However, prices in high-end restaurants in larger cities can be similar to or even higher than in the UK. It is important to plan your budget in such a way that accounts for this aspect of life in Germany.

UK 

Dining out costs in the UK are similar to those in Germany, with major cities like London being particularly expensive. Pubs and entertainment venues vary in price across the country, but are often comparable to Germany. Both countries have a vibrant restaurant scene, with plenty of options for a range of budgets.

7. Education: From School to University

Germany

Higher education at public universities is free for both domestic and international students. You may be required to pay a small semester fee, but this is significantly lower than the fees charged in the UK. This makes Germany a particularly attractive prospect for those who want to study or have children of university age. There are private schools, but these carry high costs.

UK

Higher education in the UK is expensive, with fees up to £9,250 per year for home students. Private schools are also extremely costly. This can be a significant factor for families considering a move.

Cost Comparisons

To help you visualise these differences, here's a table comparing typical costs across key categories:

Note: These are broad ranges, and actual costs will depend on your specific location, lifestyle, and spending habits.

Life in Germany: Beyond the Financials

It’s important to remember that moving to a new country is about more than just finances. Here are some non-financial factors to consider:

• Language: Although you might find some people in Germany who speak English, learning German is essential for an easier integration into everyday life, especially for employment. The level of German you require will vary from job to job, and from city to city, but for bureaucracy you will generally be expected to speak German. You can find resources for learning German through various online platforms.
• Culture: German culture emphasises punctuality, direct communication, and a focus on work-life balance. Being aware of these norms will ease your transition into German society.
• Bureaucracy: The process of settling in involves a number of administrative tasks. Be prepared to register your address, obtain health insurance, and complete other bureaucratic procedures. Patience is key here.

Financial Planning: A Pre-Move Checklist

Moving to a new country involves significant financial considerations. Careful planning is crucial for a smooth transition from the UK to Germany. Here's a concise checklist of key financial aspects to address:

Budgeting: Plan Thoroughly

Research specific costs in your German location, not just general averages. Create a detailed budget spreadsheet outlining both initial (visa fees, removals, deposits) and ongoing expenses. Include a contingency fund (10-15%) to cover unexpected costs. Use online tools like Numbeo or Expatistan for realistic local prices.

Savings: Build a Financial Safety Net

Calculate total moving costs (flights, temporary housing, removals) and secure at least 3-6 months of living expenses. This provides a buffer while you settle in and find work if needed. Consider an additional emergency fund for any unforeseen events.

Currency Exchange: Be Strategic

Monitor the GBP to EUR exchange rate closely and compare different transfer services like Wise or Revolut for better rates than traditional banks. Transfer funds strategically to take advantage of favourable rates and open a German bank account promptly after arrival.

Taxation: Understand Your Obligations

Research UK and German tax systems, understanding the implications of your new tax residency. Be aware of the UK-Germany double taxation agreement to avoid paying taxes twice on the same income. Obtain your German Tax ID (Steueridentifikationsnummer) after registering your address.

Financial Advice: Seek Expert Help

Consult a financial advisor experienced in international relocation, and consider a tax consultant specialising in both UK and German systems, especially if your situation is complex. Get this advice early in the process.

Moving with Deliver1

At Deliver1, we understand the complexities of moving overseas. We provide expert removal services for those moving to Germany from the UK, including door-to-door delivery, customs documentation, packing, storage, and insurance. Contact our experienced team to find out how we can help you with a smooth transition to your new life in Germany.

Moving to Germany offers exciting opportunities, and with careful planning and expert support, it’s a move you’ll be glad you made. We are here to help you every step of the way.