July 2, 2008 | posted by Michael Baxter in Distribution of income |

So how much do you need to live on?

If you are a part of a married couple with two chidlers, then it’s £370 a week, after rent, or so says research from the Rowntree Foundation. 

To afford this budget on top of rent, living in a modest council home, the two parents–two children household needs to earn £26,800 a year before tax, according to Rowntree Foundation research, produced after interviewing a cross selection of the public.  

If you are on your own, then you need £158 a week, before rent, meaning you need a salary of £13,400 a year to cover your living expenses and rent.

So what does survival require these days?  Well, for your stereotypical, two parents–two kids, you need, among other things, £97.47 a week for food, £29.26 for clothing, but a whopping £186.98 for child care.  But what about having fun?  The report allocated £90 for what it rather grandly calls social cultural participation, and £6.06 for alcohol.

Rent was put down at £69.40, which assumes the family lives in this modest council home.

For families with no adult working, state benefits provide for less than half the minimum budget for single people and around two-thirds for those with children. The basic state pension provides a retired couple with about three-quarters of the minimum, but if they claim the means-tested Pension Credit their income is topped up to just above the minimum income standard.

The minimum income is above the official “poverty line” of 60 per cent median income, for nearly all household groups. This shows that almost everybody classified as being in poverty has income too low to pay for a standard of living regarded as “adequate.”

Mind you, if you have to drive to work, even if work is no more than a 20-minutes drive, it seems likely petrol alone will be £50 a week.  Car payments, so that’s tax, repairs, and actually paying for the vehicle, must come in at £250 a month.  So that would mean the total cost of travelling to work would add up to another £450 a month.  If you both drive to work and have a similar distance, but don’t work near each other, then total motoring costs would be £900 a month. 

Rent of just £69.40 a week seems very low.  If you were to rent a reasonable house big enough for the four of you, then surely £750 a month is the minimum rent.  So after paying tax, two people with two children who both drive to work may need to earn the £26,800 a year estimated by Rowntree, plus £10,000 a year for paying for cars and petrol, an extra £500 a month for rent, then tax, say £3,000, that is another £19,000.  All of a sudden, it appears that actually, some families, living a pretty frugal life style, will need a joint income of  £45,000.  And that seems quite a lot.