Germany is well-known for its high standard of living, excellent healthcare system, efficient public transport, and top-notch education system. The country offers an exceptional quality of life to expats, and the cost of living is also less than the cost of living in France, the UK, and some other European countries. That said, the cost of living does depend on the lifestyle you choose to adopt in Germany and the city you live in.
This guide will help you estimate the cost of living in the top three cities for expats in Germany based on the average costs for housing, education, health insurance, groceries, public transport, and more.
The General Cost of Living in Germany
Based on the data from Federal Statistics Office, German households spend an estimated €2,704 per month, assigning €908 to energy, and maintenance. Moreover, most Germans spend about €351 on transport, €356 on groceries, and €284 on leisure each month.
The country considers individuals earning less than €14,109 every year to be at risk of poverty. It amounts to about 15% of the population. Typically, single individuals, single parents, unemployed individuals, and people with a low level of education make under the stipulated amount each year.
Meanwhile, Germany’s estimated gross household income is €4,846 each month. For single individual households, the amount is €2,812 per month, with single men earning €500 more than single women. The average gross household income is around €1,000 more in former West Germany compared to former East Germany.
Now, let’s look at the cost of living in Berlin, inarguably one of the best cities in Germany and Europe, Munich, another incredible city, and Hamburg in Germany based on various factors.
Cost of Housing in Germany
Housing costs in the country are typically high but vary based on the type of property and area you choose to live in. For instance, the suburbs in Berlin have more affordable housing than the central Berlin neighbourhoods.
Moreover, the country doesn’t place any restrictions on expats buying property in Germany. That said, most expats choose to rent a place. The real estate industry doesn’t classify halls, kitchens, and bathrooms as rooms in Germany. So, if an apartment features four rooms, it will usually have two bedrooms, a dining room, and a living room.
Here is an overview of the rental costs of a 1-bedroom apartment in the city centres:
- Berlin: €960
- Munich: €1,280
- Hamburg: €1,028
Renting in Berlin is cheaper than renting an apartment in other central capital cities in Western Europe, such as London, Paris, Brussels, and more. The utility, television, waste disposal, and other charges are not part of the deal.
Costs of Utility Bills in Germany
Even though Germany has the highest electricity prices measured by the kilowatt-hour in Europe, the average German household doesn’t use much energy. In Germany, you receive utility bills quarterly. Here are the average monthly utility bills, including water, electricity, gas, and waste disposal, for an 85 square meter apartment:
- Berlin: €234
- Munich: €257
- Hamburg: €233
Moreover, monthly internet access in Germany costs around €30-€40 depending on your chosen package. The additional cost of living in Germany includes the mandatory German radio and television license.
Healthcare costs in Germany
Expats living in Germany are mandated to take out a basic German health insurance plan. The plan’s cost will depend on your age, coverage, and health insurance company. You can choose the cheapest health insurance in Germany by researching public health insurance or looking for more varied private insurance plans.
The basic plan for students starts at €110, and for professionals, it starts at €160-€400. You can also look at personal liability insurance in Germany that includes your medical insurance, legal fees, and liability insurance changes.
Cost of public transport in Germany
Germany offers a high standard of public transport that has a reasonable cost. Depending on the city you live in, public transportation can cost you around €60-€90 per month. Buses in Germany are slightly less expensive, but the fare depends on how far you go. Owning a car is undoubtedly more expensive than public transport.
Expats living in Berlin, Munich, and Hamburg don’t need to own a car. The taxi tariffs in Berlin start at €4, €3.70 in Munich, and €3.50 in Hamburg.
Taxes & Social Security in Germany
German residents pay personal income tax on worldwide income. Married individuals have to pay taxes on their joint income. Moreover, Germany has a progressive income tax that rises from 14% to 45%. The first €9,744 is tax-free, and there is a solidarity surcharge of 5.5% of tax. Meanwhile, the social security contributions are high in Germany.
For instance, you have to contribute 7.3% of your health insurance, 9.3% of your pension, 1.525% for your nursing care, and 1.2% for unemployment insurance. Depending on the private insurance you opt for, you can also include personal liability insurance coverage or personal accident insurance in the list.
Studying Costs in Germany
Some universities in Germany offer free education, and the public schools don’t charge any fees either. They are an excellent option for expats with younger children who can pick up the language quickly. On the other hand, the international schools in Germany demand expensive tuition fees that vary based on the institution’s prestige and grade levels.
The average cost is around €16,000 and can exceed €20,000 per year for comprehensive schools. On the flip side, bilingual schools cost around €500-€600 per month.
The Bottom Line
The cost of living in Germany for expats will depend on your choices, budget, and the city you choose to live in. Generally, housing costs a lot more in central Berlin and Munich compared to the suburbs. According to your set budget, you can manage the education, health insurance, utilities, and transportation costs.