Minimum Income Standards
The Joseph Rowntree Foundation has recently sponsored an investigation into minimum income standards. Details can be found here. I thought it would be interesting to review their conclusions for a single working age male, in particular comparing my own annual expenditure against their derived budget.



It is probably most revealing to study each area of the budget separately. The figures I quote in this post are all annual amounts. For my own expenditure: if I know how much I will spend in 2008 (such as for council tax) I have included that; if the amount I will spend in 2008 is uncertain, I have estimated it by taking a weighted average of recent years (allowing for inflation up to 2008 and giving greater weight to more recent years).

Food and drink

MIS: £2,508

Based on my expenditure for the first half of the year, I estimate that I will spend a little over £2,800 (12% higher) this year if I remain disciplined. Bearing in mind I feel I have a good quality balanced diet that I enjoy and almost always buy more expensive organic food where there is an option to do so this appears to suggest I am obtaining good value for money (this year I have mainly shopped at Sainsbury's).

Clothing and footwear

MIS: £329

My weighted and inflated average for the last five years is about £425 (29% higher). My clothing needs are very modest, but I tend to buy good quality clothing when I do buy anything. The MIS budget appears to assume more frequent and cheaper purchases.

Housing Costs

The MIS study assumes the individual is renting a Band A 1-bed council property in Loughborough. So it's not really comparable to my own circumstances. However, it's still interesting to compare the individual components.

Contents Insurance

MIS: £93

My expenditure on buildings and contents insurance this year will be about £175 (88% higher).

Council Tax

MIS: £696

My council tax bill will be about £925 (33% higher). Both of these include the 25% single person discount.

Decorating

MIS: £119

Note that this doesn't include furniture as that is covered elsewhere. This is difficult for me to compare as I rarely decorate. However, I would expect my annual average to be no more than, and probably less than, this.

Fuel for Heating

MIS: £470

My bills this year will probably come in at around £350 (26% lower). This is encouraging and suggests I am making efficient use of gas and electricity.

Rent

MIS: £2,729

It's hard to judge, but I guess I would be paying somewhere around £8,500 (over three times higher) if I rented my property. Part of this will be because of location and part because I live in a 2-bed semi rather than 1-bed flat.

Water Rates

MIS: £246

I will be paying about £425 this year (73% higher).

Household Goods and Services

MIS: £1,025

The MIS figure covers all sorts of things including furniture, fittings, kitchen implements, kitchen appliances, cleaning fluids, telephone charges. I estimate my annual expenditure is around £1,600 (56% higher), although this is based on a weighted inflated average of the past five years which may not be typical (it includes, for example, a new boiler and new guttering). The differential is in part a consequence of owning rather than renting the property.

Personal Goods and Services (including Health)

MIS: £313

I estimate my expenditure to be £575 (84% higher). However, mine includes health insurance, which is significant, and I would come out lower if I stripped this out.

Transport

MIS: £889

My average for the past five years has been £1,500 (69% higher). The difference probably arises mainly from the overheads of owning a car which I do not use much.

Social and Cultural Activities

MIS: £1,551

I estimate my expenditure to be about £2,000 (29% higher).

Overall, I appear to live above the minimum, but I suspect I am probably closer to it than many people. It is apparent that the area where I enjoy the biggest difference in my standard of living is in accommodation.