Make it stretch

Mum regularly contributes to expat and relocation forums. Questions regarding the cost of living and monthly expenses in Australia are extremely common. We regularly read discussions regarding the minimum salary required to live in Australia’s most popular cities; in particular Sydney, Melbourne, Brisbane and Perth.

What income do families need to live in Australia?

At Mum’s gone 2 Aus we have already published a number of articles relating to the cost of living in Australia and monthly family expenses. To help families calculate the minimum income they require we thought it would be useful to share a reminder of the essential information we have provided so far.

Numbeo – online cost of living comparison

Another useful online tool that we recently discovered is Numbeo – a website providing cost of living comparisons. Mum compared London with Sydney and the majority of the cost comparisons are fairly accurate.

It would be interesting if readers could compare their town \ city of origin with where they live now and let us know how accurate the comparisons are. Visit Numbeo here to complete your comparison and please come back and tell us in the comments below what you think.

The magic number: family income required to live in Sydney

To return to the question we asked above “What income do families need to live in Australia?” we would like to attempt to answer this question. We’re concentrating on Sydney because that’s what Mum knows best.

One of the most critical factors influencing salary requirements is the cost of housing. We are basing our recommended salary on living somewhere within an hour of Sydney’s city centre and in a reasonable size property. We have used Numbeo’s figures in our calculations.

When discussing salaries with potential employers you will usually be told the salary package; this is inclusive of superannuation (pension) contributions. We have based our calculations on salaries that include super.

$120,000 – $150,000 per year (including super)

In Sydney, we feel families need a household income of at least $120,000 – $150,000 per year. Here is a breakdown of how we’ve come to this figure.

Basic monthly expenses for a family of 4 with 2 primary school children: Sydney, Australia

Disposable income of a family of 4 with 2 primary school age children: Sydney, Australia

In our experience the disposable income of a family of 4 gets eaten up very quickly with special occasions, outings and treats; and during your first few years in Australia you will incur setup costs (furniture etc) that will quickly leave you feeling the pinch.

Warning! If any of the following affect you, your household income will need to be significantly more than we have outlined above;

  • You want to live in one of the most expensive areas.
  • You want \ need to run two cars.
  • You want \ need to have regular overseas holidays.
  • You want \ need to use private schooling.
  • You have regular monthly payments on outstanding debts (credit cards, car loans etc).
  • If you have children in High School costs will be higher depending on subjects chosen and resources required.
  • If you have a child of preschool age you may also need to pay for two to three days a week of preschool which depending on where you live in Australia may be subsidised by the government and \ or you may be able to claim back some of the costs through Family Assistance payments.

On a positive note if you are permanent residents or Australian citizens earning $150,000 per year or less you will be eligible for Family Assistance payments and may receive up to $160 per week to help with the cost of raising your children.

What do you think? If you’re already living in Australia, do you agree with our cost of living and salary requirement calculations? What household income do you think families need wherever you live in Australia? Feel free to speak as broadly as possible, we don’t expect you to share your personal details here!

If you are currently planning your move to Australia please let us know if our articles and calculations have helped you, and whether you think there’s something we’ve forgotten to cover. Thank you.

Useful resources:

We have based our calculations on past research and first-hand experience as described in the Mum’s gone 2 Aus Money & Tax articles. We have used Numbeo to compare some costs and a useful table from RACQ on the cost of running a private vehicle in Australia. We used Career One pay rise calculator to compare take home pay.

Related articles:

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