Originally published at: Navigating the Cost of Living in Germany: The Essentials for Newcomers | GoVisaFree
Germany is a popular destination for migration since the 1950s and 1960s, during the industrial boom, following the agreements with countries like Italy and Turkey to bring in foreign workers. In the late 1960s and early 1970s, there was a significant influx of immigrants for family reunification purposes. After a long period of time and deep sociological analysis, many adaptation and integration programs are developed and the consensus was reached among major political parties that Germany was now a country of immigration. Just after the war between Ukraine and Russia more than 1.1 million people from Ukraine are known to have resided in Germany.
Germany, which gives almost as much to people as it receives, is still a very attractive country for many people because of its long-established immigration and integration policy, job opportunities, and the continued need for young people in the country. But what is the “price” of settling there?
How Expensive Is It To Live in Germany?
As Germany still attracts many people for its exceptional quality of life, it comes at a price. The cost of living in Germany is strictly dependent on the region, lifestyle, and personal expenditure. Briefly, accommodation is the most expensive item, with higher rental prices in major cities such as Berlin, Munich, and Hamburg compared to other areas. Food and grocery prices are generally reasonable and comparable to those in other European countries. Public transportation is dependable and affordable, although fuel prices for private cars are expensive. Healthcare is accessible to everyone in Germany, and there are options for both public and private insurance. Education is largely free, and university tuition fees are waived for German and foreign students. Leisure and recreation options are abundant, but costs may fluctuate depending on the activity and location. In this article, we will explore these headlines separately to truly understand the true cost of living in Germany, which can be high but may be possible to maintain.
Exploring the cost of living in Germany is crucial for expats, digital nomads, and students considering relocating to the country. Germany has been a popular destination for migrants for a long time due to its thriving economy, excellent educational institutions, and high quality of life. By gaining insight into the cost of living, potential residents can better prepare themselves for their new life in Germany and ensure a smooth transition. So, if you are ready, let’s start to dig in!
Housing
The cost of living in Germany can vary depending on the region and lifestyle, and one of the most significant expenses is housing, with rental prices being higher in big cities like Berlin, Munich, and Hamburg compared to other areas.
In terms of rental costs, the average costs of monthly rent for a one-bedroom apartment in Berlin is around €900, while in Munich, it can cost up to €1,500 per month. On the other hand, smaller cities like Leipzig or Dresden have more affordable rental prices, with a monthly average rent of around €500 for a one-bedroom apartment. Of course, the size of the apartment and its location within the city will also affect the rental cost.
Several factors affect the cost of housing in Germany, such as location, size of the apartment, and the level of demand in the market. In large cities like Berlin, where the demand for housing is high, the cost of living is generally more expensive. In other words, the competitive market ruins it once again for everyone who wants to taste the place that everyone has been talking about. As usual, apartments that are located in central areas or close to public transportation tend to be more expensive than those in quieter neighborhoods further away from the city center. The size of the apartment is another important factor, with larger apartments costing more than smaller ones.
In addition to the rental cost, there are other expenses associated with housing in Germany. Utilities such as water, electricity, gas, and internet are usually not included in the rent costs and can add a significant amount to the monthly expenses. Internet prices vary depending on the provider and plan chosen.
For those who prefer shared housing, it is worth noting that there is a legal requirement in Germany that each person has a specific amount of living space. For example, for each family member under 6 years old 10m2, and for others over 6 years old 12m2 of living space should be proven to be provided in the house. However, again due to the high demand and low supply, different regulations have been prepared for Berlin, 6 m2 for each child up to 6 years and 9 m2 for the older kids.
In conclusion, understanding the rental market and additional expenses associated with housing is crucial for those considering moving to Germany, as it can significantly impact the cost of living.
Housing |
Average |
Range |
|
One-Bedroom Apartment in the City Center |
839.86 € |
544.33-1,400.00 |
One-Bedroom Apartment Outside the Center |
630.02 € |
397.08-1,048.66 |
|
Three- Bedroom Apartment in the City Centre |
1,564.77 € |
1,000.00-2,507.40 |
|
Three-Bedroom Apartment Outside the Center |
1,180.68 € |
800.00-2,000.00 |
Transportation
Germany is a country with a well-established transportation system that offers a variety of options for people to get around. One of the most popular options is public transportation, which includes buses, trains, and trams, connecting all major cities and towns, making it easy for people to travel between different locations. The local transport system is also affordable, especially for students and seniors who receive discounted fares.
Another transportation option available in Germany is car ownership which is surprisingly not very encouraged when compared the costs. Although it is the birthplace of many famous car brands like BMW, Mercedes-Benz, Volkswagen, Audi, Porsche, and Opel, and many people in Germany own cars, car ownership in Germany is still expensive, with the costs of buying and maintaining a vehicle adding up quickly. In addition to the initial purchase price, there are additional costs such as parking fees and car insurance that need to be considered. It is important to note that public transport usage is being encouraged instead of private car use, especially when considering the impact of transportation on the environment. The transportation sector is one of the major contributors to greenhouse gas emissions, which contribute to global warming and climate change. Encouraging the use of public transportation is an important approach to reducing these emissions, as public transport is much more efficient in terms of fuel consumption and emissions per passenger than private cars.
When it comes to comparing public transport costs in different cities in Germany, there can be significant differences. For example, cities like Berlin and Hamburg have highly developed public transportation systems that are both affordable and efficient, making them popular choices for commuters. On the other hand, cities like Munich and Frankfurt have a more expensive public transportation system, which may still make car ownership a more attractive option for some residents. However, gasoline prices are not very cheap, either.
In a nutshell, Germany offers a variety of transportation options for people to choose from, including public transport and car ownership. With the impact of transportation on the environment, usage of public transportation is encouraged with big discounts instead of private car use.
Purchased Item |
Average |
Range |
|
Meal, Inexpensive Restaurant |
12.00 € |
8.00-20.00 |
|
Meal for 2 People, Mid-range Restaurant, Three-course |
52.00 € |
40.00-90.00 |
|
Grocery Shopping – Whole package Dairies, Meat, Vegetables and Fruits |
54.79 € |
27.16-97.95 |
Food and Groceries
When it comes to grocery prices, Germany is generally affordable compared to other European countries. A comparison of grocery prices in Germany to other countries shows that the cost of living is relatively low, with a standard basket of goods having cheaper prices in Germany than in many other countries. On average, a single person can expect to spend around €200-€300 per month on food, while a family of four may spend between €600-€800 per month. Vegan and vegetarian options are becoming increasingly popular in Germany, with many supermarkets and restaurants offering a variety of plant-based products at affordable prices as well.
When it comes to eating out, Germany generally offers inexpensive restaurant prices. A comparison of restaurant prices in Germany to other countries shows that the cost of eating out is relatively low, with a three-course meal for two people costing around €50-€70. Restaurant prices may be higher than in smaller cities or rural areas. Vegetarian and vegan restaurants are also becoming more common in Germany and they are available for every budget.
In short, food expenses in Germany are generally affordable, with grocery prices and restaurant prices being relatively low compared to other countries. Due to the challenges posed by the COVID-19 pandemic food and grocery prices had increased noticeably, but Germany continues to offer a diverse and thriving food scene, with plenty of options for both locals and visitors alike.
Purchased Item |
Average |
Range |
|
Meal, Inexpensive Restaurant |
12.00 € |
8.00-20.00 |
|
Meal for 2 People, Mid-range Restaurant, Three-course |
52.00 € |
40.00-90.00 |
|
Grocery Shopping – Whole package Dairies, Meat, Vegetables and Fruits |
54.79 € |
27.16-97.95 |
Purchased Item |
Average |
Range |
|
One-way Ticket (Local Transport) |
2.90 € |
2.40 – 3.70 |
|
Monthly Pass (Regular Price) |
70.00 € |
55.00 – 100.00 |
|
Taxi Start (Normal Tariff) |
3.50 € |
3.00 – 5.00 |
Healthcare
Germany is known for its high-quality healthcare system, which is based on the principle of social insurance. This means that everyone employed or self-employed in Germany is required to have health insurance. There are two types of health insurance in Germany: statutory health insurance (SHI) and private health insurance (PHI).
Statutory health insurance is the most common form of health insurance in Germany. It is provided by nonprofit funds, which are funded by contributions from both employers and employees. The cost of SHI is based on a percentage of the employee’s gross salary, with the employer covering half of the cost. The coverage provided by SHI is standardized across all funds and includes a wide range of medical services, such as doctor’s visits, hospital stays, and prescription drugs.
On the other hand, private health insurance is an option for those who earn more than a certain income threshold or are self-employed. PHI offers more flexibility in terms of coverage and can be tailored to the individual’s needs. However, it can also be more expensive, especially for older individuals or those with pre-existing conditions.
For expats, it is important to note that they are required to have health insurance in Germany and exactly the same conditions are valid for them. So, it is important to compare different insurance options and costs before making a decision.
When it comes to healthcare costs, Germany has a relatively low cost compared to other developed countries. According to the World Health Organization (WHO), Germany spent around 11% of its GDP on healthcare in 2019, which is lower than countries like the United States and Switzerland. However, the costs of healthcare in Germany have been increasing in recent years, and there have been debates about how to contain these costs while maintaining the quality of care.
To summarize, Germany’s healthcare system is based on social health insurance, with both SHI and PHI options available. Expats should compare insurance options and costs before choosing a plan and it has relatively low healthcare costs compared to other developed countries.
Education
The education system in Germany is highly regarded for its quality and diversity. Education in Germany is compulsory for all children from the age of 6 until the age of 18. The German education system is split into four main levels: kindergarten, primary school, secondary school, and tertiary education.
Kindergarten is for children aged 3-6 years old and is not compulsory. Primary school, known as “Grundschule”, is for children aged 6-10 years old and teaches basic subjects such as German, maths, social studies, and foreign languages. Secondary school is split into three different types of schools: Hauptschule, Realschule, and Gymnasium. Hauptschule teaches basic subjects and prepares students for vocational training, Realschule provides more practical education and prepares students for vocational training or further academic education, and Gymnasium is the most academically demanding and prepares students for university.
Both public and private schools exist in Germany, but the majority of students attend public schools which are free of charge. Private schools, on the other hand, can be very expensive and often offer a more exclusive education. However, public schools in Germany provide a high standard of education, and it is not necessary to attend a private school in order to receive a quality education.
University education in Germany is also highly respected. Unlike in most countries in Western Europe, university fees in Germany are relatively low and students only have to pay a small semester fee which covers administrative costs, student services, and social contributions. Additionally, many universities offer scholarships to students based on academic performance or financial need. German universities offer a wide range of subjects, and students can choose from over 300 institutions of higher education across the country. Academic life in Germany is structured and rigorous. Students are expected to attend lectures, seminars, and tutorials regularly, and to keep up with the reading and assignments. However, there are also many opportunities for extracurricular activities and socializing.
Overall, the education system in Germany offers a high standard of education across all levels, and the relatively low cost of university fees makes higher demand.
Entertainment and Recreation
The cost of entertainment in Germany varies depending on the type of activity, the city, and the time of year. To begin with, movie tickets and concert tickets are popular forms of entertainment in Germany. The average cost of a movie ticket in Germany is around 10-12 euros, depending on the city and the time of day. For example, tickets are usually cheaper during the day and more expensive in the evening. Concert ticket prices range from 20 to 100 euros, depending on the popularity of the artist, the venue, and the location. The cost of food and drinks at these events can also add up quickly, with a typical drink costing around 4-5 euros and a snack costing around 7-10 euros.
When comparing recreational costs in Germany to other countries, it is important to consider the cost of living and the local currency. In general, Germany is considered to be an affordable destination for tourists, especially compared to other European countries like Switzerland or Scandinavia. However, it is also worth noting that the cost of living and entertainment expenses in major cities like Berlin or Munich can be higher than in smaller towns or rural areas.
One of the most famous cultural events in Germany is Oktoberfest, which takes place in Munich every year in September and October. The festival attracts millions of visitors from all over the world, who come to enjoy traditional Bavarian food, beer, and music. The cost of attending Oktoberfest can vary depending on the day and the time of day. During the weekends and in the evenings, prices for food and drinks can be higher than during the week or in the morning. It is also important to book accommodation well in advance, as hotels and hostels can fill up quickly and become more expensive closer to the festival.
In conclusion, Germany offers a diverse range of entertainment options, from movies and concerts to cultural events and festivals like Oktoberfest. It is important to note that, the local currency and the cost of living in large cities, as well as the associated costs of attending cultural events and festivals, may have different meanings in terms of affordability.
Purchased Item |
Average |
Range |
|
Fitness Club, Monthly Fee for 1 Adult |
32.70 € |
20.00 – 60.00 |
|
Tennis Court Rent (1 Hour on Weekend) |
20.85 € |
12.50 – 28.00 |
|
Cinema, International Release, 1 Seat |
12.00 € |
9.00 – 15.00 |
Living Costs in the Major German Cities
Germany is known to be one of the most expensive countries in Europe for its residents, but it also makes many services available without an extra payment so it is important to take a look at the major cities, namely Berlin, Munich, Frankfurt, Hamburg, and Cologne, to be fair. In terms of daily living expenses like transportation and food and groceries, the prices in these cities are relatively high, especially in Munich and Frankfurt. A monthly public transportation pass in Munich can cost up to €54, while a monthly pass in Frankfurt is around €80. As for food and groceries, the prices are similar in all German cities. A loaf of bread costs around €1-€2, while a liter of milk costs around €0.70-€1.
Housing rent is one of the significant living costs for most people in these cities. The rental prices in Berlin and Cologne are relatively affordable compared to Hamburg, Munich, and Frankfurt. In Berlin, the average cost of a one-bedroom apartment is around €700, while in Cologne, it is around €800. In contrast, in Hamburg, the average cost of a one-bedroom apartment is around €1,000, while in Munich and Frankfurt, it is around €1,300-€1,500.
Regarding education, Germany has free public education, which includes primary and secondary schools, and universities. However, private schools and universities can be expensive, with tuition fees ranging from €5,000 to €20,000 per year. This is the part where Germany totally wins the game.
Healthcare is mandatory in Germany, and the public healthcare system is known to be one of the best in the world. The cost of healthcare depends on the individual’s income and insurance coverage. Typically, individuals pay a percentage of their income towards healthcare, which ranges from 14-15%. So an available health service is mandatory, which, in long term, prepares its residents for every kind of surprise.
Finally, entertainment and recreation expenses in these cities can vary, depending on the individual’s preferences. Berlin and Cologne are known for their affordable nightlife, while Hamburg, Munich, and Frankfurt can be relatively expensive cities to have a fun night out. The cost of cinema tickets ranges from €8-€12, while a meal for two in a mid-range restaurant can cost around €50-€80.
Living Expenses in Germany: The Endnote
The final cost of living in Germany varies significantly due to the chosen place. Daily expenditures like transportation and food and groceries are relatively high, and rent and entertainment expenses can be costly in big cities. However, the free public education system and the excellent public healthcare system in Germany can help offset some of these expenses.
Managing expenses in Germany can be a challenging task, especially for expats or students who are new to the country. However, here we have prepared a guideline that can help you cut back on your expenses and manage them effectively.
It is crucial to create a budget and stick to it. Creating a budget helps to identify necessary expenses, cut down on unnecessary ones and keep track of expenses regularly to ensure that you are not overspending.
You should always compare prices before making purchases in all aspects. With the rise of online shopping, it is easier to compare prices from different stores, which can help you save money in the long run.
Always take advantage of public transportation instead of owning a car, it can save a significant amount of money and will definitely be good for your and the world’s future. Germany has an efficient public transportation system, and owning a car is already expensive due to high fuel prices, insurance, and maintenance costs.
It is also advisable to get used to cooking at home instead of eating out regularly. Another useful tip will be to buy groceries in bulk and take advantage of discount offers to economize on food expenses.
Lastly, it is important to look for ways to save on rent expenses. Living in shared accommodation can significantly reduce rent expenses. It is also advisable to look for accommodation in areas outside the city center, as renting in those areas is a cheaper option.
No surprise, but in conclusion, managing expenses in Germany requires some kind of German discipline and careful planning. There is a reason behind the common knowledge of what the people of every country are the best at.
FAQs
The cost of living in Germany varies depending on the city, with some cities being more expensive than others. Here are some of the cheapest German cities are Leipzig, Duisburg, Chemnitz, Hanover, Bochum, Halle (Saale), Bremen, Essen, Gelsenkirchen, and Magdeburg.
These cities have lower living costs compared to larger cities like Berlin, Munich, and Hamburg. However, it’s important to note that the cost of living can still vary depending on individual lifestyle choices and spending habits.
The most expensive cities in Germany are Munich, followed closely by Frankfurt and Hamburg, respectively. These cities have high costs of living due to their strong economies, high salaries, and desirable locations. In addition to housing costs, the prices of goods and services, such as dining out, transportation, and entertainment, are also higher in these cities compared to other parts of Germany.
Here are some tips to help you manage your expenses effectively:
- Create a budget: The first step to managing your expenses is to create a budget. This will help you identify the average monthly cost of living in Germany by taking your income, fixed expenses (such as rent, utilities, and insurance), and variable expenses (such as groceries, entertainment, and transportation) into account. Make sure to include any annual or monthly costs, such as taxes or membership fees, in your budget.
- Prioritize your expenses: Once you have created a budget, prioritize your expenses based on their importance. This will help you identify areas where you can cut back if necessary. For example, you may want to reduce your entertainment expenses to put money aside for more important expenses, such as rent or healthcare.
- Use public transportation: Germany has an excellent public transportation system, including buses, trains, and trams. Using public transportation can save you a lot of money on transportation costs. You can also consider buying a monthly or yearly pass, which can be cheaper than buying individual tickets.
- Shop at discount stores: Germany has many discount stores, such as Aldi, Lidl, and Netto. These stores offer affordable groceries and household items, which eases saving money on your daily expenses.
- Compare prices: When shopping for larger purchases, such as electronics or appliances, compare prices from different retailers. You can also check online retailers, such as Amazon or eBay, for better deals.
- Cook at home: Eating out in Germany can be expensive, especially in bigger cities. Cooking at home is a great way to save money on food expenses. You can also take advantage of local markets to buy fresh produce and ingredients at a lower cost.
- Consider sharing expenses: If you live with roommates or family members, consider sharing expenses such as rent, utilities, and groceries. This can help reduce your overall living expenses.
The cost of housing in Germany can vary greatly depending on the location, size of the apartment or house, and other factors. Generally speaking, housing costs tend to be higher in major cities such as Berlin, Frankfurt, and Munich. As a rough estimate, you should budget around 30% to 40% of your monthly income for housing expenses. This includes rent, utilities, and other housing-related expenses such as internet and insurance.
According to statistics taken from Eurostat, Germany’s GDP (Gross Domestic Product) is slightly above the European general, while price levels and food prices are relatively average. Also, government expenditures are slightly above the EU average as well, which shows, Germany is not a cheap country to live in but has an improved view of the social state.
European Union |
Euro Area |
Germany |
|
Inflation Rate |
2,9% |
2,6% |
3,2% |
|
GDP per capita (Euro per inhabitant) |
27.880 € |
30.890 € |
35.480 € |
Electricity prices |
252,5 € |
260,8 € |
327,9 € |
Here are some of the most important taxes to keep in mind:
- Income tax: Income tax is a progressive tax that is based on your income. The tax rate can range from 0% to 42%, depending on your income level. In addition to federal income tax, you may also be subject to state and local income taxes.
- Value-added tax (VAT): VAT is a tax on goods and services that is included in the price of most items you purchase in Germany. The standard VAT rate is currently 19%, but there is also a reduced rate of 7% for certain items such as food, books, and newspapers.
- Solidarity surcharge: The solidarity surcharge is an additional tax that is levied on top of income tax and is used to support the costs of German reunification. The surcharge is currently set at 5.5% of your income tax bill.
- Property tax: If you own property in Germany, you may be subject to property tax. The tax rate varies depending on the value of your property and the local tax rate.
- Capital gains tax: If you sell investments such as stocks, bonds, or mutual funds for a profit, you may be subject to capital gains tax. The tax rate can range from 0% to 25%, depending on how long you held the investment.
It’s important to keep in mind that taxes can have a significant impact on your overall cost of living in Germany. When planning your budget, be sure to factor in the cost of taxes.
- Kindergarten: Kindergarten (pre-school) is generally subsidized by the government and therefore relatively affordable. The cost of kindergarten can vary depending on the region, but on average, you can expect to pay between 0€ and 300€ per month.
- Daycare centers (Kita): Daycare centers are also subsidized by the government, but the cost can vary depending on the region and the number of hours your child attends. On average, you can expect to pay between 100€ and 500€ per month for daycare.
- Nannies: If you hire a nanny to care for your child, the cost can be significantly higher. The cost of a nanny can range from 12€ to 20€ per hour, depending on their experience and qualifications.
- Babysitters: Babysitters are typically less expensive than nannies and can be a good option for occasional childcare. The cost of a babysitter can range from 8€ to 15€ per hour.
It’s important to keep in mind that these estimates are based on averages and that the cost of childcare can vary greatly depending on your specific circumstances, like the age of the child, your location, the city you live in, or whether the child has any specific needs or not. Additionally, some companies offer childcare benefits to their employees, so it’s worth checking with your employer to see if they offer any assistance with childcare costs.
Yes! Expats living in Germany can find affordable healthcare options through the country’s public healthcare system. Germany has a comprehensive public healthcare system that is available to everyone, regardless of nationality or income level.
Under the public healthcare system, you will pay a monthly premium based on your income. The premium is usually split between you and your employer if you are employed in Germany. The amount you pay will depend on your income, but it is typically around 14.6% of your gross salary, with a maximum monthly contribution of around 850€.
In exchange for paying the premium, you will have access to a wide range of healthcare services, including doctor visits, hospital care, and prescription medications. Most services are covered by the state in the public healthcare system, so you will not have to pay out of pocket for most medical expenses.
If you prefer to have additional coverage or want to see a doctor outside of the public healthcare system, you can also purchase private health insurance, which generally has a higher cost than public health insurance costs but can provide additional benefits such as faster access to medical care and coverage for alternative therapies.
Overall, Germany’s public healthcare system is considered to be of high quality and relatively affordable compared to healthcare systems in other countries. As an expat living in Germany, you will most probably be able to find affordable healthcare options that meet your needs.