Uni grads facing a 364% increase in living costs after flying the nest

  • As students return home from university, many are treated to generous cut-rate rent deals from parents, with over half (54%) charging just £132 a month on average, and the rest not charging anything at all

  • However, once flying the nest for good post-university graduates face a staggering £480.51 hike in living costs every month on average – that’s a 364% increase!

  • New interactive tool helps students understand the real costs of adult life, revealing exactly how much their parents COULD be charging, based on local average rent, food, gas and electricity costs.

Thousands of UK students nearing graduation will be heading back home to find some financial respite, with the vast majority of parents treating their kids to cut-rate rent deals. That’s according to the latest research out today from Compare the Market.

Nearly half (46%) of students returning home are enjoying rent-free living whilst staying in their parents’ home, and those who are being charged are getting a more than generous deal, with the remaining 54% of parents charging just £132 per month on average. This is to cover £68 towards their mortgage or rent, £31 towards gas and electricity bills and £33 towards food.

While many students are enjoying somewhat of a financial ‘honeymoon period’ while living at home after university, these young adults would be wise to prepare for higher costs on the horizon when they finally decide to move out.

The research revealed that ex-students will have to fork out £612.51 each month on rent, food, gas and electricity once they have flown the nest for good. That’s an increase in living costs of around 364%. Those moving to Edinburgh will be the hardest hit, having to shell out as much as £891.28 every month, whereas graduates relocating to Leeds will be nearly £5,000 better off over the course of a year on average.

To help prepare students for this increase in living costs and become more money-conscious as they step into a world post-uni, Compare the Market has launched the “Pa-rental Meter” calculator.  The tool reveals average living costs across each postcode in the UK based on local rent, food, gas and electricity prices, providing those living at home with an idea of how much their parents could actually be charging them. Likewise, graduates can use the tool to get to grips with the costs of life as an adult by finding out which towns and areas will suit their budget in terms of living costs, helping them prepare for the likelihood of higher living costs down the line.

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Chris King

Head of Home Insurance

Compare the Market

“Passing final exams may seem like a big enough challenge, however students nearing the end of their time at university will soon have many other big life decisions to make, namely where to live and how they will afford it.  While the thought of moving back home may be a sensible short-term option, it won’t be long until the majority of students will be eager to fly the nest. Time with the parents is a great chance to start saving up for moving out, but it’s also paramount for students to develop responsible financial habits which will help them once they’re in their own place.”

Compare the Market’s top money saving tips for those flying the nest:

  1. Lighten up your home by switching to energy-efficient LED lights: Changing your 40W light bulb to new energy-efficient 8W bulbs could cut your energy usage by around 20 per cent and could save you up to £231 a year!
  2. Eco-charge your shower: Changing the shower head to an eco-version will save you money on water bills and gas bills as you’ll use less energy.  A household of four can save around £74 a year on gas and £120 on water[1] (if they have a meter).
  3. Turning your thermostat down a notch: Turning the heating down by just one degree can cut heating bills by up to £85 a year, enough of a saving to buy an extra blanket and a few meals out![2]
  4. Get on top of your bills...and keep on switching: Whether it’s by listing your outgoings down on a monthly basis or an app, make sure you keep on top of your bills, so you know what’s going out of your bank account and when. It’s also important to make sure you’re shopping around for the best deal, whether it be from your energy provider or your home insurance. Don’t just go with the same provider as your parents and use a comparison site like comparethemarket.com to find the cheapest and best deals for you. And don’t forget to review each year to make sure you’re getting the lowest cost.
  5. Get to grips with council tax: Remember, if you live alone you’re entitled to a 25% discount on your council tax bill. The discounts don’t stop for singletons – if you live with people who are under age 25 and are in approved training or are on a low income, you could also be eligible for a discount![3]
1.    https://www.comparethemarket.com/energy/information/energy-saving-tips/
2.    https://www.which.co.uk/reviews/cutting-your-energy-bills/article/how-to-save-on-your-energy-bill/10-ways-to-save-on-energy-bills
3.    https://www.which.co.uk/money/tax/council-tax/reducing-your-council-tax-bill-atcsu6q474gl