Berlin may be Germany’s capital, but it’s very much a world city, having bounced back confidently from 20th-century occupation and division to become one of Europe’s most exciting destinations. Berlin is home to a multicultural population that these days barely spares a thought for the Cold War and the wall that divided the city for almost three decades.
So you want to move to Berlin. How much do you have to make in Berlin to afford a decent living? What do you need to spend on the essentials, like rent and food and utilities? Most of all, can you make your budget work in Berlin?
Berlin has an overall cost of living index which equates it with high cost of living locations. The overall cost of living index is comprised of the prices for defined quantities of the same goods and services across all 13 Basket Groups. Berlin is currently ranked 69 overall, most expensive place in the world for expatriates to live, out of 300 international locations such as Moscow, Zurich, Paris.
Living costs depend on your personal requirements and habits. So let’s figure out the average monthly cost of living basket for your Erasmus in Berlin:
Renting an apartment, flat or a house in Berlin
Finding a place to live is a priority when settling in Berlin. It’s quite easy thesedays to find an erasmus apartment for rent in Berlin.
Rent is reasonably cheap in Berlin compared to other European capitals. A studio or one-bedroom apartment in a decent area costs around $500 a month in rent. A two-bedroom apartment, newly modernized with big rooms, in central Berlin will set you back around $830 to $1,000 a month.
You can find rent using rental agencies , classifieds or just look for accommodation in local newspapers (which are usually in German) like the “Berliner Morgenpost” .
Most rental agencies ask for two to three months’ deposit.
The city’s rates are much cheaper in comparison to other key cities such as Frankfurt and Munich. In fact, rent rates in the capital have had one of the steepest rises in recent years, along with those in Baden-Württemberg, Bavaria and Hesse. The farther the property from the city center, the cheaper the rates.
Food prince in Berlin
You can count :
$1.38 for a litre of milk.
$4 for 2 litres of Coca Cola.
$4.93 for one pound of ground meat.
$6 for a whole chicken.
$2.50 for a loaf of bread.
$2.49 for 1lb of white rice.
$1.23 for a box of cereal.
$0.42 for a bottle of mineral water.
The price of home-cooked food and restaurants can vary greatly in Berlin. A meal in a midrange diner can cost EURO 8 – 16 while a three-course meal with a bottle of house wine in an upscale restaurant can go up to EURO 70. A week’s worth of groceries per person costs about 15-35 Euros, but some people have taken well to those quick meals of shawarma (Turkish chicken meal) and sausages in stands.
Costs for general healthcare, medical and medical insurance such as general practitioner consultation rates, hospital private ward daily rate, non-prescription medicine, and private medical insurance / medical aid contributions is equally expensive on average compared to other cities.
At present, the monthly fee is 58,49 EUR at all German governmental health insurance companies which is less expensive than private health insurance.
Public Transportation in Berlin
Berlin is a lot cheaper than Frankfurt and Munich in terms of getting around the city. An exception though is train travel. But by bus, tram or metro transit, about ten stops within a 10 kilometer-trip can cost less than 2.20 fare. A five-kilometer taxi trip within the city can be as cheap as 9.41 Euros.
It is most common to travel on the German Railways (“Deutsche Bahn”). In towns and cities, suburban trains, buses, trams, the underground, and taxis are the usual means of transportation.
The utility costs for a household for two to three people is 200 Euros monthly on electricity, gas, water and garbage fees. A hundred-minute call on a mobile phone can cost about 15 Euros while a 2mbps ADSL flat Internet connection will be billed about 30 Euros monthly. You can count $41 (€30) for a low-cost cell phone monthly and $4.10 (€3) for 30 minutes in an Internet café.
The euro has been Germany’s official currency since 2002. Euros come in seven notes (five, 10, 20, 50, 100, 200 and 500 euros) and eight coins (one- and two-euro coins and one-, two-, five-, 10-, 20- and 50-cent coins). Cash is still king in Germany, so you can’t really avoid having at least some notes and coins, say €100 or so, on you at all times. At the time of writing, the euro was a strong and stable currency, although some minor fluctuations are common.
Anyone who is working in Berlin should be registered with their local Tax Office , which is the equivalent of the Inland Revenue. Each suburb has its own Tax Office, and you register in the suburb of your residence, or if you have your own business, then the suburb where it is situated.
You will be issued with a tax number which you will need to declare when claiming payment. Although some people get by without being registered, the chances are that you will be caught eventually if you are not solely engaged on the black market! Everyone, whether employed by a company or a freelancer, has to file a tax return. The main difference between freelancers and employees however is that freelancers declare what they have earned in order to determine what they have to pay, and employees are entitled to a tax rebate for any overtaxation that may have occurred throughout the year. Theoretically you can claim for any work-related expenses, so remember to save all relevant receipts. Many factors affect your tax calculation -for example marital status and children. The initial income tax rate for households is to be cut from a current 25.9% to 19.9% in 2002.
Most German goods and services include a value-added tax (VAT), called Mehrwertsteuer (or MwSt), and currently set at 16%. If your permanent residence is outside the EU, you can have up to 12.7% refunded if you take goods home with you within three months of purchase. The only hitch is that this scheme is only good for items bought at stores displaying the ‘tax free shopping’ sign.
At the time of purchase (€25 minimum), you must request a global refund cheque from the sales staff. When you get to the airport, show your unused goods, receipts and passport to customs officials before checking in for your flight (with the exception of Frankfurt, where you check in yourself but not your luggage, then go to customs, then check in your luggage). The customs official will stamp your global refund cheques, which you can then take straight to the cash refund office and walk away with a wad of money. Alternatively, you can mail your cheques to the address provided in the envelope for a refund via credit card or bank cheque.
If you think you can afford all this, then go for it, Berlin is the place to be!