Q How much does it cost to live in Tokyo?

Hi I’m Yoshiko Nakamura, Bilingual Financial Planner in Tokyo. I am here to answer your questions about Money.

How much do you think it costs to live in Tokyo? The answer is easy. “It varies.” But I know this won’t satisfy you.

I will give you a statistic answer. It will cost about 4 to 5 times of your rent. How about that?

 If you are planning to pay for or have found an apartment, where monthly rent is 100,000 yen, your total living cost will be from 400,000 to 500,000 yen a month. So you have to make at least 4,800,000 yen as your net income. Net income means after tax and social benefit premiums.

This rule applies for a single person, for a couple, and a family with children.

If you’d like to estimate the amount of money you have to make, I suggest you to look for some apartments you’d like to live in. Then you will know how much you need to earn to make living in Tokyo.

One more point. If you want to have a car in Tokyo, you have to add the cost of the car to this amount because it is quite expensive to keep a car here. Do you have any idea how much it costs to own a car in Tokyo? To get the answer, please go to next Question, which is coming soon..

As some of you can guess, this rule works the opposite way. It means you’d better control the rent under 25 % of your net income. If your income is 4,000,000 yen, the rent should be below 1,000,000 yen per year, under 84,000 yen per month. As long as you keep this limit, you can get married, buy a house or condominium, raise two or three children, and prepare for your retirement with good financial planning advice. Of course the lower the rent is, the more enjoyable life you could afford, like trips, concerts, Kabuki, skiing, scuba diving, etc.. So it’s worth trying hard and taking enough time to find a good place at reasonable price.

Be careful not to chose too expensive property, it would make your everyday life miserable and/or make it challenging to prepare for your future.

Need a little help? Here I am. Please contact me anytime.