Cost of Living in Ireland - There’s Good News and Bad

When it comes to the cost of living in the Republic of Ireland it’s very fair to say that there’s good news and there’s bad news – what’s more, the cost of living also depends on where you live with UBS recently ranking Dublin the 8th most expensive city in the world in which to live whilst lesser known villages on the coast can be among some of the cheapest places to live in Europe.

In this article we look at everything from minimum wages, taxes, the cost of city living and health care costs to personal wealth levels in Ireland and house prices so that you can understand how you might be affected by day to day living costs if you do decide to relocate to the Emerald Isle.

It’s very interesting to examine the migration and immigration patterns in Ireland…on the one hand many who are born and bred in Ireland choose to move away from their country of birth for at least a few of their working years to see the world, to learn and experience different work environments, to travel and to earn money.  And on the other hand Ireland is the fifth most popular location in the world with British emigrants who, let’s face it, make up one of the strongest immigration forces in the world!

According to the Institute of Public Policy Research, 290,000 Brits have recently chosen to make a new home in Ireland with the vast majority relocating for better working conditions and a good standard of living.  This is positive news for anyone else thinking of making Ireland home…it’s obviously a welcoming nation and one in which there are work as well as lifestyle benefits for those who do decide to make the move.

The minimum wage in Ireland has risen once already in 2007 and is set to again rise on the 1st of July…at the moment it stands at EUR 8.30 an hour and will rise to EUR 8.65 on the first of July giving anyone thinking of moving to live and work in Ireland an idea of the minimum that they will have to live on. 

Of course tax is due to be deducted from this amount, but according to Deloitte Ireland, Irish workers pay the lowest direct taxes on their annual wages in the whole of Europe.

This is certainly lucky for those living in Dublin because they need every single penny they can get!  As mentioned in the introduction to this article, Dublin was named by global banking giants UBS as the 8th most expensive city out of 71 reviewed in the world.  Unfortunately, if you’re considering moving to Ireland chances are Dublin will be high on your list of locations if you’re seeking employment as it is the employment hub of the nation – so, you’ll have the third highest net wages out of the 71 cities surveyed but you’ll be paying more for housing, food and transport than in many other cities around the globe.

Good news comes in the form of the fact that the public health care system in Ireland is exceptionally good and for those who qualify – which includes all those working in Ireland and paying their National Insurance contributions – it’s free!  So, you won’t necessarily have to fork out for private health insurance on top of your taxes and day to day living costs.  This can be a significant saving because health insurance in Europe is high (not as high as in America, but high!).

So, are the streets of Ireland paved with gold, are you going to become a millionaire if you’re living in Ireland and working there or are living costs actually going to eat away all your personal wealth?  Hmmm, that’s a tough one to answer because it really depends on whether you’re a successful entrepreneur moving to Ireland or you’re actually moving there to retire and put your feet up – but did you know that a survey carried out by the Bank of Ireland Private Banking Division last year showed how house price increases had helped to catapult the Irish to number 2 in the world in terms of their personal wealth levels? 

Of course, this is only applicable to those who already own their own home - and if you’re thinking of moving to Ireland right at the moment you’ll know that house prices are cripplingly high in many areas meaning that for you, personal wealth will actually be hit hard and eroded fast by a house purchase rather than boosted by an instant increase in equity.

A great deal of housing in Dublin is now actually considered unaffordable – it’s official – and because of the popularity of many pretty towns and villages across Ireland with everyone from Irish citizens living overseas to investors and those looking for a holiday home in a beautiful location, the gap between the average cost of buying a house compared to the median amount people get in the bank is widening still.  Property in Ireland is the one thing that you really, seriously need to research and think hard about before making a commitment to move to Ireland because prices and rental costs are not depreciating and you will have to be able to afford somewhere to live on the money you will be earning or living off.

As you can see…in terms of considering the cost of living in Ireland there is plenty to be positive about but there are also a few strong negative factors that can seriously impact wealth.