Living, working and budgeting on the UK National Minimum Wage

Parenting on a budget

What is the Minimum Wage?

The National Minimum Wage is the minimum pay per hour most UK workers are entitled to by law. How much you’re paid depends on your age, and whether you’re an apprentice or not.

Most UK workers who are 25 or older must be paid the National Living Wage – this is the highest rate of the National Minimum Wage.

Here are the National Minimum Wage and National Living Wage rates for 2018:

  • If you’re 25 or over: £7.83 an hour
  • If you’re 21 – 24: £7.38 an hour
  • If you’re 18-20: £5.90 an hour
  • If you’re under 18: £4.20 an hour
  • If you’re an apprentice: £3.70 an hour

From April 2019, these will change to:

  • If you’re 25 or over: £8.21 an hour
  • If you’re 21 – 24: £7.70 an hour
  • If you’re 18-20: £6.15 an hour
  • If you’re under 18: £4.35 an hour
  • If you’re an apprentice: £3.90 an hour

What is the Living Wage?

This is a standard of living set by the Living Wage Foundation. To allow for the extra cost of living in London, there is a UK rate and a London rate.

In London, the Living Wage is £10.55 an hour. Across the rest of the UK, it’s £8.75 an hour.

The Living Wage is based on the cost of living – and what people need in order to be comfortable, and have enough money to live well. The Resolution Foundation – a think tank which exists to improve the lives of families which don’t earn much money – is overseen by the Living Wage Foundation.

Am I entitled to the National Minimum Wage?

You will be paid the National Minimum Wage if you are at least school leaving age.

Almost all UK workers have the legal right to be paid the Minimum Wage, including casual workers, part time workers and temporary workers. However, if you’re self-employed – or a company director – you’re not entitled to it.

If you’re not sure, you can check who gets the Minimum Wage and whether you’re entitled to it.

Living well on the Minimum Wage

Renting and accommodation

  • If you’re worried about your housing situation or worried you might lose your home, you can apply for emergency housing from your council
  • Rent with friends – the more people who share the property, the cheaper it will be
  • Move back in with family members or ask a friend if you can live with them
  • Sites such as will list rooms in your local area – look for all-inclusive rental contracts so you can budget effectively, and avoid extra bill payments

Accommodation provided by an employer can be taken into account when calculating the National Minimum Wage or National Living Wage.

Travel costs

  • If possible, book train and coach tickets in advance, and sign up on travel operator’s websites to take advantage of Early Bird deals
  • Buy a monthly or weekly travelcard if it works out cheaper than buying daily rail tickets
  • Invest in a Network Railcard or 16-25 Railcard to cut travel costs by up to a third.
  • If you’re taking a long journey, there are websites which will ‘split’ your journey up to see if you can buy a cheaper ticket to the same destination
  • Take coaches or car share rather than taking the train
  • If you have a car, work out the monthly cost of running it – including fuel, breakdown cover, insurance and maintenance costs. If it’s cheaper to use public transport, you could consider giving up your car

Food and entertainment

  • Shop at cheaper supermarkets or local markets
  • Plan your meals so you can avoid buying extra food when you’re out and about
  • Eat at home as much as you can, and make packed lunches for work
  • If you want to eat out, check out online deals and vouchers
  • Cancel expensive TV subscriptions and look into pay-per-view TV and film services
  • If you’re cutting back on going out, you could host evenings at home for you and your friends, from dinner parties to movie nights

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