50 years of the price of living - how much of what we earn goes on what we use?

Electricity and gas took more of your salary in 1970

Ever since gas was commercialised way back in the 1700s, home fuels have been something we’ve had to pay for. Back in 1970, the cost of your gas and electricity would have accounted for around 8% of the average UK salary, with slower, less efficient technology meaning more power had to be used to get the desired result. 

In 2020, 7.71% of your salary goes on those bills. The technology is now much more efficient, however we do use a lot more of it to power everything such as laptops, phones and Netflix. 

In 2019, the average Brit spent £1,279 a year on fuelling their home. 

We’re spending more than ever on rent and mortgages

In the 70s, we spent 10% of our salaries on rent and mortgage payments - already a considerable amount to be leaving our bank accounts. By 2019, that amount had increased by half. Brits now spend 15.47% of their salaries to live in their homes, with the average figure hitting £2,615 a year. 

Council tax prices have also gone up. We spend on average £1,274 on that bill now, which is 7.54% of the average wage. In the 70s that figure was as low as 4%, with more of our pay staying in our pockets. 

However, there are savings to be made. By comparing our mortgage offers you can see if you’re paying over the odds, potentially keeping more money in your accounts each month.

The price of entertainment has boomed in the past 50 years

Entertainment, such as TV packages, music and subscription services (Netflix/Prime) set us back on average £534 a year, or around 3.16% of our salaries. This is much more than it would have done 50 years ago, when most of that entertainment didn’t exist. The only comparable price is that of TV licenses, which have actually got more affordable in relation to our wages over time. In 1970, the fee you pay to watch BBC content would have cost 0.78% of your salary, compared to 0.68% now. 

Getting about has become more expensive over time

The price of petrol pumps 4.21% of our salaries out of our accounts, or around £712 a year. That’s almost double what it was in the 70s, when only 2.29% of our wages would go on fuelling our motors. 

The price of the cars themselves has actually become more affordable. Due to the huge range of options there are available, such as leasing deals, pay monthly offers and multiple car comparison sites, we aren’t stuck with the 70s dealers of old and can often find a cheaper car by shopping around. 

50 years ago cars would have cost us 9% of our salaries, compared to only 4.03% (£681) today. 

Fast fashion leads to a steady decrease in price

Fashion has changed a lot since the 70s - not only are flares and hairy chests confined to the past, but clothes are also now much more readily available. Online retailers provide tough competition for high street stores, making it easier than ever to choose a look you like and have it delivered straight to your door. This choice has seen the price of fashion go down. 50 years ago, around 7% of your salary would go on clothes every year. Now it’s only 5.87%, with competition forcing retailers to keep their prices low. 

Things we pay for now that we didn’t pay for then

Technology has come a long way since the 1970s. While the internet had already been invented the decade before, it certainly didn’t look like what we know today, and we certainly didn’t all pay for it. 

The average cost of household internet connections is £363 a year. That’s around 2.15% of our incomes going on keeping us connected. Meanwhile our phone contracts have also changed drastically over the past five decades. A 70s phone might have had a large, round dial on the front for you to dial numbers on, while phones of today are far flatter, lighter and do much more than just make calls. 

That comes with an additional cost. Phone bills of 50 years ago accounted for 1.23% of our salaries, while today it’s more like 2.4%. 

5% of our salary goes on bills each year

The average amount of our salary that goes to utilities providers is 5%, covering everything from TV to water and electricity. So while some things have certainly got more expensive since the 70s, it’s clear the amount of choice we have available now means there are still savings to be made. 

Don’t settle for overpaying. Compare your bills today to see how much better off you could be.

Methodology 

Using data from the ONS basket of goods and services we’ve looked at the costs of certain expenditure in 2020 and back to 1970, and calculated what percentage of expenditure these expenses were of household income in 1970 compared to 2020.