May 18, 2017

How much money can I expect to save in Japan? A break down of the 250,000 yen salary

How much money can I expect to save in Japan? A break down of the 250,000 yen salary photo

To those who want a quick answer to the question, "How much money can I expect to save in Japan?", we say somewhere between 20,000 and 70,000 yen based on a salary of 250,000 yen per month.  However, one can never be definitive about the cost of living in Japan (or anywhere for that matter), although you can always have a stab at an estimation. In our case, things are made a little easier as this is directed at foreigners thinking about, or having already decided upon, moving to Japan. Straight away this means we can largely ignore the fact that the GDP per capita in Japan, by most accounts, is somewhere just over the 4,000,000 yen mark. Just to clarify, that’s a year. So that would be a monthly salary of around 330,000 yen. Maybe this is a bold assumption (and one that we can’t really ‘fact check’), but most foreigners when they arrive in Japan will not be commanding that kind of salary. 250,000 yen per month seems to be more of a common bench mark (generally because this is considered the standard salary for English teachers in Japan).  

Of course there are some costs that care little for what kind of salary we are on, and it’s from these costs that we proceed with our estimate of how much one can expect to save in Japan, or how far one’s salary will go over here.

Japan real estate specialists SUUMO this month published the results of a survey they carried out among young Japanese, living alone, in the Kanto area of Japan. The first part of the survey looked into how much they were spending per month on the following … 

  • Rent (including building management fees and common area fees)
  • Utilities (electricity, gas, water)
  • 通信費用 / tsūshin hiyō / phone (cell/landlines) and Internet, basically
  • Food

The results were as follows (values in Japanese Yen) ...

Average Monthly Rent (including building management fees and common area fees)


Average Monthly Utilities (electricity, gas, water)


Average Monthly Phone / Internet


Average Monthly Expenditure on Food


Respondents of the survey were resident in Tokyo (metropolitan area), Chiba, Saitama, and Kanagawa Prefectures.  

First of all some thoughts on the above

We should tread with some caution here.  In the second part of the survey by SUUMO we learn that respondents' annual income varied considerably, from less that 2,500,000 yen per year to over 7,000,000 yen per year, and unless the respondents in the upper echelons of this range are really frugal such salaries are going to send us off course.  

Rent (~ 65,000 yen)

That said, around 65,000 yen in monthly rent sounds about right for a reasonably nice place in expensive Tokyo, so let's go with that.

Utilities (~ 10,000 yen)

We think 13,000 might be little high and reflecting of some of the higher incomes.  Based on personal experience and that of our peers, within 10,000 yen per month sounds more likely.

Phone / Internet (~ 12,000 yen)

Personally, this expat's cell phone bill is a minimum of 8,000 yen per month, sometimes going up to 12,000 yen.  The Internet package (including landline phone) comes in at around 4,000 yen.  Let's keep things conservative and say that our monthly phone/Internet bill in Japan is around 12,000 yen.

Food (~ 30,000 yen)

This is really hard to keep check of.  Initially, over 30,000 yen sounded high to us, but then we assume this covers everything from eating in, going out for food, snacking, and all the rest of it.  For the lack of being able to add up our own food expenses, let's roll with 30,000 yen a month to cover ALL our expenditure on food in Japan ... except for times like Christmas!  

So, these are the basics of our cost of living in Japan.

NB* - A salary of 250,000 yen per month works out at 3,000,000 yen a year. This puts us in the 10% income tax bracket which ends at 3,300,000 yen per annum. So our monthly income after tax will be 225,000 yen.

Salary (after income tax)225,000
Phone / Internet12,000

Tax and Insurance

Health Insurance (~ 10,000 yen)

When this expat first arrived in Japan (on the above salary, I might add), I was paying for private medical insurance (the employer's choice) that came in at premiums of 10,000 yen a month.  It's a common assumption that these private insurers used when living in Japan as next to useless.  

The Japanese Government wants you on state insurance.  There are two types:

Kokumin Kenko Hoken / National Health Insurance - Usually used for freelancers, the unemployed and those whose employers don't want to get involved in ...

Shakai Hoken / Social Insurance - For those employed by companies who know they should have their staff on it, and ensure that they, indeed, are.  

We don't want to get into the minutia of what these forms of insurance involve and who exactly it is that should be on them at this time.  Right now we just want to concentrate on their costs ... which are difficult to explain ... because we don't really know how they work.  It's based on how much city tax is paid and how many members of a household there are (in this case, one), which in turn is based on income, and then multiplied and divided by seemingly arbitrary figures to come up with an annual premium.  Anyway, on a salary of 250,000 yen a month you're likely looking at a monthly premium of around 10,000 yen.

Pension (~15,000 yen)

Similarly complicated and a similarly grey area as to whether or not many expats in Japan (particularly English teachers) will be paying into it.  If you are, on our base salary, you're looking at around 15,000 yen a month.  Again we're not looking at the details behind this or the rights and wrongs of it, just how much of a dent it will make in our earnings in Japan.

City Tax (~12,000 yen)

Depends on your salary and, to a very limited degree, area of residence.  On our base salary we're looking at around 150,000 yen a year (around 12,000 yen a month).

So, let's adjust our cost of living table

Remaining after tax, rent, utilities, phone, Internet, food108,000
City Tax12,000

So expected savings in Japan from 250,000 yen so far are down to 71,000 yen per month.  That's 640  USD / 573 EUR / 493 GBP.  

Back to the survey carried out by SUUMO.  Their results showed average monthly savings as 31,700 yen.  Again though, this is across a wide salary range.  Those respondents earning between 3,000,000 - 3,600,000 yen per annum were shown to be saving 20,600 yen per month.  

OK, anyway we have 71,000 yen in expendable income left to us per month in Japan.  

What's missing?

One glaring cost of living item is transportation, particularly to / from work.  However, here one might reasonably expect our employers in Japan to cover this, especially if we are full-time, salaried workers.  It's not always thus though.  To give an example of a commuting cost in the Tokyo area we can look at this expat's expenses.

A roughly 30-min commute with around 20 mins of that spent on Tokyo's METRO trains costs 350 yen one way.  However, a commuter pass for one month costs 12,820 yen.  Of course, with this pass I can make similar journeys on those same METRO lines in my own free time and, as much as possible, structure outings for leisure to make the best possible use of that pass and thus save a bit of money.  

And then there are all the other accoutrements that add to the cost of living in Japan and thus effect how much money you can save.  We looked at those daily-life bits and bob that might be surprisingly expensive in an earlier post: What is it that’s so expensive about Japan? 

We don't want to speculate how people feel about these kinds of savings and the cost of living in Japan on 250,000 per month, but to those who might be feeling a little down about it ... 

... your first year in Japan will not incur the same level of city-tax and insurance premiums.  Certainly, in the case of city tax this will based on your previous year's earnings in Japan so doesn't kick in until the second year.  Similarly with insurance premiums in Japan.  Given that these are also based on income over the previous year, for the first year you'll be paying a bare minimum rate. 

However ... 

... there is the initial outlay of expenses for those who have just moved to Japan.  You can read more about that here:  Moving To Japan. How Much Money Do I Need?  To offer a brief summary; if you're arriving in Japan with a job already lined up and ready to start within a few days, it'll be a couple of months before that pay cheque comes in.  We estimated that if you were happy to stay in share houses for the first few months then around 200,000 - 300,000 yen would be enough to get a roof over your head and keep you fed and happy until payday.  Those looking to get an apartment sorted (on their own money) as soon as possible might need around 550,000 yen to get set up and keep going until the pay cheque arrives.  These estimates were based on living in Tokyo, typically the most expensive place to live in Japan.  

Ultimately though, once things get settled and you fall into the rhythms of life in Japan, a salary of 250,000 yen a month will could well leave you with 70,000 yen of expendable income out of which locals in the 20s and 30s in the Kanto area are saving around 20,000 yen (180 USD / 162 EUR / 140 GBP).  

We can't leave this here though, without addressing the issue of rent.  While 65,000 yen per month in rent is reasonable to expect, it is far from a must.  There are cheaper apartments to be had (maybe as low as 30,000 yen) as well as the option of share houses.  It should also be noted that the Kanto area is one of the more expensive places to live in Japan.  

It's probably far to say though, that if you're saving some 70,000 yen a month in Japan on our base salary, you're doing very well.  20,000 yen sounds a maybe little low to us, but might be expected for the more excessive months.  

Does all this sound reasonable to you?  How much money do you think people can save in Japan on this kind of salary?  Let us know in the comments.

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Twitter: @City_Cost_Japan

Facebook: @citycostjapan


Source(s):  SUUMO ジャーナル


Hajime Nagahata Flickr License



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  • helloalissa

    on May 20

    I think the estimation of monthly salary for someone just starting out as an English teacher in Japan is around (or at least?) 30,000 too high, if you'll check current job listings and the salary range. (Unless said person is a JET.) Not to mention ALTs are usually only paid for around ten months of the year as there is no work during school holidays. This is another topic altogether. My first year (teaching English) in Japan (2012 school year), my monthly salary was 220,000 I think including the stipend for transportation. My (Leopalace) rent was around 50,000 including utilities if I remember correctly, in a small town in Kanto. I managed to save a little over 1,000,000 in one year, while being quite frugal and usually cooking at home. I rode a bike to work. There was a bit of (in country) travel expense during holidays. Coworkers were impressed by that amount of savings. Somehow I think the amount Japanese people can usually save is far off from what foreigners save. Allowing for any entertainment, clothing, expected high priced work parties, education, paying bills back home, etc. would be more realistic, but this all depends on the person.

  • Ram

    on May 26

    Wonderful analysis. It would be great if you could do a similar analysis for people moving in with a family say a family of 4 including 2 school going kids!!

  • SalarymanJim

    on Jul 24

    Mmmm. I agree with previous comments that the 250,000 yen salary is high. Maybe a few years ago 250,000 yen was the industry standard (in Tokyo anyway) but nowadays you're seeing these English teacher salaries closer to 200,000 yen than 250,000 yen (again, in Tokyo). But 70,000 yen of savings a month would have sounded doable on 250,000 yen. I think it would require plenty of discipline. I think one of key factors for saving money in Japan is to try and be aware of the 'yen' as real money. To understand its value rather than seeing it as a kind of Monopoly money. I think this kind of thinking can help prevent wasting money of small things that you don't really need (snacks, vending machine drinks and things like this).