How much can a single, young working person in Tokyo actually save a month?
Of course, the question of how much you can save depends primarily on how much you make and what your main non-discretionary expenses are.
Cost of Living in Tokyo for a Single Person
In a recent survey, SUUMO, a Japanese real estate website, found that the average single person (between the ages of 20 and 39) living by themselves in greater Tokyo had the following average monthly expenses:
- Rent: ¥67,500 (600USD)
- Utilities (gas, water, and electricity): ¥13,000
- Internet and mobile phone expenses: ¥13,000
- Food: ¥32,400
- Total: ¥125,900 (1,119USD)
The reported averages were lower for people in their twenties, but we are only summarizing the overall numbers so we can get a ballpark figure. Your expenses may be a lot different. If so, we’d love to hear from you in the comment section below!
Taxes and Health Insurance
Also, the expenses mentioned above do not consider taxes and health insurance, which are non-discretionary expenses (to say the least!).
Your income tax rate, of course, depends on your income. The example below is for someone who makes a gross salary of ¥250,000 (2,222USD) a month.
With a monthly gross salary of ¥250,000, your take-home pay will be about ¥210,000.
Your employer will make mandatory deductions for social security, unemployment insurance, pension, and health insurance. You will also have to pay income tax.
The second year you are in Japan, you will also have to start paying local inhabitant tax (jyuminzei, 住民税), which will add about ¥13,500 to your tax bill, so your net pay will be about ¥197,000. The approximate deductions are:
- Unemployment insurance: ¥1,000
- Pension: ¥20,415
- Health insurance: ¥12,181
- Income Tax ¥5,270
- ¥250,000 – (¥1,000 + ¥20,415 + ¥12,181 + ¥5,270) = ¥211,134
Now back to how much young people are saving!
How much do single working people save?
The data below is based on a survey of young people living in the greater Tokyo region (including Tokyo and the prefectures of Chiba, Saitama, and Kanagawa) and are tallied from valid responses received from 125 men and 125 women between the ages of 20 and 39 who live by themselves in rental housing.
- People earning less than ¥2,500,000 (22,220USD) a year had the lowest average savings rate (by salary level), but still managed to save about 5% of their gross annual salary.
- People earning between ¥5 million and ¥6 million yen had the highest average savings rate at between 11.8% to 14.0%.
- People earning above ¥7 million a year had a savings rate of about 8.9%.
Average Savings Rates (As a % of Gross Salary) by Annual Income Level For 20 to 39 YO Singles Living in Greater Tokyo
|Annual Salary in JPY||Approximate Annual
Salary in USD
|# of Responses||Average Savings
Per Month in JPY
|Approximate Savings Rate
(as % of Gross Annual Salary)
|2,500,000 to <3,000,000||22,220 to < 26,661||33||26,000||10.4% to 12.5%|
|3,000,000 to <3,500,000||26,661 to < 31,105||39||30,000||10.3% to 12.0%|
|3,500,000 to <4,000,000||31,105 to < 35,548||28||29,000||8.7% to 9.9%|
|4,000,000 to <4,500,000||35,548 to < 39,991||28||36,300||8.7% to 10.9%|
|4,500,000 to <5,000,000||39,991 to < 44,436||21||43,200||10.6% to 11.5%|
|5,000,000 to <6,000,000||44,436 to < 53,323||28||58,200||11.8% to 14.0%|
|6,000,000 to <7,000,000||53,323 to < 62,210||15||61,300||10.7% to 12.3%|
|> 7,000,000||> 62,210||11||52,000||8.90%|
|Source: SUUMO. Survey period: March 9 to 17, 2017.|
How much total savings do people have?
The survey also asked people how much total savings they had accumulated.
For the surveyed group as a whole, 40% answered that they had savings of less than 1 million yen. The next most frequent answer (at 11.2%) was between 1 million and 2 million yen.
Looking at total savings by income level:
- People earning less than 3 million yen a year: The highest % of this group had savings of less than 1 million yen
- People earning between 3 million and less than 3.5 million a year: About 28.2% of this group had savings of less than 1 million yen a year; 25.6% of this group had savings of between 1 million and less than 2 million a year.
- People earning between 5 million and less than 6 million yen: The highest % of this group (28.6%) had savings of between 5 million and less than 6 million yen.
Unsurprisingly, the results suggest that as people earned more money, they were able to add more to their net worth.
What do you think of these survey results? Please comment below.
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Top Photo: Marunouchi, Chiyoda Ward, Tokyo