Cost of living in Luxembourg

Few words of introduction…

Salary

While examining the real cost of living, one also has to look at the salaries, which can differ significantly from one country to another. According to the latest data from the Luxembourgish Government (April 2022) the minimum gross monthly salary for a skilled, adult worker is 2,776.05 EUR. Meanwhile, the average gross salary per year is around 59,000 EUR with the highest salaries in the banking sector (according to the CareerExplorer article from April 2022).

An important point to add is also that in Luxembourg, by law, salaries are adjusted in correspondence with the evolution of the cost of living – which is when the consumer price index increases or decreases.

Accommodation

It can be challenging to find accommodation in Luxembourg and if so, it might be pricey. The price will most importantly depend on the type of accommodation and the location.

For a one person bedroom in a Coliving housing, one will pay between 800 and 1250 euro per month including all utility cost (prices indicative at the moment this article was written – December 2022). A studio, however, tends to cost approximately 1600 euros.

Considering the above options, for a single, young professional a Coliving arrangement will probably fit their needs the most and is probably the smartest choice. A couple, however, might decide for a studio that tends to offer more ‘creature’ comforts. A family with a child though will have to pay at least 2200 euros for a two bedroom apartment.

Food

Food prices are slightly higher than in the neighbouring countries which also might vary depending on the brand. Luxembourgish grocery stores, like Cactus for instance, tend to be usually a little more expensive than international ones like Delhaize or Auchan and Lidl.

Eating out is rather pricey and a customer will quickly see the difference on the bill. A meal (food + drink, no starters) in an average restaurant will cost about 30 euros. A mid-range one, on the other hand, will charge closer to 40 euros per person.

Transportation

At the beginning of 2020, Luxembourg became the only country in the world that offers free public transport to everyone. That could save up to a few hundred euros per month, if we speak about a family with kids.

For those who care more about ecology, Luxembourg offers “veloh” – electric bike system for 18 euros for an annual subscription plan.

Important to say is that the prices for fuel are cheaper than in other countries thanks to lower taxes. The difference can sometimes be as high as 0.20 euros per liter.

Luxembourg’s central location in Europe and a well developed communication network – connections with DB in Germany and TGV in France as well as an International Airport 20 minutes from the City and several International Airports within a few hours drive – are a big advantage for those who like to travel.

Health Insurance

Generally speaking, almost all healthcare is covered by public Health Insurance: medical, dental or hospital care as well as medications (nearly all with a few exceptions). The insured person pays the invoice upfront and the National Health Fund reimburses it afterwards. Additionally, some employers offer additional Health Insurance that covers the non-reimbursable costs as well.

To summarize… 

At first glance, Luxembourg might seem one of the most expensive cities to live in. However, upon closer study, the country offers higher salaries than its neighbours as well as several advantages available to everyone:

• free public transport 
• salary indexation
• public health insurance
• lower fuel prices
• central localisation in Europe