Swedbank study: cost of living offsets wage growth in the Baltics

A Swedbank study on family living expenses in the Baltic capitals of Estonia, Latvia and Lithuania shows that while net salaries have grown fastest in Vilnius over the past three years, they are still highest in Tallinn at 1 708 euros per month, but families in Riga have the least money left in their pockets after covering their expenses, on Monday, the 29th of April, reports Estonian media ERR.
Swedbank compared household incomes and fixed expenses in the Baltic capitals, focusing on food, utilities and public transport. The analysis covered a family with two children living in a 70 square metre apartment, where both parents earn the average salary in the city.
Although the average net salary has increased significantly in all three capitals since 2021,

the highest increase in net salary was in Vilnius – 42%, followed by Riga – 29% and Tallinn – 24%.

In addition to wages, child benefits were also taken into account. The highest allowance for two children is in Lithuania – 192.5 euros per month, followed by Estonia with 160 euros and Latvia with 100 euros.
Taking these allowances into account, the total net income of the household surveyed in Tallinn was 3 576 euros, in Vilnius 3 126.5 euros and in Riga 2 655 euros, said Mari-Liis Jääger, Head of Swedbank’s Institute of Finance.
The study found that Tallinn has the most expensive food, with a household of four spending 737 euros on food each month, which accounts for 21% of family income. In Riga, food costs 640 euros a month, 24% of family income, and in Vilnius 544 euros, 17% of family income.
“The sharp rise in food prices over the last three years has been felt by the entire population of the Baltic States. As one of the biggest family expenses, the impact on the budget is significant. In addition, food choices are not always optimised, which often results in spending much more on food,” said Jääger.
37% of income in Riga is spent on fixed costs
Families living in Riga have the highest utility costs (not including rent or credit) – 288 euros per month.
In Tallinn, these costs amount to 260 euros, and in Vilnius – 209 euros per month.
Assuming that families in the capital use only public transport to get around, a family living in Riga spends 60 euros a month and in Vilnius 64 euros, while Tallinn residents still use free public transport.
The study highlights that Tallinn residents have the highest monthly expenditure at 997 euros, closely followed by Riga at 988 euros. By contrast, living in Vilnius is the most affordable, with families spending 817 euros a month on these expenses.

After fixed costs, Estonian families are left with 72% of their income, Riga families with 63% and Vilnius families with 74%.

“This year Tallinn replaced Riga as the most expensive capital city, but at the same time families in Riga have the least money left after food, utilities and transport costs,” said Jääger.
Swedbank’s food calculations were based on the lowest prices of similar products in the three most popular online grocery stores.
Data collection took place in all Baltic capitals from March to April 2024, while income data are from 2023.
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