Today I want to illuminate what life is really like for the average Chinese person that has yet to fully reap the rewards of China’s rapid development. We’ll be looking at a friend’s monthly budget up close, which I think you’ll find quite interesting. From other discussions with students, this seems to be a fairly typical budget.
She is about 20 years old, and is in her final semester of college (a three year program). Her school requires her to complete an internship as part of her degree, the hospital gives her practically no work to do and she takes home no salary. All in all it seems to be a huge waste of time and money for her, but for some reason it is necessary for her degree.
She comes from a village outside of the city, so she rents a room in a family’s apartment nearby for 500rmb per month. This allows her to walk to work, which saves her the 1.6rmb bus ride (transportation costs her roughly 40rmb per month). She feels guilty about every penny she spends, knowing that her parents are working hard to pay for her existence here.
She eats 2 baozi for breakfast, a lousy meal in the hospital dining hall for lunch, and cold noodles with a piece of fruit for dinner. This costs her about 20rmb per day. She says she wishes she could cut back her spending on food, but worries about her health if she started skipping meals. I worry about her health as it stands. She told me that her father spends just 1rmb for lunch, I worry even more about his health.
Her time in the office is usually spent studying for upcoming tests. She will try to pass 7 of them this year, which would qualify her for a slightly better degree. For this chance she will spend about 500rmb on materials and testing fees.
She told me that she misses her friends and family dearly, which is obvious from the amount of time she spends texting each day. Her mobile phone bill is about 65rmb per month, but she says this is one convenience she couldn’t survive without.
Her “other” expenses though were an area that proved to be the most costly, nearly 620rmb each month. While some of that includes everyday things, many of these expenses were the result of Chinese culture, and proved to be the most interesting.
For example, last week three of her classmates came to visit her (they live just south of the city). For some reason she is considered to be the one with the job while they are mere students. In reality none of them can afford to go out to dinner, but tradition demands that our intern host a meal, which set her back 150rmb, more than she usually spends on a week of eating.
She also helps her brother to maintain his long-distance relationship, which I found to be very surprising. Each week she goes to the market and buys 15rmb of fruit to give as a gift. While it may seem like a small gesture, to this young woman, it feels like a large burden that she gladly carries. Mid-Autumn Festival also included a 20rmb gift of fruit to her boss’s mother.
Finally, she is preparing for her brother to visit in the next few weeks, which means that she will be paying for his ticket from Shenyang (way up north), and letting him stay in her single rented room. The cost of this visit will probably force her to choose between eating and admitting to her parents that she has already spent the money they gave her.
The budget of an unpaid intern
For her, living simply in Nanjing costs her parents roughly 1800rmb per month (In Western China farmers make ~2,000rmb per capita per year). She says optimally her budget would be less than 1500rmb per month, something most Americans would find to be an impossible task, yet tens of millions of Chinese are trying to do just that.
Good post. Shared it on https://www.facebook.com/EasyinChina. Maybe next time you can integrate a nice picture too. Then it is much nicer to share your posts on social networks! Just a tip…
It is almost impossible for a normal Chinese working class to live a decent life, if you also consider the super high house price. They are like the slaves of the country. China leaders are playing politics abroad by considering buying national debt from EU countries to save their economy, meanwhile letting their people at home suffering from the “good” time.
Yeah. China showcases slavery driven economy is not at its end. Quite the contrary, when everyone else is playing the game in a civilized fashion, a back-stabbing, ear-biting, nut-kicking barbarian rapes them competitors by f-ing insane advantage. Red China FTW!
When you say “decent”, whose value of “decent” are you referring to?
Kudos to this great post and the real China it pictures! Foreigners need to look past the shiny skyscrapers and the building “wealth” and the seemingly large legion of billionaires. Come face it: China is commonly recognized as a developing country, and the money it has is limited (considering the economy size). If that much money, as every foreigner has been beholding and talking about, have already gone to the state government and to all those billionaires, what’s left for the shockingly huge population? And average that to per capita?
Are they spending money they have or (like in the U.S.) relying on 6-figure student loans that keep them in poverty for 20 years?
I wish she didn’t have to live so modestly, but she sounds more responsible than American students who treat college like a party and a vacation.
Or American students can do like I did, work your butt off in high school while getting good grades, graduate with a double major in 3 years, and finish college without a penny of debt.
I think it’s a bit presumptuous to assume that all American college students have the opportunity that you did. I consider myself extremely fortunate that I was able to graduate without much in loans, but I know people who worked just as hard as I did who had to take out loans.
Not saying that it is a possibility for everyone, but it’s also not impossible to make it through college without loans, especially 6 figured ones mentioned in the post above.
For undergraduate debt, maybe. Anything above that needs a family with money or debt. Plenty of college students work their butts off and still wind up with debt, but the six figures debt doesn’t usually come until post-graduate work.
Fresh off Weibo:
Cui Yongyuan (崔永元）: If you have a monthly income of 10,000 yuan, you have to pay 14% income tax, 12% public accumulation fund, 8% retirement insurance, 4% medical and unemployment insurance. Together, 3800 yuan are gone, and you have 6200 yuan left. If you spend all the 6200 yuan left, you will have to pay 17% value-added tax and 28% other miscellaneous taxes, and that is another 2800 yuan. So, if you have earn 10,000 yuan a month, you will have to take out 6600 yuan to “feed dogs.” And you have no right to ask question. Nothing is public, and it’s all TMD confidential.
I’m an American expat in China, and I’ve done just as this young lady has..and some months spent much less mainly because to survive it must be done. Also, you could inform your young friend she could easily get by on 1000 to 1100RMB in Nanjing ( trust me I’ve done it.). For one thing 500RMB for a room in Nanjing is too much, when she can move into an “ant colony” and get a bed for between 250-350RMB, all inclusive and free wifi.
I’ve long contended that China is in fact an expensive place to live and work, but nearly everybody thinks I’m loopy on this matter. So I’ll give you a (kind of) Hong Kong perspective.
Like Yaxue C. said, a person forks out a plethora of taxes for daily living in China. People concentrate on the fact that prices are pretty low there (objective truth), but I find many often forget that earnings are pretty low too. Earning power in China doesn’t match up with spending requirements. Increasingly, diets are being ‘gentrified’ or ‘modernised’ (with not a little help from the authorities and advertising) and that requires more money. Infrastructure is continually being upgraded, and that also costs end users more money. All the mod-cons that people increasingly expect all cost cold, hard cash. But income levels have stayed put for years, broadly speaking. With so many different kinds of taxes and outgoings eating away at the income, everybody is living hand to mouth. If a person finds himself/herself in slavish employment, he/she is locked into it because of the expenditure pressures of having to live in an income-generating locale and the opportunity-less situation of the home town/village courtesy of the authorities.
In Hong Kong, living standards are bloody expensive. Yet our earnings are at much higher orders of magnitude compared with China’s. Our rents and mortgages are outrageously expensive, but salaried people pay a sort of flat 15% income tax (no worldwide tax like the USA or UK have) and 17% for corporate earnings. We have no sales tax (VAT, GST), no muncipal/city taxes, no ‘federal’ taxes, no national insurance (social security) pay-ins, but only an MPF (Mandatory Provident Fund, a kind of retirement pension fund) with employers and employees both contributing. But it is the much higher earning power that makes the whole business of living in Hong Kong bearable.
Yes, I’m giving a somewhat idealised picture of Hong Kong vs. China. But a multiple-degree person in Hong Kong will have more opportunities to make good, whereas the same multi-degree holder in China will be stuck in a dog-eat-dog world with far fewer breakout opportunities (mainly because the person will be fighting against 500 million or whatever other multi-degree graduates).
I’ve got a friend (a Hongkonger) who now lives in Shenzhen because of (shall we say) reduced circumstances. The friend thinks living in Shenzhen is the only doable, cheaper option available, which seems true enough (on the expenditure side of things). But the friend is now far, far poorer than when living in Hong Kong, mainly because friend is unable to earn enough (even in Shenzhen!). I’ve made some calculations (yes, I’m THAT insane) – basically, adjusting/equalising expenditures to constant, my friend’s income has actually reduced by 100+%. In other words, while the friend’s expenditure is lower in China than in Hong Kong, income has gone way way down even more than our intuition might suggest. Similar patterns of income reduction in my other calculations. That’s why I said China is actually an expensive country.
Just my (long) twopence worth. I hope all the stuff I said up there makes sense, no?
I just wanted to add that I actually agree with all the other commenters here, and my last comment in no way suggests otherwise.
Someone thinks this story is fantastic…
This story was submitted to Hao Hao Report – a collection of China’s best stories and blog posts. If you like this story, be sure to go vote for it….
Seems like a typical college student. Hardly a typical Chinese. Most Chinese skip college and immediately start working after high school (if not before high school finishes).
You are saying this is a task most Americans would find impossible to do, but this girl herself is not even capable of doing… so what’s the logic in that statement? This was an interesting article but I feel it’s made to be seem more dramatic than it really is. There are plenty of college students in America who graduate with tons of debt before they even find a job. If she really was struggling that badly, she wouldn’t be spending a third of her budget on entertainment/others, not to mention that cell phone bill… and there are plenty of rags to riches stories and plenty of millionaires in China, they just have to think outside the box instead of choosing to be a “slave”, same thing goes for people in America…
obviously she can make cuts. The point of the story is simply looking at how Chinese in their 20’s prioritize their budgets. The fact that she spends so much on her cell phone and entertaining guests helps understand Chinese culture.
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strange expenses, 20RMB for lousy meal? I’m usually eating 2 warm dishes per day in Beijing, each cost around 8-9RMB, so I usually spent 16RMB for necessary and good meals and during nice sunny day 1-1.5RMB for icecream, sometimes 3RMB in morning for jianbing, so altogether around 20RMB per day for 2 nice meals with icecream with warm breakfast, nothing lousy
bus ride in beijing usually cost 0.4RMB per ride, so it’s 0.8RMB per day times 22 gives 17.6RMB, cheaper than 40RMB mentioned in article, I’m living in walking distance from work so I don’t need to spent money at all, anyway I could buy bicycle as investment instead of paying for bus/subway
the cheap rooms are in Beijing available for 600-800RMB, nice room in nice apartment in my living area is 1100RMB, while me as foreigner have room for 1500RMB (very expensive by chinese merits)
someone above is mentioning some BS about earning 10000RMB and getting 6200RMB, so I don’t know in what country is it, but me and all of my foreign colleagues are paying only around 5% income tax from similar salaries without any other expenses, so with 10000RMB you would end up on 9345RMB, something we can dream about in commie leftist EU with forced healthcare, unemployment insurance and retirement plans
I can entertrain myself on streets, free parks and museums meeting with people without paying or in worst case on internet with movies, games and QQ, no need to spent almost any money on entertainment
if I wanted really save money I would move to cheaper room for let’s say 700RMB which is not problem to find in Beijing (check 58.com without real estate agents commission) and I can fed up myself for 20×30=600RMB very easily with decent meals without any starving and saving, so without some sudden expenses (shower gel, washing powder, tooth brush/paste) it’s not problem to get to 1300RMB, if I would be chinese eating lousier meals, staying in lousier rooms (you can always share or get small cell) and saving money I could go for sure to 1000-1100RMB in Beijing, in smaller places must be budget much lower than menioned in article
The BS you referred to was a Weibo item of Cui Yongyuan, a well-known CCTV host. I don”t think he is shooting off BS left and right. You have to keep in mind that foreigners probably only pay a nominal amount of tax and since they are not participating members of the social system, they don’t pay into things like accumulation fund or various insurances and a host of fees that apply to only Chinese citizens. Also, the point Mr. Cui was trying make is the lack of transparancy on tax matters.
A few of us seems to have missed Tom’s point here, I reckon. The devil is in the details. We could recount any number of ways about how each and every one of us spend this-or-that amount on such-and-such activity till the cows come home. Tom’s post is trying to show us the weightings of incoming and outgoings of a modern twentysomething in a modern city in China, so that we may hopefully infer the reasons underpinning those expenses. Have I got that right, Tom?
She is a STUDENT not a “working class” or an “average Chinese person”. An intern at that. Her actual skills would qualify her to pass tests, at best.
“Today I want to illuminate what life is really like for the average Chinese person that has yet to fully reap the rewards of China’s rapid development.
She is about 20 years old, and is in her final semester of college (a three year program). ”
Oh Please.
I’m not saying that many Chinese in China are not in poverty and having a hell of a low quality of life, what I’m saying is that the article is .. umm better not say it…
Her expenses per month are actually quite high, for an intern in nanjing. “She says optimally her budget would be less than 1500rmb per month, something most Americans would find to be an impossible task” what a meaningless comparison. While you’re at it, compare the actual cost of living and what you get for the money. I was a student an intern in the west if a wealthy country and had to go buy bus an hour each way, live with room maters, work part time and study at nights. Many of my friends were like it. In all honesty one of the reasons was that I was skill-less. This girl is probably skill-less and like most graduates would still lack any skills other than how to pass a test. This is one of the main reasons she will have very low salary. Once she has some experience it can go up.
I can go on and on with this. but.
I hope you took the time to read the two articles linked at the end of the post that detail average earnings of migrant workers and farmers in China. When you include all of the information you can get a clearer picture.
Also, I didn’t say American’s living in the US, I mean an American living in Nanjing would find it difficult to live on 1500 a month if they had to pay for rent. I’ve heard several expats here complain that 8,000rmb/month isn’t anywhere near enough to survive on.
well, Nanjing must be really expensive megacity compared to village called Beijing where I live now, where you can find room for 800RMB, decent meals for 7-9RMB (who needs more than two warm meals per day?), buses cost 0.4RMB/trip etc. etc., I can do it in Beijing under 1500RMB (my monthly budget is about 2500, because of more expensive room and not really saving that much), not even in s*thole like Nanjing
you can always find these types complaining they can’t survive on 8000RMB/month everywhere, while in 3 minutes you will find people who can do it in one quarter of their budget, but everyone thinks about needs in different way, for someone is needed for survival to have each day pack of cigarettes and at least 5 beers and walking 2-3 kilometres after bsues/subway stop operating is not option, they have to go by taxi etc. etc.
for 1500RMB I don’t have problem to live in Bangkok, KL and practically in any capitol of SEA, it depends on your standard of living
yesterday I was chatting with my chinese friend living in Changsha in own small room with window and internet which costs her 190RMB/month 5minutes from university, so much for expenses in smaller cities and BS numbers in article
it would be just easier to admit that you are calculating expenses according to expenses of some stupid girl who don’t know how to save money and spend them wisely
so let’s assume:
800rmb/month for room
540rmb (9rmbx2per dayx30days) for skimpy meals
24 (.4rmbx2x30 ) to get to work
=1368
to meet the 1500rmb budget, you would have a total of 132rmb to cover daily goods, cell phone, clothing, and the occasional meal out with friends, and that’s with only eating 2 meals per day. Are there people who do this? Of course there are. Can we say that these people are really reaping the rewards of China’s modernization? Well, the life described, sure doesn’t sound like it to me. May I point out that you don’t live on this kind of budget for precisely the same reasons that the girl in the article doesn’t, it’s not much fun.
I never claimed in this post that all of her choices maximized her savings, or that this was the absolute minimum expenses.
so what is actually point of article? my chinese friends are earning of course more so they don’t have problem to afford better accommodation, better meals, one of them is SW engineer earning about 10000RMB, another one is just student who came here for temporary job earning 3000RMB, one of my colleagues had part time job in university as clothes shop seller for 3000RMB or as tour guide earning 300RMB/day, one of my other friends didn’t have problem to find job as clothes shop seller for 2000RMB (nothing stressful and difficult to do with necessary qualification), so I don’t know what is actually article trying to prove. I consider many of my chinese friends I met clever, but not particularly successful people, neither they do, it can be always much better
if you choose wrong major, career and undeveloped town, then of course you have to save money on everything and it’s not nice life, but you shouldn’t complain because it’s your fault, because there are smarter people who did wiser choice and they have better life even without rich parents
Nice breakdown Tom, thanks for sharing. It’s strange the back and forth on this. I think anybody would struggle to make ends meet in Shenzhen on that kind of budget, though I know Nanjing is cheaper than here.
My cost of living is considerably higher than this young lady’s and I’m not living the high life here, so much as an ordinary one. I don’t find the cost of living much (if any) lower in China than in the UK, though cigarettes and cheap take away food are the exception.
I’m absolutely convinced that most Westerners wouldn’t be able to hack it in China on less than 1,500 kwai a month.
Nick, my office people (who are Hong Kong Chinese) say they also couldn’t hack it on anything less than 1,500 yuan a month – even as Chinese.
The girls in my office – who are Chinese, Chinese would be appalled at living on less than that money too. Not that we’d ask them to thankfully.
I realize the girl is in intern, but for all the commentators who chime in that her salary would be much higher once she has “skills,” let’s settle down a bit and look at reality. I don’t know the numbers in Nanjing; I am in Guangzhou which is presumably more expensive. Minimum wage in Guangzhou is 1300 RMB and average monthly salary in Guangzhou in 2010 was 2161 RMB for university graduates. Able-bodied migrant workers can walk into hundreds of factories in the Pearl River Delta and start at 2000-2500 RMB with dorm housing and subsidized (or free) meals, if not substantially more than that if they have qualifying experience. That is a fine wage for unskilled labor but it’s certainly not the lap of luxury, and anyone making less than 2000 RMB a month in a decent-sized city will basically have no money to save and will be living month-to-month.
Chinese wages are abysmally low compared to the costs of living, particularly housing. In 2009, the Financial Times reported that “the house-price-to-income ratio in most Chinese cities has been well above eight for years, and reaches an eye-watering 14 in the priciest cities.” It’s nice for all the “expats” (i.e.: students) writing here to chime in with how they can live for X RMB per month, but for actual adults with families, these kinds of wages are absurd. Sure, it’s possible to survive on a subsistence wage for an extended period of time, but some people may actually want to save money in the hopes of having funds to cover education, catastrophic illness, home ownership, travel to see family, etc., not to mention maybe getting to a point where they can stop working sometime before death. People may even want to buy a DVD or have a decent meal every once in awhile–imagine the novelty! Keep in mind that the high taxes in China provide very little in terms of a reliable social safety net, especially for poor people and migrants. The fact of the matter is that China’s development has benefited millions and millions of people, most notably the poorest people in the country and those who managed to start successful businesses. But starting in the 2000s, wage stagnation and rising prices have hit college graduates and middle class workers (middle class being defined in terms of a bell curve, not in terms of lifestyle) very hard. Yesterday’s wages are simply not sufficient in today’s China.
Very interesting Post. I have enjoyed reading the comments very much. More informative and thought provoking Posts like this, please!!!!!
[…] office’s chipper intern (the same one whose budget we looked at last week) surprised me on the way to lunch today when she told me she was in a bad mood instead […]
I have to agree with some of the above comments, there is absolutely no way as a foreigner I could survive on 1500 RMB a month, and I doubt most Chinese would want to either given the chance. Since I first came to China I have always found the cost of living substantially higher than one would assume it would be in China, and even this has increased substantially in the last few years.
And I have to ask @M where these 800RMB rooms in Beijing are to be found? I daren’t even put what I’m paying for fear of reprisal…
Pretty cool living, my mother back in Russia earns less than this girl’s 1800 RMB a month yet the food and transport prices are several times higher.
i am going to Changsha for my master digree for 2 years
how much cost the good living in Changsha
400 US$ per month is it good or less or high
for $400 per month you will be able to get by, but it largely depends on how much you spend on rent and what kind of restaurants you eat in. You would be living similarly to a recent college graduate with a good job.
I am trying to get a job in China as a Software Engineer, probably will get salary from 25-30K Yuan /month. Is this good money in China ? How much I can save ? I ll be living alone, so what is living cost there for one person ? What are probable other expenses there? Please guide me.