The rising cost of living: why everything feels so expensive now
Financial Interest was founded by Damien Talks Money (391,000 YouTube subscribers) to teach the personal finance lessons he wished he'd been taught at school.
Last updated 8th May 2026
8 min read
Recently, the UK finally hit the Bank of England's 2% inflation target. Since then, despite rising slightly to 2.2%, things have appeared to be relatively steady.
But the official inflation figure, along with headlines claiming the cost of living crisis is easing, can create an unfair perception of our finances, leading to widespread confusion, stress, and sadness in the general public.
If inflation has truly been tamed, why does everything feel so much more expensive now?
Did costs really only increase by 2% this year?
Why are we continuing to feel increasing financial pressures?
Today, we've answered these questions by assessing the damage that's added up over the last five years.
We looked at energy bills, grocery shopping, house prices, the investment market and more to provide a more accurate overview of the true cost of living in the UK.
Financial Interest provides guidance, not advice. If you’re unsure about anything, speak with a qualified adviser. When investing, your capital is always at risk. Past performance does not guarantee future results.
Energy
| 2019 | 2024 | Difference | |
|---|---|---|---|
| Gas | £630 | £1,216 | 93% |
| Electric | £619 | £1,282 | 107.1% |
The average gas and electric bill has doubled over the last five years, going from a combined annual cost of £1,249 all the way up to £2,498 – an increase of exactly 100%.
Groceries
| Item | June 2019 | June 2024 | Increase |
|---|---|---|---|
| Olive oil | £3.65 | £9.03 | 135.77% |
| Granulated white sugar | £0.71 | £1.20 | 70.42% |
| Frozen beef burgers | £2.22 | £3.56 | 66.67% |
| Baked beans | £0.61 | £1.02 | 66.13% |
| Still mineral water | £0.64 | £1.04 | 63.49% |
| Plain biscuits | £0.82 | £1.35 | 62.65% |
| Individual cakes | £1.36 | £1.94 | 60.47% |
| Can of dog food | £0.67 | £1.06 | 58.21% |
| Flavoured water | £0.62 | £0.95 | 56.45% |
| Hot chocolate drink | £2.31 | £3.55 | 54.01% |
| Lemonade | £0.68 | £0.99 | 51.52% |
| Chicken kiev | £1.87 | £2.73 | 50.83% |
| Cook-in sauce | £1.22 | £1.90 | 50.00% |
| Mayonnaise | £1.50 | £2.19 | 49.66% |
| Semi-skimmed milk | £0.84 | £1.25 | 49.40% |
| Iceberg lettuce | £0.66 | £0.92 | 49.21% |
| Mixer drink | £0.88 | £1.29 | 47.73% |
| Washing detergent | £4.31 | £6.25 | 47.45% |
| Fruit juice (exc. orange juice) | £0.92 | £1.34 | 45.65% |
| Chilled pot dessert | £0.62 | £0.90 | 45.16% |
| Canned sweetcorn | £0.71 | £1.03 | 45.07% |
To calculate part of the official inflation figures, the Office for National Statistics (ONS) tracks the price changes of a 'basket of goods', which includes hundreds of items that the general public buys.
The list of goods that significantly increased in price since 2019 was so large that we had to limit what we displayed above in multiple ways: a minimum 45% increase in price, and we excluded all items that wouldn't commonly be purchased in a weekly grocery shop.
The full list includes 384 items that increased in price between June 2019 and June 2024.
Other notable increases include a 55.46% increase in the price of theatre tickets and a 43.55% increase in the cost of hotel stays. We've been highlighting 'services' inflation for months in our newsletter, and these stats speak volumes.
[Source: ONS]
Only 16 items in the government's 'basket of goods' decreased over the time period, and just one was something you'd buy on the average grocery shop:
| Item | June 2019 | June 2024 | Increase |
|---|---|---|---|
| Baking potatoes | £1.06 | £0.95 | -7.77% |
Spud Man must be doing even better than we thought.
Many items that saw decreases were electronic, which typically come down in price long-term anyway. Examples of this include headphones (down 5.94%) and large TVs (down 19.35%).
The largest price drop was with light bulbs, down 27.1%.
Primary school meals decreased 24.22%, one of the only truly positive takeaways we found in this data.
And speaking of takeaways, here's how some of those changed in price:
Takeaways
| Item* | Increase 2019-2024 |
|---|---|
| Fish and chips | 52.47% |
| Kebab | 42.47% |
| Chicken and chips | 41.65% |
| Cooked pastry | 34.19% |
| Cold sandwich | 31.16% |
| Soft drink | 30.37% |
| Takeaway or delivery pizza | 30.02% |
| Chinese main course | 29.35% |
| Indian main course | 29.29% |
House prices
England
| Property Type | 2019 | 2024 | Difference |
|---|---|---|---|
| Detached | £374,455 | £457,210 | 22.10% |
| Semi-detached | £231,400 | £287,901 | 24.42% |
| Terraced | £199,663 | £246,086 | 23.25% |
| Flats | £224,030 | £246,526 | 10.04% |
| All property | £246,502 | £298,052 | 20.91% |
The nominal difference of detached houses in England was the largest difference in this dataset, with an increase of £82,755.
In percentage terms, though, England saw the smallest rise in the UK.
Inflation-adjusted prices in this area are technically becoming cheaper – CPI stands at 24% for the last five years, a figure that generally exceeds the price increase of properties in England.
However, this highlights another flaw in commonly-shared statistics.
While the inflation-adjusted price of housing in England has fallen in recent times, this doesn't mean they've become more affordable.
The average house cost 7.88 times an individual's average earnings in England in 2019, but this figure had risen to 8.26 last year. This is the highest figure on record, excluding pandemic-affected prices in 2021 (9.06) and the hangover effect from that in 2022 (8.47).
Scotland
| Property Type | 2019 | 2024 | Difference |
|---|---|---|---|
| Detached | £260,448 | £332,498 | 27.66% |
| Semi-detached | £158,735 | £201,148 | 26.72% |
| Terraced | £126,512 | £159,449 | 26.03% |
| Flats | £109,757 | £131,184 | 19.52% |
| All property | £151,955 | £188,614 | 24.12% |
Wales
| Property Type | 2019 | 2024 | Difference |
|---|---|---|---|
| Detached | £246,214 | £317,692 | 29.03% |
| Semi-detached | £157,711 | £207,564 | 31.61% |
| Terraced | £126,512 | £167,148 | 32.12% |
| Flats | £114,970 | £138,016 | 20.04% |
| All property | £163,212 | £212,386 | 30.13% |
Northern Ireland
| Property Type | 2019 | 2024 | Difference |
|---|---|---|---|
| Detached | £205,141 | £275,885 | 34.49% |
| Semi-detached | £134,231 | £175,768 | 30.94% |
| Terraced | £96,544 | £125,826 | 30.33% |
| Flats | £109,772 | £136,019 | 23.91% |
| All property | £137,907 | £181,183 | 31.38% |
It was Northern Ireland that saw the largest percentage increases in house prices overall, with detached houses seeing the major difference – a 34.49% increase in price in five years.
[Source: HM Land Registry]
Equities
As an investment-focused website, we also looked at the stock market.
Many people, ourselves included, believe you need to own assets to build wealth. Stocks and shares are arguably the most accessible option for people to start acquiring assets, so let's start there.
All investments have risk. You can lose money when investing.
| Index | 2019 | 2024 | Difference (%) |
|---|---|---|---|
| FTSE 100 | 7,207.18 | 8,376.63 | 16.2% |
| S&P 500 | 2,940.18 | 5,471.05 | 86.1% |
| FTSE All World | 78.44 | 119.74 | 52.7% |
| MSCI World Price Index | 520.65 | 807.02 | 55% |
Shares in UK companies have not risen in line with inflation, with the FTSE 100 index (a list of the top 100 businesses in the UK) only increasing by 16.2% over the last five years.
However, UK investors also invest in global stocks.
Global stocks have increased in price significantly, mainly driven by the US – the S&P 500 is up 86.1% in the same timeframe.
Commodities
| Commodity | 2019 | 2024 | Difference |
|---|---|---|---|
| Gold | £1,156.07/oz | £1,927.16/oz | 66.7% |
| Silver | £13.62/oz | £21.99/oz | 61.5% |
Investors often look to the potential security of gold in times of trouble, and while data suggests it isn't necessarily a reliable safe haven, its spot price has increased significantly – up 66.7%.
Digital commodities like Bitcoin and Ethereum were up 512.3% and 1,361% respectively over this time, but percentage increases are bigger when starting smaller. Going from 1 to 2 is the same nominal increase as going from 99 to 100, but one of those is a 100% increase whereas the other is just under 1%.
But what about increases in pay?
| 2019 | 2024 | Increase | |
|---|---|---|---|
| Average salary | £30,378 | £36,281* | 19.4% |
| Inflation (CPI) | 107.9 | 133.8 | 24% |
The average full-time salary in the UK has increased by around 19.4% in the last five years.
However, the UK's official inflation metric, CPI, has increased by 24% during the same time frame.
Put simply: costs are increasing at a faster rate than your income.
But things get worse...
The tax burden
It's not just costs rising more quickly than our salaries that is making us feel the pinch: we're getting taxed more, too.
The £12,570 personal tax allowance hasn't changed since 2021. HMRC reported that this led to an increase of 4.4 million taxpayers in the UK.
When it comes to higher rates of tax, approximately 12-13% of UK adults now hit the 40% bracket.
Back in the 90s, almost no nurses and only 5-6% of teachers paid higher rate tax. Soon, those numbers will exceed 12.5% and 25% respectively, according to the Institute for Fiscal Studies.
The number of people paying the top rate of tax is also likely to be increasing at a record pace.
In 2023, the additional rate (45%) bracket was lowered from £150,000 to £125,140, and the number of people hitting higher tax bands simply via inflation-matching pay rises, in a concept known as fiscal drag, has continued to increase.
The government predicts there will be more than twice as many top rate taxpayers with this change.
Higher costs. More tax.
And with the decline of the NHS, amongst many other failures of expenditure with public money, we're also getting significantly less bang for our buck.
Affordability
Inflation being under control is one thing, but affordability is another beast entirely.
Here's what Financial Interest's founder and host of the popular YouTube channel Damien Talks Money, Damien Jordan, had to say on this matter:
"Our research has shown how the cost of everyday goods for everyday people has gone through the roof in the last few years. Consistent inflation has accumulated to produce prices that are 50-100% higher in some circumstances since 2019.
The 2% headline rate of inflation is very misleading when it comes to certain items that people buy every day – the price of baked beans has increased by over 66% in the last five years, semi-skimmed milk is up nearly 50%, pasta and rice both around 30%. The average takeaway meal now costs over 35% more than it did pre-pandemic.
The pressure being exerted on people's purchasing power is permanent. Prices rarely go down.
What we need to resolve this situation is a sustained and consistent improvement in real wages so that purchasing power can catch up.
Given this impact on the general public, I'd like politicians to do more to acknowledge these price increases, rather than pretend things are fixed just because we're consistently at, or close to, an arbitrary 2% inflation target – a target that was plucked out of thin air in New Zealand in 1989, rather than being based on any specific economic theory.
I also think it's important to spell out to the public that the inflation problem might not be over. We should be honest about the reality of costs now and what the realities might look like going forward.
Historically, periods of high inflation tend to be followed by prolonged volatility, so I don't know how far out of the woods we are yet, but I hope the figures we have provided at least validate your feelings about how expensive day to day life has become."
Financial Interest provides guidance, not advice. If you’re unsure about anything, speak with a qualified adviser. When investing, your capital is always at risk. Past performance does not guarantee future results.
