Cost of Living in Nigeria

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Underestimating the high cost of living in Nigeria is one of the worst relocation mistakes an expat can make. Expats with little knowledge of this West African country may naively assume life in Lagos or Abuja is relatively affordable. In reality, Nigeria’s two largest urban centres are ranked as two of the most expensive cities in Africa. Mercer’s Cost of Living Survey for 2023 ranked Lagos 47th and Abuja 140th out of 227 global destinations.

Rural areas and smaller urban centres in Nigeria levy a far less expensive lease on life, but the majority of expats are concentrated in the two locales above.

Many may wonder how an African country, often knocked for its high inequality, crime and corruption, can beat out global powerhouses such as Hamburg and Barcelona in the cost of living calculations. One answer is the high prices for amenities that are called for in the typical expat lifestyle.

Another lies in Nigeria's rich oil reserves, which have allowed economic expansion to explode. As a result, private investment in luxuries and amenities catering for businesses and foreigners has skyrocketed, with ordinary living prices increasing too.

Cost of accommodation in Nigeria

The cost of accommodation in Nigeria is undeniably high. In most cases, hiring companies will not only find and secure housing for their expatriate staff but also foot the bill. Many foreign companies have purchased or sub-let housing in areas known as 'expat enclaves', which are well-furnished and readily prepared to make the necessary home arrangements. This can be a life-saver; otherwise, expats may have to pay upfront rent for several months to a year.

Additionally, due to Nigeria’s high crime rates and unreliable electricity supply, expats must also prepare to account for security and extra facility (generator) costs.

Generators

The power supply in Nigeria is inconsistent and unreliable. Sometimes, the power supply goes off entirely for extended periods. Consequently, many expats and locals invest in a generator. These convenient power supplies can be one of the biggest drains on one’s finances. They are incredibly costly to buy, install and run as they will need to be refuelled regularly and checked consistently to ensure they remain safe.

Cost of transport in Nigeria

Much like accommodation, the cost of driving and getting around in Nigeria can also levy some unexpected fees. Most expats prefer to hire a driver to negotiate the traffic and gridlock that besieges the Giant of Africa's under-maintained roadways. The driver's monthly salary must be tacked onto the expected costs associated with transport (car payments, petrol and car insurance). Nevertheless, employers will often subsidise these costs.

Taking public transport in Nigeria is not a highly recommended option. The ramshackle buses and improvisational motorbike taxis (okadas) are often unroadworthy and risky.

Cost of groceries in Nigeria

Expats may find the price of groceries in Nigeria to be a mixed bag, with locally sourced produce generally being more affordable while imported goods tend to have a higher price tag. The local markets offer a colourful array of reasonably priced local produce and exotic fruits, allowing for a cultural and economical shopping experience.

Inflation and foreign exchange shortages have exacerbated this divide in price, significantly driving up the price of certain staples. The price discrepancy is noticeable even within the same country, as urban areas and affluent neighbourhoods often have higher prices than rural areas. The cost of groceries is an essential budgetary consideration and can significantly impact an expat’s cost of living in Nigeria.

Cost of entertainment and eating out in Nigeria

Engaging in leisure activities and enjoying a meal out can be relatively reasonable but can escalate depending on one’s choice of venue and activity. A basic dinner for two in a local eatery is modestly priced, while a three-course meal at a mid-range restaurant is noticeably higher. The price of a cinema ticket falls somewhere in between, providing a moderate entertainment option. Fitness enthusiasts might find gym memberships on the higher side, though still within reach.

Clothing, however, presents a more favourable picture. Quality apparel and footwear from well-known brands are surprisingly affordable, especially compared to prices in many North American or Western European countries.

Cost of education in Nigeria

Expats don't generally consider Nigerian educational standards up to par, and those moving to Nigeria with children will likely need to factor the cost of private schooling into their budgets. Tuition fees for private international schools are known to be high. These schools often offer high teaching standards, excellent facilities and globally recognised curricula, making the value well worth the price.

Still, most of these schools’ fees will also not cover things such as uniforms, textbooks, school trips or even end-of-year external exams, so it is worth negotiating an allowance for school fees in an expat employment contract.

Cost of healthcare in Nigeria

Healthcare presents a significant concern both in terms of quality and cost. While these are rapidly improving, the standard of healthcare services is relatively low compared to many other countries, and the costs can be high, especially for more comprehensive or specialised treatment. A single night’s stay in a hospital can be relatively expensive, which often leads expats to consider private international health insurance for covering regular medical needs.

This situation is further complicated by a lack of substantial government investment in healthcare, necessitating out-of-pocket expenses for medicines and treatments that can quickly add up. The option of private health insurance, which can also cover expatriation for severe medical conditions, becomes an almost essential consideration for expats aiming to safeguard their health while residing in Nigeria.