Cost of living in france: five things that have changed

PENSION PAYMENTS, INTEREST RATES, AND FUNERAL COSTS HAVE ALL SEEN SIGNIFICANT CHANGES The start of the new year brings with it a series of changes. The Connexion has previously detailed

changes in areas including healthcare, residency, and driving.  Read more: Healthcare: What's new in France in 2025 Read more: Money, inheritance, tax, pensions: What's new in

France in 2025 Read more: Cars and driving: What's new in France in 2025 Read more: Residency rights and border changes: What's new in France in 2025 Read more: Dozens of new

flight and ferry routes for France in 2025 Below, we detail five of the biggest changes to the pouvoir d’achat (purchasing power, or cost of living) to those residing in France this year. 

FRENCH PENSION INCREASE  Millions who receive a French pension saw it increase by 2.2% on January 1.  Former prime minister Michel Barnier wanted to delay the indexing of this year’s

pensions to inflation levels – a process done automatically outside of the annual budget – to July, reducing the annual increase to 1.5% and only seeing the majority of pension increases

take effect from the latter half of the year.  His plans, which were part of his government’s proposed 2025 budget, ended with his ousting meaning pension increases from January at the

previously-expected levels.  It corresponds to an average €15 monthly increase per person.  Note a minimum monthly gross salary of €1,782 each month for three months is required to ‘earn’ a

quarter (trimestre) of French pension payouts.  This increase corresponds to last November’s minimum wage hike (the two are tied) and should not affect those working full-time who are

earning at least the minimum wage. However it may impact those with monthly earnings less than this, such as part-time workers. Read more: France’s minimum wage will not automatically rise

on January 1 CHANGES TO ECO-FRIENDLY HOME RENOVATION GRANTS  Changes have been made to the government’s MaPrimeRénov’ scheme which partly funds eco-friendly home renovations. Certain rules

brought in last year for single-project renovations (mono-gestes) have been extended. These include funding to upgrade single-family properties (essentially, not flats) with an ‘F’ or ‘G’

rating, and a temporary end to the requirement for a Diagnostic de performance énergétique (DPE) rating for properties prior to an application. However, funding levels for the lowest income

households have been reduced from 70% to 50% in some cases, as they have for higher income households even in cases where the renovations see a property’s DPE ranking increase significantly.

  Read more: French grants for home renovations are changing NEW RULES ON TOURIST LETTINGS  Short-term rentals through such as gîtes, or hosted via sites including Airbnb face further

restrictions this year.  Alongside potential limits to the number of properties which can be used for short-term rentals and the number of days they can be made available for rent, tax

allowances for owners who let such properties have been reduced to be closer to the allowances available if letting in the more traditional longer-term market.  Read more: Airbnb rental laws

to be toughened in France  INTEREST RATES CUT FOR NEWLY OPENED SAVINGS ACCOUNTS AND LATE PAYMENTS  The interest rate on a plan épargne logement (PEL, savings account for a home purchase)

opened after January 1 have dropped to 1.75%. Prior to this, the rate was 2.25%.  The rate on the account remains fixed from the date it is opened and has historically fluctuated, dropping

as low as 1% in August 2016.  Interest rate changes for other savings accounts, including the government-regulated tax-free Livret A, have not been announced, but are widely expected to fall

at some point this year.  The Livret A currently has an interest rate of 3%.  The interest rate on late payments for private individuals (taux d’intérêt légal, or legal interest rate) will

fall from 8.16% to 7.21%. This is used in areas such as banking and property loans. The rate will be reevaluated on June 30. FUNERAL EXPENSES INCREASE  The amount which can be taken from the

deceased’s bank account to cover funeral expenses where there is not a funeral policy in place to cover these has risen to €5,910 from last year’s figure of €5,000.  Read more: France

changes its deadline rules for burials and cremations OTHER CHANGES  Other changes which may have an indirect effect on expenses include those relating to clearing garden undergrowth

(obligations légales de débroussaillement) and driving restrictions in four French cities.  You can read about these and other changes below. Read more: 15 changes in France from January 1,

2025