Would a million pounds mean a millionaire lifestyle?

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Lottery winner David Ashcroft was recently reported to have spent almost nothing of the £12million he won in 1997, and he still lives the life he had before; working as a furniture repairer and living with his parents in the same modest house.

While Mr Ashcroft has his own personal reasons for not spending it, most people would undoubtedly choose to lead a millionaire lifestyle if they could.

However, these days you would need closer to the £12million David Ashcroft won to live the sort of life most people associate with having a million pounds.

The things tremendous wealth allows you to have and do - partying in Saint Tropez, entertaining friends at your country mansion, wintering in Barbados, owning a yacht, buying a second home - altogether cost a lot more than a million pounds would allow for.

Here's why a million pounds doesn't actually stretch that far anymore, especially if you live in the South of the country.

Housing costs

If you lived in London, and didn't want to leave, you'd have to shell out almost £700,000 for an average priced terraced house in an area such as Hammersmith and Fulham, which, while respectable, is certainly not one of the top areas to live in (in Kensington and Chelsea for example you'd have to spend your million and also need a mortgage for a two-bed plus house).

That would leave you £300,000 to live off. Assuming you didn't want to take much of a risk with it, you could currently get around 6% interest a year with a fixed-term savings bond from one of the major banks.

Don't forget tax

On £300,000, that 6% a year would provide an income of £18,000. However, while Lottery winnings come tax-free, interest on the proceeds doesn't. In this case, you would have to pay around £3,000 to the taxman, leaving you with £15,000 to live off.

That's £300 a week, which doesn't sound bad, but it's hardly enough for a yacht and holiday flat in Tuscany.

Council tax and bills

Additionally, from that sum you would need to deduct bills. Council tax for houses of that value in West London is around £2,000 a year, or £40 a week. Water rates and electricity and gas costs would knock off another £30, at least.