Do You Make Enough to Live Comfortably in These 5 Major Cities?

These major cities aren't exactly cheap.
  • GOBankingRates determined the required salary to comfortably live in 50 of America’s biggest cities.
  • The cost of living is high for most city residents on their current salaries.
  • The cities with the highest incomes needed to live comfortably include Los Angeles, New York City and Washington, D.C.

Being a resident of some of America’s biggest cities can really stretch your budget. Your annual salary needs to be able to cover your expenses so you can live comfortably. Do you earn enough money to cover your bills and save money for the future?

GOBankingRates determined the required salary needed to live comfortably in 50 of America’s biggest cities. This study evaluated the cost of living by analyzing the annual cost of necessities, rent or mortgage costs and median household income between 2016 and 2019. The cost of necessities includes groceries, utilities, transportation and healthcare. The 50/30/20 rule was also implemented, which assumes that 50% of your income goes toward necessities, 30% toward discretionary spending and 20% toward savings.

Check out what it will cost you to live comfortably in these five major U.S. cities — and see the cities that require the highest and lowest salaries.

See the Full Study: How Much You Need to Live Comfortably in 50 Major US Cities

The Salary Needed To Thrive in These 5 Major Cities

Living in one of America’s favorite cities can be expensive. Many residents are struggling to afford living expenses, savings and splurges on nonessentials on their current salaries. Here is how much you’ll need to make in 2019 in order to live in these five locations.

Los Angeles

Los Angeles in the evening hour.
4kodiak / Getty Images

Income needed to live comfortably (renter): $136,207
Income needed to live comfortably (homeowner): $150,391

Los Angeles ranks No. 3 in the state for highest required salary. The city’s comfortable living income was $110,420 just a year ago. A large factor contributing to this almost $40,000 difference in income for homeowners is annual transportation costs, which have nearly doubled at $18,290.

The annual rent and mortgage payments in the city sit at $37,656 and $44,748, respectively. With a median household income of just $54,501, residents of Los Angeles are a far cry from being able to afford annual living expenses.

Related: The Salary You Need to Live Comfortably in LA Is Staggering

New York City

Brooklyn Bridge New York City
Sean Pavone / Getty Images/iStockphoto

Income needed to live comfortably (renter): $128,552
Income needed to live comfortably (homeowner): $148,448

The income needed to live comfortably in New York City was $86,782 just two years ago, and most of the city’s living expenses have been steadily climbing ever since. Annual utilities costs rose significantly in the past year from $2,178 to $5,792.

The current median household income sits at a low $57,782, which is $70,770 less than you need to live comfortably as a renter in the city that never sleeps. The $28,188 annual rent payment makes it nearly impossible to live without a roommate. But with a population of around 8.5 million, that shouldn’t be a problem to find.

Find Out: Why You Should Flee New York City When It’s Time to Retire

Washington, D.C.

Chinatown in Washington DC
Alexander Farnsworth / Getty Images

Income needed to live comfortably (renter): $122,933
Income needed to live comfortably (homeowner): $142,229

The income needed to live comfortably in the capital was $103,147 in 2018, $39,082 lower than what is necessary for a homeowner to have the same comfort now. The total annual cost of necessities is $71,115 if you are paying a mortgage and $61,467 if you are paying rent. The largest contribution to the total is the annual transportation cost of $15,417.

The average mortgage payment is $42,960, with the annual rent payment slightly lower at $33,312. Annual rent was just $32,208 in 2018.

Also See: The Income You Need to Live Well in Washington, DC Skyrockets

Chicago

Navy PIer aerial of Chicago Illinois
Thomas Campone / Getty Images/iStockphoto

Income needed to live comfortably (renter): $94,917
Income needed to live comfortably (homeowner): $84,765

The income needed to live comfortably in Chicago was $19,023 less for renters just a year ago, while the total annual cost of necessities was $37,947. This number is considerably smaller than current annual expenditures at $42,382 for homeowners and $47,458 for renters.

Transportation again contributed to a high cost of necessities. Chicago residents now pay an average of $15,321 for transportation, which is a considerable jump from the $8,643 they paid in 2018.

Surprisingly, the annual rent payment is actually higher than the annual mortgage cost in Chicago at $19,836 and $14,760, respectively.

Job Seekers: Want to Work in the Media? Don’t Overlook Chicago

Houston

people riding along pathway in Houston Texas
©Shutterstock.com

Income needed to live comfortably (renter): $87,658
Income needed to live comfortably (homeowner): $79,378

Among these five cities, Houston has the lowest median home value at just $194,600. The income needed to live comfortably in Houston last year was $73,437, a $5,941 increase for homeowners and a $14,221 increase for renters.

The total annual cost of necessities in 2018 was $36,718. However, the current difference between median salary and annual expenditures is $9,710 for homeowners and $5,570 for renters, making it easier for Houston residents to save money for the future.

Elsewhere in Texas: This City Outside of Dallas Is Seeing More Female Workers

Cities Where You Need the Highest and Lowest Salaries

Although the five cities previously mentioned have high salaries, there are a few cities where the salary needed to live comfortably is even higher. Here’s a look at the five most expensive cities that require the highest salaries:

Most Expensive Cities for HomeownersMost Expensive Cities for Renters
City, StateIncome You Need as a HomeownerCity, StateIncome You Need as a Renter
San Francisco, California$230,285.54San Francisco, California$164,213.54
San Jose, California$197,502.26San Jose, California$143,670.26
Honolulu, Hawaii$190,201.30Los Angeles, California$136,207.60
Los Angeles, California$150,391.60New York, New York$128,552.42
New York, New York$148,448.42Oakland, California$128,282.18

The three most expensive cities for homeowners isn’t too surprising — San Francisco, San Jose and Honolulu all have median home values that exceed $1 million. At the time the study was conducted, the median home values in Los Angeles and New York were $734,300 and $619,200, respectively.

If you’re a renter, you should still aim for a six-figure salary in those five cities (you’ll need $125,329.30 to live comfortably in Honolulu as a renter). But you’ll also need to make six figures in Oakland, where rent can set you back over $3,000 a month.

Fortunately, not every major city requires a $100,000 annual income. GOBankingRates’ study looked at 50 major cities and found there are a few where the salary needed is much lower. Here’s a look at the most affordable cities that require the lowest salaries:

Most Affordable Cities for HomeownersMost Affordable Cities for Renters
City, StateIncome You Need as a HomeownerCity, StateIncome You Need as a Renter
Cleveland, Ohio$55,139.10Cleveland, Ohio$64,883.10
Memphis, Tennessee$63,594.52El Paso, Texas$68,960.72
El Paso, Texas$64,592.72Memphis, Tennessee$69,330.52
Indianapolis, Indiana$65,250.26Tulsa, Oklahoma$69,740.28
Tulsa, Oklahoma$65,660.28Indianapolis, Indiana$70,962.26

What’s particularly interesting about this list is Cleveland — it’s the only city where you can live comfortably making less than $60,000 a year. But keep in mind this is if you choose to live in a single-family residence as a homeowner.

But if you’re considering living in a one-bedroom apartment, keep reading to see 35 cities where you can live comfortably on less than $50,000.

More on Living Comfortably

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Methodology: GOBankingRates found the cost of living in America’s 50 biggest cities by analyzing the following factors: (1) Cost of living index for groceries, utilities, transportation and healthcare sourced from Sperling’s Best Places. Each index was multiplied by the annual expenditure amount in each category from the Bureau of Labor Statistics’ 2017 Consumer Expenditure Survey, which measures household annual mean expenditures to determine the annual mean spending for each category; (2) Rent costs were sourced from Zillow’s February 2019 rental value index for single-family residences, and were multiplied by 12 to obtain annualized spending on rent; (3) Mortgage rates were based off of Zillow’s February 2019 median home value, and Zillow’s mortgage calculator was used to determine the monthly mortgage payment for each given city based off of the home value and a 30-year fixed loan. Mortgage payments were multiplied by 12 to obtain an annualized amount; (4) Median household income was sourced from the U.S. Census Bureau’s 2017 American Community Survey (this is income prior to being taxed). Once all the data was found, the annual expenditure amount was calculated by adding together the annual spending for each category. GOBankingRates found the annual expenditures for both people paying a mortgage payment and for people who are paying rent separately, and the median income was subtracted by annual expenditures for those paying a mortgage and those renting to see how much money is needed or left over for each city. GOBankingRates then used the 50/30/20 rule, which assumes that 50% of income should go toward necessities, 30% should go toward discretionary spending and 20% should go toward savings. The 50% income is the annual expenditure, and that amount was used to find the additional income needed for splurges and savings.