10 Cities Where Median Incomes Align With Cost of Living
Written by
Josephine Nesbit
Edited by
Rebekah Evans
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Over the last few years, Americans have noticed that their dollars don’t stretch as far anymore. Inflation and the ever-rising cost of living have forced many to tighten their belts, but some U.S. cities are faring better than others.
According to data from The Council for Community and Economic Research’s Cost of Living Index, which measures regional differences in the cost of everyday goods and services in 269 urban areas, the after-tax cost for a professional standard of living ranged from more than twice the national average in New York City to more than 20% below the national average in Decatur, Illinois.
The composite cost of living index is based on six weighted categories: housing, utilities, grocery items, transportation, health care and miscellaneous goods and services. A composite score of 100 is the national average. Scores above 100 are above average, while scores below 100 are below average.
These are the least expensive cities as of quarter three of 2023:
Decatur, Illinois
- Composite score of 77.0
Harlingen, Texas
- Composite score of 79.7
McAllen, Texas
- Composite score of 80.2
Ponca City, Oklahoma
- Composite score of 80.4
Augusta-Aiken, Georgia-South Carolina
- Composite score of 82.8
Anniston-Calhoun County, Alabama
- Composite score of 83.0
Florence, Alabama
- Composite score of 83.0
Ashland, Ohio
- Composite score of 83.0
Conway, Arkansas
- Composite score of 83.1
Tupelo, Mississippi
- Composite score of 83.1
In a recent study published by SmartAsset, an individual needs to earn at least $96,500 annually on average to live comfortably in a major U.S. city. This includes being able to pay off debt and invest for the future. For a family of four, two working adults need to make an average income of about $235,000 without living paycheck to paycheck. In six U.S. cities, a family needs to make over $300,000.
These figures were calculated using the popular 50/30/20 rule, which recommends allocating 50% of your salary toward needs, such as housing and groceries, 30% toward entertainment and fun and 20% toward paying off debt, saving and investments.
The average U.S. salary falls well below the recommended annual income. According to the U.S. Bureau of Labor Statistics, the national average salary in the U.S. in quarter four of 2023 was $59,384, as reported by USA Today.
Although this income may not work in more expensive cities without making budget cuts, it could work in cities where the median income better aligns with the cost of living.
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