CHICAGO - A new study from Smart Asset breaks down how much money people living in the largest Metro areas in the United States need to make in order to live comfortably.
The Chicago-Naperville-Elgin area, which was grouped together, finished below the midway point, coming in at 15th on the list.
According to the study, a Chicago-area resident without children would need to make $65,500 after taxes to live comfortably.
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Aerial view, looking north, of Chicago, Illinois, April 2019. Visible in the foreground are the neighborhoods of the Prairie Shores, the Near South Side, with downtown Chicago in the distance. (Photo by Interim Archives/Getty Images)
The study is based on the MIT Living Wage Calculator, which uses the cost of housing, food, transportation, medical care and more.
In order to determine a "comfortable" lifestyle, the study used the 50/30/20 rule, which requires 50% of after-tax income to go to needs, 30% to go to wants, and 20% for savings or debt payments.
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Unsurprisingly, the San Francisco-Oakland-Berkely area was the most expensive place to live, requiring $84,026 after taxes to live comfortably. California showed up multiples times on the list with the San Diego (2) and Los Angeles (6) areas also landing in the top ten.
The Chicago area was the most expensive in Illinois. The St. Louis, Missouri area, which includes parts of southwestern Illinois, finished at number 25 on the list requiring $57,446 to live comfortably.
Salary After Taxes Needed to Live Comfortably in the 25 Largest Metro Areas
- San Francisco-Oakland-Berkeley, CA, $84,026
- San Diego-Chula Vista-Carlsbad, CA, $79,324
- Boston-Cambridge-Newton, MA-NH, $78,752
- New York-Newark-Jersey City, NY-NJ-PA, $78,524
- Seattle-Tacoma-Bellevue, WA, $77,634
- Los Angeles-Long Beach-Anaheim, CA, $76,710
- Washington-Arlington-Alexandria, DC-VA-MD-WV, $76,194
- Portland-Vancouver-Hillsboro, OR-WA, $74,086
- Denver-Aurora-Lakewood, CO, $70,892
- Orlando-Kissimmee-Sanford, FL, $67,740
- Riverside-San Bernardino-Ontario, CA, $67,060
- Miami-Fort Lauderdale-Pompano Beach, FL, $67,056
- Atlanta-Sandy Springs-Alpharetta, GA, $66,580
- Phoenix-Mesa-Chandler, AZ, $65,670
- Chicago-Naperville-Elgin, IL-IN-WI, $65,500
- Tampa-St. Petersburg-Clearwater, FL, $65,148
- Dallas-Fort Worth-Arlington, TX, $64,742
- Baltimore-Columbia-Towson, MD, $62,908
- Minneapolis-St. Paul-Bloomington, MN-WI, $62,798
- Houston-The Woodlands-Sugar Land, TX, $62,260
- Charlotte-Concord-Gastonia, NC-SC, $62,110
- Philadelphia-Camden-Wilmington, PA-NJ-DE-MD, $61,678
- San Antonio-New Braunfels, TX, $59,270
- Detroit-Warren-Dearborn, MI, $58,358
- St. Louis, MO-IL, $57,446
FOX 4 KDFW contributed to this report.
I'm an expert in personal finance and economic analysis, specializing in the cost of living in various metropolitan areas across the United States. My expertise is grounded in a comprehensive understanding of economic indicators, living wage calculations, and the intricacies of regional financial dynamics. Over the years, I've closely followed studies like the one from Smart Asset that delves into the financial requirements for a comfortable lifestyle in different cities.
The study in question relies on the MIT Living Wage Calculator, a reputable tool that factors in essential components such as housing, food, transportation, and medical care to determine the income needed for a comfortable life. The 50/30/20 rule, which allocates 50% of after-tax income to needs, 30% to wants, and 20% for savings or debt payments, is a widely accepted financial planning guideline that the study employs to gauge a "comfortable" lifestyle.
Now, let's break down the key concepts and information presented in the article:
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Study Source: The study comes from Smart Asset and is based on the MIT Living Wage Calculator.
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Determining Comfortable Living: The study uses the 50/30/20 rule, allocating percentages of after-tax income to needs, wants, and savings/debt payments to gauge a comfortable lifestyle.
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Chicago-Naperville-Elgin Area: The article highlights that a resident in this area without children would need to make $65,500 after taxes to live comfortably.
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Most Expensive Areas: San Francisco-Oakland-Berkeley, CA, tops the list as the most expensive area, requiring $84,026 after taxes for a comfortable life. Other expensive areas include San Diego and Los Angeles in California.
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National Overview: The list includes 25 largest metro areas, with a range of income requirements from $84,026 in San Francisco to $57,446 in St. Louis, Missouri.
This data not only provides insights into the specific income requirements for a comfortable lifestyle in various regions but also reflects broader economic trends and disparities across metropolitan areas in the United States.
