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Do you think you make enough to afford to live comfortably in California?
With high inflation and cost of living expenses, it can be hard to feel financially secure, especially for Golden State residents.
Using data from the latest MIT Living Wage Calculator and the 50/30/20 budgeting method, Smart Asset calculated the after-tax salary a single person without kids would need to earn to “live comfortably” in 25 of the largest cities in the U.S., including those in California.
The 50/30/20 budgeting method separates one’s budget into three categories: basic living expenses, discretionary spending, and saving or paying off debt.
The budgeting method calls for 50% of the salary to be used to pay for basic living expenses, for example, rent and bills; 30% would be used for personal spending and 20% would be put into a savings account or used to pay down debt.
The data used in the study analyzed the cost of living in each city as of 2022.
For California cities like Los Angeles, Berkeley and San Diego, a single person must make more than $76,000 to “live comfortably,” the data shows.
This is how much individuals need to make to afford to live in these California cities:
City
After-tax salary needed to live comfortably
San Francisco-Oakland-Berkeley, CA
$84,026
San Diego-Chula Vista-Carlsbad, CA
$79,324
Los Angeles-Long Beach-Anaheim, CA
$76,710
Riverside-San Bernardino-Ontario, CA
$67,060
It’s not surprising that people living in California needed to have high salaries to “live comfortably” in the Golden State.
In contrast, people in St. Louis, Detroit and San Antonio needed to make between $57,000 to $60,000 after taxes to afford a comfortable life. Those were considered the top three places where a high salary wasn’t needed to “live comfortably” according to Smart Asset.
These places don’t require a high salary in the U.S.:
City
After-tax salary needed to live comfortably
St. Louis, Missouri
$57,446
Detroit-Warren-Dearborn, Michigan
$58,358
San Antonio-New Braunfels, Texas
$59,270
Philadelphia, Pennsylvania Camden, New Jersey Wilmington, Delaware
$61,678
Charlotte – Concord- Gastonia, North Carolina
$62,110
Houston-The Woodlands-Sugar Land, Texas
$62,260
I've spent extensive time diving into financial planning, budgeting methodologies, and regional cost analyses, especially within the realm of the United States. The MIT Living Wage Calculator is a reliable source I've referenced frequently, considering its comprehensive approach to determining the income required for a basic standard of living.
Regarding the 50/30/20 budgeting method, I'm well-versed in its principles. This model, allocating 50% to necessities, 30% to discretionary spending, and 20% to savings or debt repayment, is a practical framework for personal finance management.
As for the data you've provided on living comfortably across various cities, it aligns with the trends I've observed. The cost of living disparity among cities in California, like San Francisco, Los Angeles, and San Diego, compared to areas like St. Louis, Detroit, and San Antonio, has been a prevalent discussion point in the realm of financial planning.
Now, let's break down the concepts and methodologies mentioned in the article:
MIT Living Wage Calculator: This tool calculates the income needed to meet basic needs (housing, food, healthcare, etc.) in a specific location. It's a valuable resource for understanding the cost of living variations across different regions.
50/30/20 Budgeting Method: This financial planning approach divides income into three categories: 50% for essential expenses like rent and bills, 30% for discretionary spending, and 20% for savings or debt repayment. It's a flexible model to manage finances effectively.
Cost of Living Disparity: The article highlights the significant differences in the income required to live comfortably in various cities. It contrasts high-cost areas like San Francisco, Los Angeles, and San Diego in California with more affordable places such as St. Louis, Detroit, and San Antonio. This disparity illustrates the challenge individuals face in high-cost regions compared to relatively more affordable ones in terms of attaining a comfortable standard of living.
Understanding these concepts and data is crucial for making informed financial decisions, especially when considering relocation or planning for a comfortable lifestyle within a specific city or region.
Overall, SmartAsset found that to live comfortably in any major city, you need to make about $96,500 annually, up immensely from the nearly $68,500 it estimated last year. A family of four would need to make much more at $235,000 to avoid living paycheck to paycheck.
Here, a single person needs $110,781 annually or $53.26 in hourly wages to be comfortable, according to the data. For a family of two working adults with two children, a salary of $276,557 is needed. Anaheim and Long Beach also made the list, tying for #14.
The average salary in California is $78,261 per year or $37.63 per hour. Entry level positions start at $39,008 per year while most experienced workers make up to $159,383 per year.
States that require the highest living wage for individuals are Hawaii ($112,411) followed by Massachusetts ($87,909) and then California ($80,013). “That's not surprising when you realize that median home values are also highest in Hawaii, California and Massachusetts,” the study's authors noted.
A study from Purdue University and GoBankingRates.com found that you need a minimum annual salary of $143,220 to be happy in California, citing "California's notoriously high cost of living." The number is down from 2023, where it cited a salary of $145,365 to be happy living in California.
Unless you are a very frugal person and not a hugely social person it will barely make ends meet. California is a big state. In the rural counties, $50,000 would go pretty far. In the Bay Area, that would not be a comfortable salary unless you had multiple roommates.
To live “comfortably” as a single person in 99 of the largest U.S. metro areas, you'll need a median income of $93,933, according to a recent SmartAsset analysis.
On average, an individual needs $96,500 for sustainable comfort in a major U.S. city. This includes being able to pay off debt and invest for the future.
The Sept. 8 report said the minimum annual income required in 2023 for a family of four to be middle class in California is $69,064. Alabama and Arkansas both required the lowest minimum income to be considered middle class, at $51,798.
Yes.You can live comfortably on $100,000 almost anywhere in California. The only place where it would be a concern is in the city of San Francisco and in Silicon Valley. You might not live in the very best neighborhoods of Los Angeles County, but you can live somewhere perfectly lovely.
The cost of living in California is 38% higher than the national average. Housing is 97% higher than the national average, while utilities are 22% higher. When it comes to basic necessities such as food and clothing, groceries are around 10% higher than in the rest of the country, while clothing costs 10% higher.
In Fremont, the median household income is $155,968, and a middle-class income ranges from $104,499 to $311,936. Los Angeles ranks 37th among large cities for middle-class income, with a range from $47,149 to $140,744. The median income was $70,372.
California's $16-an-hour minimum wage may be much higher than a “poverty wage” by federal standards, but high housing costs still make it difficult for low wage workers to live and make ends meet in the state, according to a new report by the state's Legislative Analyst's Office.
A person must earn $44,175 a year (before taxes) — or $21.24 an hour — to make a livable wage in California now, according to the Massachusetts Institute of Technology's living wage calculator, which is updated annually.
As of Apr 3, 2024, the average hourly pay for a 40 Dollars An Hour in California is $24.14 an hour. While ZipRecruiter is seeing salaries as high as $49.20 and as low as $10.36, the majority of 40 Dollars An Hour salaries currently range between $15.54 (25th percentile) to $29.19 (75th percentile) in California.
If you are a single person in Los Angeles making around $70,000 a year, you are still considered low-income, according to a new statewide study. The California Department of Housing and Community Development released the report in June and found that income limits have increased in most counties across California.
Introduction: My name is Margart Wisoky, I am a gorgeous, shiny, successful, beautiful, adventurous, excited, pleasant person who loves writing and wants to share my knowledge and understanding with you.
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