Grim new data has revealed how much Americans need to earn to live comfortably in the country’s largest cities.
By analyzing data from the US Census, the Bureau of Labor Statistics and Zillow housing market, GOBankingRates found that to afford living in the US’s most expensive cities, Americans need a salary of at least $125,000.
Even in the most affordable city on the list – Detroit – residents still need an annual income of almost $65,000 to live comfortably.
The study ‘comfortable living’ assessed using the 50/30/20 rule.
Here, 50 percent of a person’s income is spent on living expenses, 30 percent is disposable and 20 percent goes to savings.
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Of the eight cities where Americans need the highest salaries to live comfortably under this measure, six are in California.
In San Jose, the most expensive city on the list, Americans must earn a staggering salary of $265,926 to cover an annual cost of living of $132,963 – and have money left over for saving and spending.
In San Francisco, local residents must earn at least $252,878, compared to $207,332 in San Diego and $194,500 in Los Angeles.
In Long Beach, meanwhile, Americans still need to earn $177,553 to live comfortably, or $171,898 in Oakland.
Other large and notoriously expensive cities, including New York City, Washington, DC, Boston and Miami, require an annual salary of at least $140,000 to live comfortably, GOBankingRates found.
According to the Bureau of Labor Statistics, the average salary in the US is $59,228.
This is less than the income needed to live comfortably in Detroit, the most affordable big city on the list of 50 compiled by GOBankingRates.
It’s also far below other, cheaper cities, including Memphis, Indianapolis or Oklahoma City – where the annual cost of living is $37,605, but residents need a salary of $75,211 for a comfortable life.
The grim numbers come as the cost of living in the US has risen in recent years.
The costs of many essential items have risen dramatically, leaving households in dire straits.
In San Jose, the most expensive city on the list, Americans must earn a staggering salary of $265,926 to cover an annual cost of living of $132,963 – and have money left over for saving and spending.
In San Francisco, local residents must earn at least $252,878 to live comfortably
The costs of many essentials have skyrocketed in the US in recent years, leaving households in dire straits
Although the rate of inflation has slowed since hitting a 40-year high of 9.1 percent in June 2022, it is still above the Federal Reserve’s target of 2 percent.
Annual inflation stood at 2.5 percent for August, according to the latest data – down from 2.9 percent in July.
But according to Labor Department data, food prices have risen 20 percent in the past five years.
Decades of high mortgage rates and record home prices mean that the average home loan payment this year is also double what it was in 2000.
But mortgage rates have fallen in recent weeks after a massive Fed rate cut last month, which could provide some respite for potential homebuyers.
The average 30-year mortgage rate is 6.12 percent, according to the latest Freddie Mac data as of Oct. 3.