Here's the Salary Needed to Live in the 12 Most Expensive U.S. Metro Areas

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Inflation has wreaked havoc on Americans’ budgets, unsettling their feeling of financial stability and making it increasingly difficult to live comfortably in the largest U.S. cities, according to a new report from SmartAsset.

“A budget is the bedrock of many people’s financial plans,” Susannah Snider, SmartAsset’s managing editor of financial education, said in a statement. “And it’s especially essential to understand and track your spending when the cost of everyday items is rising.”

Averaging 8% in 2022, inflation has affected everything from the price of eggs to the cost of housing. Wage growth has not kept pace, with salaries increasing by 5.1% between December 2021 and December 2022.

Against this backdrop, SmartAsset calculated how much after-tax income is needed to live comfortably in the country’s 25 biggest metropolitan areas, using the most recent MIT Living Wage Calculator data to gather the basic cost of living for a person with no children in each metro area as of 2022.

The online tool calculates the cost of living by adding the average cost of housing, food, transportation, medical care and other expenses within each metro area.

Researchers assumed that the MIT cost-of-living figure for each metro area would cover needs — 50% of one’s budget — and then calculated the total take-home pay that enables individuals to spend an additional 30% on wants and 20% on savings or debt payments.

“Being able to stick to a 50/30/20 budget means you have enough to fund short- and long-term goals while paying for essential living expenses,” Snider said.