$235k for family of 4 to live comfortably in top 100 biggest cities!

[chris0699]

Anyone else see this article from a few weeks ago? Basically, on average, in the biggest 100 cities in the United States a family of 4 requires a household income of around $235k for 2 working adults and 2 children to live comfortably - Salary Needed to Live Comfortably – 2024 Study | SmartAsset

The latest FED data I can find shows a median family income of $93k for a family in 2022 - Median Family Income in the United States (MEFAINUSA646N) | FRED | St. Louis Fed (stlouisfed.org)

Now that $235k probably includes 2 in daycare, college savings put away for kids, a vacation or 2 a year, retirement savings for the parents, 2 car payments, student debt and buying a home in the last couple years with an inflated price and high interest rate but jeez, even cutting as much out of the budget as possible, how are families supposed to make it? $235k is 2 jobs at $117.5k each and other than in the VHCOL of living areas (which often require $300k+ family income in the article) jobs like that are not real easy to come by much less two of them.

I come from a POV of being in that family of 4 and last year we grossed a little over $200k combined in a MCOL area and we are comfortable but we also have owned a home for 10 years, only 1 in daycare, no car payments for 4 years, etc.

Besides people just drowning in debt to survive if they make less than say $150k combined for a family of 4, what am I missing here?

 

[merleharlin]

@chris0699 This says you need $83k to live comfortably as a single adult and over $200k for a family of 4 in OKLAHOMA CITY.

That’s so incredibly stupid that it invalidates everything else they could possibly say.

 

[prd94]

@merleharlin Part of this is just the problem with the methodology. The MIT living wage calculator assumes you spend more on transportation than housing in Oklahoma city. For Oklahoma city it assumes 1 adult with 0 children spends $9800 per year on housing but $10,996 on transportation. And then from there, smart asset assumes all the expenses reported in the MIT living wage (including the $2100 spent on "civic") is 50%. So if MIT says your expenses are $41,321 to be a single adult in Oklahoma city, then to live comfortably you need to double that.

 

[phil4508]

@prd94 Glad to hear I'm not the only one who found it odd that transportation expenses were higher than housing. I don't think that's ever been close to being true for me. My housing costs are about 3x my transportation costs right now.

 

[prd94]

@phil4508 It also assumes the transportation costs in Oklahoma city are similar to that of Seattle. Which.. as a Seattle resident I highly doubt.

 

[spread_the_gospel_online]

@prd94 As an Oklahoma city Resident, my transportation costs are around 5k for gas (I average 40k miles a year) 1k for insurance and 800 for maintenance. My costs are super weird though.

The average car note is over 500 a month and you absolutely have to have a car here. So not far off?

https://finance.yahoo.com/news/average-auto-loan-payments-expect-174817148.html

 

[prd94]

@spread_the_gospel_online You seem like an outlier, though. 40k a year is really high. But my point is that gas here in Seattle is higher. Average gas is about $3/gallon in Oklahoma city, and $4.69 in Seattle.

It could be argued people have to drive further whenever they need to move around in Oklahoma city, which it sounds like your comment of everyone needing a car supports. Which is an interesting cost of living data point.

And also brings up an interesting point for which areas should invest more in EV infrastructure.

 

[eliasjohn]

@phil4508 I guess with 4 cars and gas factored in it could be more that what I pay in a mortgage.

 

[phil4508]

@eliasjohn lol, maybe they managed to get such a high number because the MIT study is simultaneously assuming you need to be paying for both daycare and cars for your two kids at the same time.

 

[eliasjohn]

@phil4508 The cars my kids are using are just hand me downs from 2012. So just gas and oil change really.

 

[sparrow7]

@eliasjohn insurance...

 

[unrelentingfortruth]

@merleharlin Well this nonsense article breaks down to an assumption that “living comfortably” would allocate that 235k/yr as a hyper-realistic for the top 100 cities in America:

-$9800/mo for housing, groceries and transportation
-$5875/mo for entertainment and hobbies
-$3820/mo savings and investment

 

[busmcgusterblus]

@unrelentingfortruth lol WHAT nope

 

[restorationlight]

@unrelentingfortruth My house hold is close to that.

. Around me, 9k a month is far closer to 1.5 million for a house. $1500 a month in savings equats to about 2 million in retirement. $4k a month in savings is about 5-6 million in savings with a 401k without a match.

Assuming minor appreciation of the house and savings after the kids move out and the house paid off, that's like a 8-10 million dollar net worth by retirement.

The top 1% habe a networth of 11 million.

These articles are such BS

 

[nj123]

@unrelentingfortruth 235k a year doesn’t get you 19k or whatever a month. We make more than this gross, but take home is between 11k and 12k. Taxes, healthcare care, and retirement contributions take about 40%

 

[rachelisunique]

@merleharlin It’s a super unhelpful article. Almost all of their methodology is hidden behind “we used MIT’s cost of living calculator”.

They also mention the 50/30/20 rule. If they were really incredibly dumb, they looked up “cost of living”, defined that as what 50% of your income is, and therefore assumed everyone should make double that.

 

[phil4508]

@rachelisunique That’s exactly what they did for this “study.” They took MIT’s numbers and multiplied by 2.

 

[ubicaritas]

@merleharlin I live in a city that has several multiples the population of Oklahoma City. Our household income is $115k (4 people) and we are perfectly comfortable.

This article is absolutely ridiculous.

 

[outofthedesert]

@merleharlin Clearly not true. I live in a suburb of Tulsa (a top 60 city in the US by population). Family of 4 making just under $100K HHI. We’re not rich, but we’re comfortable.

Here in OK, anything from my salary of $100K to $150K for a family of 4 you’re going to be able to live comfortably. $150K+ here = you’re rich.

 

[saskia]

@outofthedesert South Carolina here HHI over 150k you are rich. Were 185k and my neighbors are north of me in my new build community. Everyone is extremely comfortable my family of 4 included. Inflation is annoying but just that, an annoyance.