I always said that a six-figure salary doesn’t mean much in Manhattan — it seems like everywhere I turn I run into 26-year-olds making at least $150k a year, or people younger than me buying $1.2 million apartments. (And yes, these are real example of my friends and acquaintances!)
According to the White House, the $250k salary is the mark of wealth in the U.S. However, it is obvious when taking into account cities like New York that $250k does not have the same effect in different parts of the country. CNNMoney has compiled a Google Map to show just that — in Manhattan, you would need to make $545k/year to maintain the same lifestyle as someone making $250k/year living in Missoula, Montana (where the cost of living index is exactly at 100).
Clicking through the red pointers (which marks cities whose cost of living are above average), it seems that Manhattan is the most expensive place to live in the U.S., and frankly I’m not surprised. The last time J and I went down to Baltimore, we marveled at the number of luxury, waterfront condos on sale in the $200k-$300k range and we couldn’t help but wonder if we made a mistake moving back up to NY.
How does you city compare to the rest of the nation? Are you surprised by the numbers?
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I am shocked at how "low" DC seems to be, in my opinion. While not at the NYC level, real estate here is tremendously expensive. My previous 690 square foot condo just sold for $415,000…. one bedroom, old style kitchen, no parking spot (extra $42,000 for the parking spot). And that’s considered a steal, since I’m not on a metro line. If I was, add on another $75k!
The included cities seem a little strange.. no St. Louis or Philadelphia, for example.
I live in Wyoming, which would seem to be a super cheap place to live. BUT, I live in a resort town. Most three bedroom houses start at 1.25 million. The condo we’re looking to rent (2 bedroom) is on the market for 400,000 at the moment. It’s ridiculous. Drive across Teton Pass to Idaho and you’re looking at the same 3 bedroom house for under 200,000. CRAZY.
I don’t think it is a question of relative lifestyle as much as a mark of where you shouldn’t be living paycheck to paycheck. It is always going to be expensive to live in NYC or downtown San Francisco than it is to live in less remote areas. For the same 300k you can get a giant McMansion in the middle of Texas.
With no other deductions, a single person would be taking home a little over $12,000 a month. Even in Manhattan, you can live on that (or have serious money management issues).
It’s crazy how much of the country is below average, probably because there are such outliers like New York. Otherwise, though, I’m not too surprised. Salary differences to make up costs of living are familiar to me because I telecommute. My office is in Philadelphia, and I live in Ohio. Whenever I’m tempted to look for a new, local, job, I know I’ll have to take a big pay cut.
Chicago was actually a little lower than I would have guessed. It feels expensive here but then it’s not nearly as bad as some places on the east coast. I will say that lately my husband and I have been dreaming about moving back to one of our hometowns, which are much much cheaper cost of living… we figured out that even if we sold our condo now, which would mean losing a decent amount of money because of the housing situation, we could still afford to buy a new house – with garage, yard, etc – and still have lower monthly payments than we do now! Of course, we’d also probably have lower salaries. but it’s nice to dream 🙂
This is why I like having friends in Manhattan to visit but not living there. I don't really understand why people choose NYC over other big cities unless they work a hedge fund or something.
And you can do a heck of a lot better than a McMansion in Texas for 300K. You can buy a condo in the heart of the city, or you can buy a single-family house in a fantastic neighborhood, like I did.
Saint Louis is on there. $225K to have a 250K lifestyle. I have to admit, it's a cheap place to live and the buying power is great. I may not make 150K a year, but my salary goes really far here! I grew up in California, so I'm familiar with cost of living issues, har har. Every time i think about living in a big, nice city, I think about how I could probably barely afford rent =]
I live in Colorado Springs and I'm not surprised. The state of Colorado in general is growing by leaps and bounds due to retired military coming here and also it seems that more and more people are moving from CA and TX….and unfortunately they don't understand that four-wheel drive does not mean four-wheel stop on snow and ice! 😉 I grew up in KS, not on a farm or anything, but totally different here but I like it and I'd never live back in KS—nope, never.
But $250K in Jersey goes a little bit further than in Manhattan, no?
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Even if the cost of living in other places is a lot lower, it doesn't matter if there are very few jobs there that pay in the 6-figures. You might be able to move in Missoula, Montana, as a doctor, and make a nice living, and live like a king, but there are very few high paying tech and finance jobs out there. Or you might be able to live like a king in Michigan, but good luck finding a job there where you'll get a nice salary (if you can get a job there at all, since the state employment rate is 13.1%).
Places like NYC and SF have a high cost of living because there are tons of good paying jobs in these regions. The well-playing jobs are clustered together in these areas. There are a handful of big cities with a good jobs market and lower cost of living (Houston, Dallas, Atlanta, and Chicago always come to mind), but even these places tend to pay a little bit less to reflect the lower cost of living.