California is home to seven of the top 10 cities in the nation where residents have to earn the highest salaries to live comfortably, according to the latest study by SmartAsset, an online financial information company.
The cities are San Jose, Irvine, Santa Ana, San Diego, Chula Vista, San Francisco, and Oakland, the company found.
“While cost of living premiums and inflation metrics capture the price increase in goods and services, they do not necessarily account for all the additional costs needed to live comfortably—such as a buffer from the stress of living paycheck to paycheck,” Jaclyn DeJohn of SmartAsset wrote in a summary of the findings March 7.
The company recommends that for a comfortable lifestyle, people should spend 50 percent of their salary on basic needs, such as housing, groceries, and transportation. Another 30 percent should be allocated to “wants” like entertainment and hobbies, while another 20 percent should go to paying off debt, saving, or investing.
Singles living in New York City need to earn the most money in the U.S. to live comfortably, the research revealed. According to the study, residents living alone in the Big Apple needed $66.62 per hour, or an annual salary of $138,570 to live comfortably.
To just cover necessities, they would have to earn $70,000 in wages each year, the study found.
San Jose placed second behind New York City in the top 10. Residents in the tech hub need to earn $136,739 each year to live in comfort. In third place was Irvine, where singles need $126,797. In Santa Ana, which was fourth on the list, $126,797 annually is needed.
Multiple homes with solar panels are shown in Scripps Ranch, San Diego, on Oct. 5, 2016. (Mike Blake/Reuters)
Sixth on the list was San Diego, where single residents need $122,803 per year to live in comfort. The city tied with neighboring Chula Vista.
San Francisco ranked eighth, requiring $119,558 a year for singles to live in comfort and Oakland placed 10th, needing $118,768.
Families Cost More
Households with two adults and two children required even more, according to the study.
The minimum income for a family of four increases to $300,000 per year in six cities. Those cities and needs are: San Francisco, $339,123; San Jose, $334,547; Boston, $319,738; Arlington, Virginia, $318,573; New York City, $318,405; and Oakland, California, $316,243, according to SmartAsset.
Living With Less
Texas is the state for those who want to live comfortably for less. The Lone Star State was home to four of the top 10 such cities, according to SmartAsset.
The city where residents required the lowest salaries was Houston, Texas, where singles needed to earn $75,088 each year, and a household with two adults and two children needed $175,219 annually, according to the study.
El Paso came in second. Residents in the southern Texas city only needed an annual salary of $75,254, while a household of four needed $180,461.
In third was Lubbock, where a single adult needed $75,379 and a family of four $180,461. And Laredo placed fifth, with $78,458 needed annually for single adults, and a four-person household required $179,046, according to the study.
National Average
A single person living in a major United States city needs to make a minimum of $96,500 a year, on average, to live in comfort, the study found. This includes being able to pay off debt and make investments for the future.
Such is higher for families with children. SmartAsset estimates a household with two parents and two children need to earn a combined minimum of $235,000 each year to live comfortably.
