A study by SmartAsset, the site that helps people make financial decisions, looked at the after-tax income needed to live comfortably in the 25 largest metropolitan areas in the country.
To determine how much money is needed, the site used the 50/30/20 rule to define a comfortable lifestyle. This rule is a budgeting strategy that allocates 50% of after-tax income to basic living expenses (needs), 30% to discretionary spending (wants), and 20% to savings or debt payments.
“Being able to stick to a 50/30/20 budget means that have enough to finance short- and long-term goals while paying for essential living expensessays Susannah Snider, a certified financial planner and managing editor of financial education at SmartAsset.
The study found that the average after-tax income needed for a comfortable lifestyle in the 25 metropolitan areas is $68,499.
where the metropolitan area of St. Louis turned out to be the most affordable location requiring $57,446 dollars after taxes to live comfortably.
In counterpart, the San Francisco Bay Area, requires the highest take-home pay, at more than $84,000 to maintain a comfortable lifestyle.
The 5 places that require the lowest salaries are:
1. St.Louis, MO-IL
Median after-tax income: $57,446, the least amount of money in the 25 metropolitan areas. This covers basic living expenses ($28,723), with enough left over to dedicate 30% to necessities ($17,234) and another 20% to savings or debt payments ($11,489).
2. Detroit-Warren-Dearborn, MI
A single person needs to earn $58,358 after taxes to live comfortably in the Detroit-Warren-Dearborn metropolitan area. With basic living expenses of $29,179 per year; $17,507 for discretionary spending and $11,672 for savings or debt payments.
3. San Antonio-New Braunfels, TX
Here a single person must earn $59,270 after taxes. Typical living expenses add up to $29,635 per year, which means that a person living comfortably would have $17,781 for discretionary spending and another $11,854 for savings or debt.
4. Philadelphia-Camden-Wilmington, PA-NJ-DE-MD
In this area a single person needs at least $61,678 each year to live comfortably. Where $30,839 per year is for typical expenses; $18,503 for other needs; and would have $12,336 left over for debts.
5. Charlotte-Concord-Gastonia, NC-SC
A single person can live comfortably in the metropolitan area of Charlotte-Concord-Gastonia in the Carolinas for $62,110. Allocating for living expenses $31,055 per year; $18,633 for discretionary spending and $12,422 for debt repayment.
For more details about the study, click here.
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