A recent analysis by SmartAsset reveals that a family of four needs to make more than $275,000 to live comfortably in some of the most expensive U.S. cities. “Comfortable” is defined as the income needed to cover a 50/30/20 budget for a family of two adults and two kids. This budget assumes that 50% of the monthly income can pay for necessities like housing and utility costs, 30% can cover discretionary spending, and 20% can be set aside for savings or investments. The income needed for this budget was calculated based on the cost of necessities using data from the MIT Living Wage Calculator.
The top 20 most expensive cities in the U.S. for a family of four to live comfortably include San Francisco, San Jose, Boston, Arlington, New York City, Oakland, Honolulu, Irvine, Santa Ana, Portland, San Diego, Chula Vista, Newark, Jersey City, Seattle, Aurora, Long Beach, Anaheim, Los Angeles, and Washington, D.C. San Francisco tops the list with an income of $339,123 needed for a family of four, followed closely by other cities known for high housing costs.
California stands out as having especially expensive housing, with homes about twice as expensive as the typical U.S. home. The state also ranks fourth-highest in cost of living based on 2023 survey data. Across all 99 cities examined by SmartAsset, a family of four would need a median income of $226,886 to live comfortably. Houston offers the lowest income requirement at $175,219, still higher than the median family income in the U.S. of $92,750 according to the U.S. Census Bureau.
High-cost cities tend to offer higher-than-average salaries to attract and retain talent, but housing costs can make it difficult to maintain a 50/30/20 budget. In large cities, housing costs often exceed 30% of household income, leaving little room for other necessities like utilities, food, and transportation. This can lead families to forgo homeownership, vehicle ownership, and discretionary purchases to make ends meet.
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