Dive Brief:
- In 25 of the largest U.S. metros, a $100,000 household salary won’t stretch far enough to cover the basic expenses for a family of three, according to a recent report by Lending Tree, an online lending marketplace.
- In San Jose, for example, a family of three would be an estimated $2,207 in the red each month after paying for basic expenses, making the area the least affordable, the report found.
- The report highlights how Americans might need a mindset shift when it comes to that “magic number” salary that ensures financial stability, the authors wrote. Had the authors’ calculations for basic expenses for things like housing, child care and transportation factored in debt payments, “the number of metros in which six-figure earners are still broke would be far larger,” they noted.
Dive Insight:
“For generations of Americans, $100,000 has long been a magic number. It has been seen as a level of yearly earnings that says: ‘You’ve made it. You’re successful,’” the authors wrote. “For some people in some locations, $100,000 is still magical today. However, that has changed dramatically in many of the nation’s biggest metros.”
The median household income in the U.S. climbed to $80,610 in 2023, according to the most recent U.S. Census Bureau data, up from $68,220 10 years earlier.
The gap between workers’ wages and the rising cost of living is causing real concern, as 73% of workers said they struggle to afford beyond their basic living expenses, and 12% said they can’t always afford their basic living expenses, a Resume Now report from January found.
And, in a separate report by Zety released in February, half of the workers surveyed said they don’t feel able to start a family or grow theirs on their current salary, and 40% said they aren’t able to save for retirement.