Austin, Texas – The city of Austin is experiencing a surge in the cost of living along with inflation, making it increasingly taxing for Austinites to sustain a comfortable lifestyle. According to a recent analysis by SmartAsset, Austin tops the chart with one the highest salaries required to live comfortably in 2024 among the major US cities.
The analysis by SmartAsset adopted the 50/30/20 budgeting rule to deduce the amount of money required to live sustainably in Austin. According to this rule, 50 percent of a person’s salary should go towards needs (housing, groceries, transportation), 30 percent towards wants (entertainment and hobbies), and the remaining 20 percent to pay off debts, saving, or investing. Consequently, a single adult living in Austin would need to earn an annual income of $99,757, which breaks down to an hourly wage of $44.12 to avoid living paycheck to paycheck. Additionally, for an Austin-based family of four (two adults and two children), the required combined income to comfortably meet lifestyle costs is $223,891.
Data used in the SmartAsset study was derived from MIT’s Living Wage Calculator. Under the 50/30/20 strategy, with SmartAsset’s stipulated income, an individual Austin adult would need to allocate $49,878.50 of their salary to living expenses, $29,927.10 for discretionary spend, and $19,951.40 towards savings or debt payments. Meanwhile, families of four need to invest $111,945.50 on living costs, allocate $67,167.30 on entertainment and hobbies, and put $44,778.20 into savings or debt retrieval.
With these projections, the required income to live in Austin surpasses the national average by $3,257 for singles. However, Austin families fair better than the national average of $235,000 per annum.
Among all Texas cities, Austin has the highest necessary income for a financially stable life. In contrast, Houston, ranking as the US city with the lowest annual living wage, requires an annual income of $75,088 or a hourly wage of $36.10. For a family of four, the combined income requirement is $175,219.
Not surprisingly, New York City tops the list as the city requiring the highest salary to live comfortably. Single adults need to earn an hourly wage of $66.62 or an annual salary of $138,570 to afford a comfortable lifestyle without living paycheck to paycheck. A family of four in the city requires a combined annual income of $318,406.
For more detailed insights into the cost of living across US cities, view the full SmartAsset report here.
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