According to a new study cited by the San Francisco Chronicle, a family of 4 needs to make $77,069 in order to “get by” in San Francisco.
From SFGate:
A family of four in the Bay Area with two working adults must earn $77,069, equaling an hourly wage of $18.53, just to pay for basic necessities, a study released today calculates. If only one adult works, that figure falls to $53,075, largely because the family doesn’t have to pay for child care, according to the report by the California Budget Project, a liberal Sacramento research group. But that one wage-earner must make $25.52 an hour.
And a single parent with two children needs to take in $65,864 annually, at an hourly wage of $31.67, to cover expenses, the Budget Project figures.
Statewide, the two-working-parent family needs an annual income of $72,343 to cover necessities; the family with one working adult must earn $50,383.
…
They estimated prices of housing, child care, transportation, food, health care, taxes and miscellaneous, a category that lumps together everything else. They looked at rental costs rather than home ownership and made certain other assumptions that have big effects on living standards.For example, they included as a necessity individually purchased health insurance, although many families are covered at least partly through work. And, in an effort to figure what it takes to support a family without public assistance, they didn’t consider the help many families get from government benefits such as housing and child health care subsidies.
According to those assumptions, the biggest expense was rent, estimated at an average of $1,312 for a family of four in the Bay Area, higher than the statewide estimate of $1,160. Child care was the second biggest outlay at about $1,216, followed by taxes and health coverage.
It sounds like more of a “worst case scenario” than “everyone with 2 kids absolutely needs this much money,” but even so it’s interesting. We suppose the title of this post could also be, “San Francisco Laughs At Your Measly $77k.”
Hey Bay Area readers, do these estimates sound correct to you?
A Bay Area couple with two kids can’t make it on $50,000 a year [SF Gate]
(Photo:Maulliegh)
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This hypothetical family of four would have to be living in an SRO (i.e. a hotel room in a building that’s one step above a homeless shelter).
Oye. 4 Kids, Wife (doesn’t work) on $55k/year in Western New York. Have health, dental etc. for all. Own a nice 3 Bedroom home in Suburbs. Three cars. We have all that we need, not all that we want. Great job that I love.
Had lived in SF/Bay area 5 years ago and could not imagine having any of this if I had stayed making over twice as much.
I love the Bay Area, but it seems a much better place to visit than to live. I honestly don’t know how people do it out there.
And yet somehow GOP is trying to argue that child health care costs shouldn’t take into account the high costs in urban life. hmm…
That seems kinda low. Unless house prices are lower there. Here on long Island for something small I would still pay $1400 a month for a mortgage for something small. Thats not including the taxes and insurance.
I make $53k a year and can only afford to live in a 2 bedroom condo here.
If it really is that cheap to live in san fransisco then I should move to california.
“Get by?”…My depression era grandparents think that you do not know what those words mean.
@backbroken: Haha that is so true! I’m quite sure your grandparents ‘got by’ on a mere $77
@Woofer00:
Simple solution: move. Federal tax dollars shouldn’t fund one’s choice to live in an area with an absurd cost of living.
Add 20 grand and thats the correct rate for suburban Northern Virginia. Unless you’re lucky enough to qualify for income restricted housing (no, it’s not section 8 housing) it’s pretty much impossible to do it on less than that. I’m moderately amused that it’s about the same cost on opposite coasts.
@Mark 2000: You can barely find a one-bedroom in gentrified Brooklyn for less than $2k. Rental Prices have sky-rocketed in the last couple years. I found out the hard way when I started looking for a new place a couple months ago.
I have a lot of good friends in San Francisco and I know $77k is WAY TOO LOW for a family of four. A $1300 2-bedroom is a pipedream and probably not big enough for four people to begin with.
We’re in brooklyn, NY. Our rent is 2400 for a big apartment (by NYC standards). We have two kids. One is 15 months, the other is 2 weeks old. My wife is not currently working (layed off suspiciously close to her due date), and is in the process of starting up a home business. Health and dental costs for everyone are covered by my job.
Until the 2nd child came, our retirement was ‘on-track’, but we stopped everything until my wife is earning income again (though she’s temporarily getting unemployment – net 1600/month). I’m bringing home net 3800/month. I started (slowly) saving for a downpayment two years ago, but we’re nowhere near anything and I’ve paused that too. We’re both 31.
Child care costs have been extremely fortune for us – we found someone who’s fine with taking $12/hr to (eventually) watch two children. The going rate for one child is $12-15/hr, and two children is $15-20/hr (around $1900/month). Daycare at a place you might consider, at the cheapest, is 1200/month. (There is talk of a Chinatown place for $900 – Mandarin lessons free of charge!) You only get a 10% discount for the 2nd child in most places, so a babysitter’s costs scale up better than daycare. And that’s aside from not having to add at least an hour to your daily commute in kid-prep and transport to daycare facility.
We live ok, but still paycheck to paycheck and with a certain level of tension. We don’t really have an emergency fund, college savings, or HBO. We don’t go on vacations. We don’t have any cars. We go out to the diner for breakfast once a week, and maybe once a month to a restaurant. We cashed out 8k of pension fund rollover to cover us as a cushion for this time my wife is spending nursing our newborn. It’s not being eaten away quickly, but it will probably be gone in 5 months. Our insurance is ok, but there are still baby costs.
BTW, our newborn caught a cold. Because of her age, they had to pretend it was meningitis. We spent three days and two nights at NYU Hospital. (she is fine.) Lovely people, great place. Cigna got billed almost 8 grand for that stay. The birth cost 4K (easy, no complications). The prenatal visits and care were around 8K. (Mom had gestational diabetes.)
A normal pediatric check-up for my older kid cost $150. We were there for 20 minutes. Good doctor, for what it’s worth.
Rents when we moved in 5 years ago were 1500-1750 for a 2-bedroom. Now, they’re 1900-2400. And our neighborhood is bordered to the north and east by public housing. It’s safe enough, and most of the people are amazing. But there’s definitely some tension floating around as long-time neighborhood renters see their neighbors slowly get squeezed out only to be replaced by ‘rich’ people. Houses in our neighborhood range between 1.4 to 3.1. Co-ops at a slightly-rundown building start around 400K for a 1-bedroom, while a 2-bedroom condo around the corner is 1.1. A new building just went up down the road. It’s 20-something stories, and the cheapest apartment in it is 990K. I don’t even want to know the maintenance fees.
I appreciate that everyone’s offering examples of what things cost in their area. We really need a database of costs, especially medical ones.
We moved from Chicago to Alamo, CA (East Bay) in 2004. We were shocked by the cost of living and routinely wonder how people make it. I’m a lawyer and my wife is a doctor, so we’re far from scraping by, but you can’t find a fixer-upper in our town for less than $850,000 (with most houses going for seven figures), and the surrounding areas start at no less than $500,000. Add in the costs of education (six figure student loans) and transportation (Bay Area = a lot of driving), child care (decent starts at $900 but doesn’t go much bove $1,400 per child), Health Care (employment coevered health care is a fanatasy these days and will shortly be a total fiction) and any hope of saving for reitriment, and you’ve burnt through more money than most people will make.
Not everyone has two professional incomes coming in, so I’m not sure how people are paying for their lives. I realize that there are places to save (i.e., cars, food, furniture, scratch any travel plans), but my guess (based on our consumer culture)is that the item most people are cutting out is retirement savings. As a nation, with California leading the pack, we are heading for a massive crisis when generation X hits retirement age with no retirment savings or benefits. Everyone thinks that the baby-boomers are going to suck up resources, but wait until you have an entire generation of people with nothing in the bank.
This will not end well.
@mikala: Same here- SO and I make about the same, in Fremont. Our kids are doubled up in their rooms, and both my cars are secondhand. Most goes into the house payment- and my house is definitely in the “fixer-upper” category, even though it’s currently worth 3/4 of a million. We figure after the ARM slide, we can sell and buy a house on the east coast outright with the equity.
@Caswell: That’s where the jobs are.
Fascinating stories!
I’m single and pulling in about 70k in a sales job (should be more but I’m working for a very small tier 3 software company with poor management) and I barely get by. I live in the SF ‘burbs in a small 1 bedroom apartment paying $1250/month rent (hasn’t changed in about 4 years). My car is 6 years old and paid off. Auto & renters insurance is nearly $1000 a year. Utilities are about $150/month (cable, telephone, internet, electric). Health club is $78/month. Food & groceries are about $250/month. Car expenses average $80/month (gas/oil, repairs). I pay off all my credit bills each month, donate a little cash to charity now and then and clothes and stuff to Goodwill at year end. Haven’t taken a vacation in quite a long time. Waste nearly $100/month on lottery tickets (I know, poor math but it’s what many do when you feel desperate and don’t see any easy way out of your situation).
Overall, I have about 4-5 months expenses saved in cash, no debt and about $75k in a retirement IRA. So I guess I am [relatively] better off than a lot of other people.
@ FAIT ACCOMPLI – “Everyone thinks that the baby-boomers are going to suck up resources, but wait until you have an entire generation of people with nothing in the bank.”
Too true. Even more so when/if there aren’t any jobs for retiree’s and their houses are worth 50% less than now. Revolution anyone?
i think the secret is to get in to the childcare business. $900 dollars per kid min. sounds like you make the big bucks lets be honest. I have grown up in the s.f. bay area and am looking for a job to support myself
right now. I know i need at least 40K for a single person so how the hell a family is making it on 80K (give or take) I have no clue.
rent, estimated at an average of $1,312 for a family of four in the Bay Area
that seems terribly low. 3 bedroom house or apt is going to run about $1800-2100 in any Bay Area neighborhood worth a damn.
This is spot-on, we moved to IL because we were about to become a four person family and with almost these same earnings numbers. It was going to be incredibly difficult to make ends meet in Sunnyvale.
I don’t get the impression that the owners or the people working for my childcare center are making much money, and we give them over $1000/mo for one kid. In fact, the best place in town is run by the university, is non-profit, gets most of their workers from the school of education, and they charge $1200/mo. And this is Ann Arbor, not some heinously expensive coastal city.
In-home daycare (ie, not a big center) is vastly cheaper, but doesn’t have the oversight that the larger places do, often have TVs going all the time, and don’t necessarily have the 1-4 caretaker-to-child ratio that ours does.
I try to ignore the fact that I *could* be driving around in a new Porsche rather than my 10 year old VW, but whatevs…baby’s probably more fun in the long run and depreciates in value a lot less. Still, makes you consider packing up and moving to France or Canada or somethin’.