Tue 10 Feb 2009 – 13.39
In the continuing saga of New York being ridiculously expensive, The Daily News this week runs the numbers of how much money it actually takes to live in New York. Apparently, the magic number to be considered middle class is $123,000!
There’s a ton of doubt to be seeded into these numbers, as well as to their comparative power. For example, that $123k in New York will afford you a similar lifestyle to a measly $50,000 in Houston, TX. Really?
A New Yorker would have to make $123,322 a year to have the same standard of living as someone making $50,000 in Houston. In Manhattan, a $60,000 salary is equivalent to someone making $26,092 in Atlanta. You knew it was expensive to live in Manhattan, but Queens? The report tagged Queens the fifth most expensive urban area in the country. The average monthly rent in New York is $2,801, 53% higher than San Francisco, the second most expensive city in the country.
Check out the article for more shocking and depressing stats. »
Naturally, this forces us to challenge what it means to be Middle Class, and what kind of lifestyle you deem necessary. Along similar lines, I just watched a lecture from Elizabeth Warren entitled “The Coming Collapse of the Middle Class”. It’s lengthy, but informative. And equally depressing. This is the sort of thing that makes you think twice about what sort of career you want to pursue, how many kids you want to bear and where you want to live. Maybe that SUV with rims isn’t so important after all.
This comes amid scandal about how many fancy finance professionals are complaining that they can’t survive on President Obama’s proposed $500,000/year capped salary. The New York Times tells the tale of how families will feel the pinch, and how that salary doesn’t allow for their normal affluent lifestyle including a full-time nanny and private school tuition that would make Harvard admins blush.
Not every bank executive has school-age children, but for those who do, offspring can be expensive. In addition to paying tuition, “You’re not going to get through private school without tutoring a kid,” said Sandy Bass, the editor of Private School Insider, a newsletter that covers private schools in the New York City area. One hour of tutoring once a week is $125. “That’s the low end,” she said. “The higher end is 150, 175.” SAT tutors are about $250 an hour. Total cost for 30 weeks of regular tutoring: $3,750. Two children in private school: $64,000. Nanny: $45,000.
So while you’re scratching to make a dollar out of 15 cents, shed a tear for the über-wealthy who might have to take the subway or pack a lunch or raise their own children for a change.
posted by Scott in careers, personal finance.