How much does it cost to live in New York? Well, most people would say a lot! But over 8 million people live in New York City and not everyone is living the celebrity lifestyle. So how does the average person afford to live in one of the most expensive cities in the world?
In short, they make compromises. You can’t have the nicer apartment with the higher rent and go out to eat at the best restaurants all the time. Figure out what to prioritize in your life. Is it living space, food, experiences?
To get started, let’s look at a sample budget. This will help you determine what salary is needed to live in NYC. Let’s look at this example for a new college graduate who’s simply looking to stay afloat in a big city.
Based on this example, the cost of living in New York for the expenses above without student loans would be $33,850 per year. But don’t forget, this is just the regular expenses. You need to make enough to have this amount after taxes. However, this is doable, but doesn’t leave much room for savings.
If you make some adjustments, like adding a roommate, packing lunches or skipping vacations, and depending on how much comfort you’re willing to sacrifice, you might even be able to find some meaningful monthly savings. Nonetheless, it’s a very tight budget, which offers little margin for error. One large unexpected expense or an abrupt change in employment status could have you packing your bags.
Just know that the salary needed to live in NYC may be more than you could realistically make at a first job out of college in certain fields. And again, please don’t forget taxes. Unlike most of the country, if you live in NYC, then you will pay both state and federal taxes in addition to a city tax. You would think with all the taxes public transit would be better? Nope. The MTA is terrible. Get used to it.
This begs the question, is the cost of living in Manhattan even worth it? Well, that depends. For those who know exactly what they want and have the determination to get after their “great things in life,” the opportunities found in a big city may be too good to pass up. Living lean and being slightly uncomfortable might go a long way in ensuring your survival. But for those lacking direction, discipline and purpose, it’s likely going to be a financial experiment you’re going to regret.
Here is some unsolicited advice: Think about what it is you want for yourself. If you’re unsure, think twice before rushing to places like New York City, which are unforgiving (in more ways than one). At the very least, budget everything out prior to committing yourself to financial obligations like expensive rent. Knowing the average cost of living in New York can help you take a step in the right direction.