this post was submitted on 14 Jun 2025
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SmartAsset’s calculations for cost of living in 2025 are based on a healthy financial breakdown of 50/30/20 for expenses, discretionary, and savings percentages. Which is a level of fiscal security everyone should be entitled to IMO
Their cost of living calculations are not based on “what is the bare minimum one can survive on” where your percentages look more like 66/33/0 or 90/10/0
Really the larger thing these maps show is how all of the money has been drained away from working people over the past 70+ years. The cost of everything has accelerated, for example $35 an hour is about the amount one must make to afford the median rent or median mortgage prices in 2025, but we get screwed out of the value that our labor creates as it gets siphoned upwards. Most Americans survive on credit, which they wouldnt have to do if wages had kept up with inflation the same way that rent did since an era before neoliberal economic policy wrecked everything. If they had, then people would be making about $35 an hour. Considering we produce such massive value with our labor, it makes perfect sense. But allowing wages to stagnate is obviously beneficial to those with concentrated wealth, be it companies or individuals
I don't think everyone is entitled to wealth accumulation. Housing/health/food security, absolutely, but being able to build wealth by making enough to save 20% of your earnings is beyond a basic entitlement. I doubt most people would agree with you on that.
You could more accurately title this as "Minimum wage needed to live like an average boomer in 1975". Still fucked up, and not misleading.
Edit: you added a bunch to your reply. I think the framing of this is just wrong, frankly. Wages absolutely have not kept up with the cost of living, but you're going beyond that and saying everyone is entitled to the financial security of a middle-class earner. It's a good goal, but not an entitlement, and no reasonable person would frame that as a minimum cost of living.
The 20% is not “wealth accumulation”, it is literally just for emergency expense planning and for retirement savings, and debt payments.
I encourage you to read SmartAsset’s explanation for their calculations. I’m not the one doing any of those calculations, Im using them as a source, while they themselves are in part relying on MIT. Nothing of what I have produced is misleading
Saving 20% of your income is way beyond emergency funds and what is needed for retirement. Typical guidelines for emergency funds are to set aside at least 6 months worth of living expenses, you don't need to save 20% forever. If you saved even 10-15% of your income for retirement your entire life, you'd have a very comfortable retirement (assuming the world doesn't burn down before then).
SmartAsset is a financial advisor service, and these numbers seem to be guidelines for middle-class earners. That's pretty far beyond a minimum cost of living, so I'd say this title is misleading at best.
6 months worth of living expenses in 2025 is gonna be, median, $10k in rent/mortgage payments alone. That in and of itself is like 14% of someones annual income at $35 an hour.
Then you have emergency repairs to a vehicle, plus maybe a home. You assumedly would want to have 6 months coverage for insurance too, no? Plus a fund of money for food, if we’re hypothesizing this is a 6 month fund for a time when you cannot work or otherwise arent making money. So by now were probably talking 17+% of an annual income and we havent even put anything away for retirement yet in the first year.
I truly fail to see how 20% saved annually isnt something reasonable, considering the need for different draws out of some of it will come sporadically, while you also need to be saving for your retirement in some inevitably inflated future where everything is even more ridiculously expensive than it is now.
People today are buying groceries with Klarna, and were saying nobody needs to be saving money at a good rate? How many people would be subsisting on ridiculous levels of credit right now if they had been paid well enough to put away 20% of a reasonable wage if they wanted to for several years
Why the fuck should people have to live in a “one bad move, or illness, or whatever and youre fucked” economy? Especially one that criminalizes homelessness, throws people in jail, and then abuses them as legitimate slave labor by paying them less than what was considered an appropriate wage for a 9 year old child laborer in the 50s
We live in the wealthiest society in the world, and people dont deserve to live comfortably?
The first describes a total emergency fund of 14% annual income that would provide 6 months rent. The second describes annual contributions of 20%, which seems like it provides 6 months living expenses for every year worked. That's an awesome goal, and kudos to anyone who can do it. I did. It let me retire at 45, which is several steps beyond "living comfortably."
I think youre misunderstanding that I am referring to the same 20% the entire time. Yes, two different destinations for money in savings (emergency and retirement separately). Their calculations also assume that that 20% is also going towards paying down any debts. My response to him in particular was pointing out that you wouldnt be able to fully fund an emergency account within 1 year and pay down debt and save for retirement. Whereas his point was 20% is a ridiculous amount. I think if you ignore the debt part maybe that would be slightly more reasonable, but even still, if you cant do it in 1 year on $35 an hour how the fuck is anyone gonna do anything remotely close to it at 1/4th or 1/5th of that? They wont. And in reality, by the numbers, even at $35 an hour no one could afford to live at 50/30/20. AKA living truly comfortably and without being in a financially precarious position, which it should be obvious involves having a healthy amount of savings and also not having to work yourself to death after retirement age
The reason I made these isnt even to argue for a certain wage of any kind. The point is to see just how far off all working class Americans are from any level of comfort. Where did all the money go, if people were being paid the equivalent of $35 an hour today 75 years ago? Its no surprise we are all fucked outside of a handful of people
I feel like you're conflating assets and income. Paying down debts is not saving. Paying down debt could be a mandatory expense, like mortgage, or it could be discretionary, like paying off credit debt accumulated on that European vacation, but it's not saving. An emergency fund is a thing you have, not a revolving account that you spend every year and re-accumulate. It can take a few years to accumulate, because you only sacrifice it for emergencies - not a car repair you've been putting off. The only difference between an emergency fund and retirement savings is that the government punishes you for spending designated retirement savings.
But by choosing 'comfortable' as a reference, titling the post 'cost of living,' and comparing it to the minimum wage, you open yourself to exactly this criticism. To appearing to make a bad faith argument by exaggerating the 'cost of living' by including 25% surplus over the actual cost of living, not to mention 60% discretionary spending over the costs of rent, food, utilities, clothing, etc. If you're going to compare income and lifestyle, you have to choose a lifestyle that fits the social class, otherwise you risk sounding like lawyers barely scraping by on $500k.
Where did $35/hr wage come from? It's not in any of the graphics. Minimum wage in 1950 was $0.75/hr, which is only $10.25 today. Are you referencing median wage? That would be a much better comparison with 'comfortable' lifestyle, but median income today is close to $60k/year, depending on how you count.
You're not going to get any argument from me that shit is fucked. Everyone should have guaranteed access to housing, food, and healthcare, and we don't. A lot of kids were set up for failure by their parents insisting they take out college loans. But your standard for a minimum cost of living is basically the minimum to live like a boomer in the 70s.
The average white male boomer in the US lived like a king compared to everyone else around them, even at the time. The descendants of those people tend to think that the fact that their parents or grandparents had this means they should too. In reality, those boomers were incredibly lucky to be born into a privileged class during an economic golden age.
We don't get that, we get the world they fucked up. Rich dickheads hogging all the wealth and stealing wages is nothing new, it's been the standard for all of human history. What is new is that you can see clearly how well the privileged live compared to you. Maybe that will cause things to change, idk.
In the meantime, we need to make do. An emergency fund is intended to be used for emergencies, which are things that threaten your ability to acquire basic needs (food, housing, health). You keep it funded at 6 months of expenses (e.g., the minimum you need to meet your financial obligations plus food+rent). When it's full, you don't keep adding to it. When you use money from the fund, you replenish it as quickly as you can. Everyone should have one.
You shouldn't be having an emergency every single year though. If you are, it's not an emergency, it's an extra expense you need to plan for. If you are spending double-digit percentages of your income on debt (car loans, credit cards, etc), you need to stop spending money on anything else but basic needs until you pay it off. Or start a revolution, but we're arguing on the Internet so I don't think the odds of that happening are high.
The world sucks. It's not fair. You can still live a good life in it though, even if it's not as good as it used to be.
I feel like youre missing the fact that even if the federal minimum wage were $35 per hour, absolutely no one working for that wage in the US would be able to afford to live comfortably at 50/30/20 (the thing you primarily take issue with) without working a second job.
Meanwhile, real actual minimum wages in nearly 10 states are still at $7.25 an hour. Let that sink in for a second. There are people close to getting paid literally 5 times less than what it costs to live anywhere near a base level of comfort. That doesnt even go into agriculture, where the federal minimum wage is even lower.
And Im not sure why you are so obsessed with this “boomer in the 70s argument”. Were comparing to the late 1950s when men alone were paid enough to support an entire family of four, which over doubles cost of living numbers. It was also a time when wealth was not concentrated within 1% of society.
I dont understand in literally any way the argument “we just have to do what we can”. Its literally unsustainable for many Americans to even try to do that.
Americans right now hold, collectively, over 1 trillion dollars in just credit card debt. On average each American holds over $6k in credit card debt, which would be over 10% of the average salary earner’s income ($61k). Again, just on credit card debt and nothing else.
In 1950, all debt owned by the average household equated to only 2% of their income. Two percent. And people were way worse off financially in 1950 than they were by 1958
I'll stop here because your position is incredibly privileged and you refuse to see that. The minimum wage is too low, that's not the point though. 70k a year is absolutely a comfortable wage for a single person to live on in almost every place in the US, except the biggest of the major cities.
You may not get everything you want but you should be able to cover everything you need, including an emergency fund, and still have enough to put aside a 5-10% for savings most years on 70k. If you really don't believe that, you live in a bubble.
Lmfao “your position is privileged” bro I grew up poorer than shit, was poor as shit my first 10 working years of my life making $12 an hour at two full time jobs, and now finally make like $52k a year, which is nowhere near enough to live 50/30/20. Both of my parents were making the inflationary equivalent of way more money than what my $52k is worth at the time I was born, and again I grew up well below average in a bad neighborhood. I make $25 an hour and the only reason that is remotely comfortable for me is because my rent is well below 1/3rd of my income, which comes with its own costs. I never truly leave work, since I live here.
Not to mention, genuinely do you not understand that I personally did not define cost of living? Or choose 50/30/20? Im working with the information I have available from an arguably reasonable source. If you take issue with their methods then fucking bother them about it. Im not the mastermind of their cost of living calculations as I told you 4 goddamn messages ago
People keep down voting these common sense arguments.
You are correct and this post is misleading at best.
This is defeatism in full display.