Americans Cannot Live on $80,000 a Year

"America is home to billionaires, some research shows. However, that means nothing to most people who live in the United States. The median household income of Americans rose to $83,730, adjusted for inflation, last year, up very slightly from 2023. This takes people back to what the number was in 2019, based on purchasing power. Many Americans cannot live on that. Among people below this median, some Americans can barely live at all, particularly in many expensive cities."

"The components include transportation (which varies widely from city to city), food (the cost of which is still increasing, the Consumer Price Index shows), housing (home prices have hit all-time highs, and New York City rents are at a record), utilities (in some areas, electricity costs have jumped because of artificial intelligence), health care (the cost of which could rise as much as 4%)."

"GoBankingRates keeps a list of cities where the cost of living requires a median income of over $115,000. This varies somewhat based on whether people rent or buy homes. Home prices continue to put a house out of reach for many people. The median price of a home for sale in the United States is above $400,000. Mortgage rates are at about 6%, which is a multiyear high."

Median U.S. household income rose to $83,730 last year, adjusted for inflation, returning roughly to 2019 purchasing power. Many households below the median struggle to cover essential daily expenses in high-cost areas. Key expense categories include transportation, rising food prices per the Consumer Price Index, record-high housing costs and rents, utilities with some electricity increases linked to artificial intelligence, potential health-care cost rises of about 4%, and higher apparel prices due to tariffs on China. The national median home price exceeds $400,000 and mortgage rates near 6% remain a multiyear high, leaving many markets unaffordable without substantially higher incomes.

Read at 24/7 Wall St.