Since When Does a $166,000 Salary Make You Middle Class?

Libby Kane

cost of living in new yorkIt’s hard to pinpoint the American middle class, but an income $166,000 per year probably isn’t it–except in Manhattan.

The New York Times just published a piece, “What’s Middle Class in Manhattan?” that’s either fascinating, appalling or just factual, depending on where you live. It explains how, due to the exorbitant cost of living in New York City, the city’s residents exist within a social structure unique to the city, and eons away from most of the country.

Basically, the traditional markers of a middle-class lifestyle–a solid job (police officer or teacher) and a mortgage–don’t apply in New York. Due to the cost of living in the Big Apple, people in such occupations don’t fall in the middle of the pack income-wise as they would in other cities, and the astronomical cost of housing erases the stigma of renting.

Among the points made by The Times:

  • Rent for the average Manhattan apartment is $3,973 a month, $2,800 more than the average rent nationwide. Last year, the average Manhattan home sold for $1.46 million, compared to the nationwide price of a little under $230,000.
  • The Pew Research Center found that, in terms of purchasing power, a $70,000 annual income is considered middle class for a family of four, but that same family living in Manhattan would need to make $166,000 to achieve the same purchasing power.
  • To be considered part of the 1% in Manhattan, you must make over $790,000 per year.

To most Manhattanites, the numbers inspire more resignation than shock. (Also, semi-desperate curiosity: Where exactly is that Columbus Circle apartment one woman found for $600 per month, with roommate? Related: Is she moving anytime soon?)

For the rest of us, it adds some hard facts to those stories about one-percenters feeling poor or unable to keep up. Of course, they aren’t poor, but it’s quite possible that, living in New York City, they’re unable to keep up with their neighbors. Not that their myopia is necessarily excused–about half of the world’s 1% live in the United States.

Above all, The Times article is a conversation piece, so let’s have a conversation: Where do you live? How does your home compare to New York? And if you live in Manhattan, how do you feel about the high cost of living?

  • Doe Jane

    I live in Milwaukee ( I’m originally from NJ) and I LOVE it. My first 2 bedroom apartment in a okay neighborhood here cost $525 per month! 

    The houses in the really nice areas of Milwaukee, particularly if you are into duplexes (don’t knock  it, who wouldn’t want someone else to pay their mortgage?) run anywhere between 125k and 180k.

    And Milwaukee has a fantastic ‘foodie’ scene, great music, quality nightlife and a wonder park system. You can also hop on a train or drive to Chicago in an hour if you feel like expanding your horizons.

    PLUS the salaries are comparable to the East Coast. My starting salary at a local nonprofit  was around $55,000 ( only an undergrad degree in sociology), and now my rent is only 200 bucks with one housemate.

    I mean seriously?

    Move people.

    Just move.

    ( yes, I know it depends on your priorities in life, but ‘keeping up with the Joneses’  will leave you broke… and last time I checked, your ‘close by family’ didn’t pay your mortgage or rent!)

  • Mary

    I read the NYT article yesterday too. I live in NJ in Union County and  rent a one bedroom apartment for 1330 per month, but everything, even electricity is included. The apt is extremely spacious and its in walking distance to the train which I take into Manhattan everyday for work. 

    The only reason I chose this apt was because of its proximity to the train station for work. Each month I spend 150 on my commute. The last place I lived in Middlesex County, NJ I was shelling out 400 on transportation, which is why I moved…Believe me if I didn’t work in NY and was able to drive to work every day I would have been able to find an apt that is cheaper than 1330, maybe in the 900s, but it’s what I have to do for now.

    For contrast…

    One of my friends who works in the city pays 1300 for a utility apt in Manhattan. For those who don’t know a utility apartment is smaller than a studio. Her heat and hot water isn’t even included. I could never imagine paying that much for a space so small! 

  • Jen

    I live 5 miles outside of Boston (still within the subway radius). This suburb is probably 40% below the poverty line, with the rest mostly divided between working class and middle class. I pay $1,700 p/mo including utilities, for a fairly contemporary 2-bd/2-bath apartment with room enough for a small family, in a large, safe building with apx. 100 units. 
    My rent is lower than average because I have been in the same unit for a long time, so I pay annual, incremental increases in rent, but have avoided the big jumps of market rental rates in the past few years. It also means my place is pretty outdated and starting to be run down. The management company makes zero improvements and avoids anything more than basic maintenance until a united is vacated.

    I could save $200 p/mo if I moved to an old building and a small 2-bd/1-bath. I could save perhaps $400 p/mo if I moved to a run-down apartment inside a 100-year-old 3-family house (a very common architecture around here), and in a much less safe neighborhood. 

    Since I have a school-aged child and am a single mom, these “savings” options don’t necessarily seem worth it. This is my kid’s childhood I’m shaping. I want her to feel “normal” and safe, and not to be moving around from place to place. $1,700 is doable for me when my income is steady, but I work in an unstable industry and have faced ups and downs over the years. It was very tough to make ends meet during a couple periods of unemployment. I was pretty creative!

    My best friend lives with her husband and child in Brooklyn. I think that together they earn about 3x my salary, and they sure don’t live extravagantly. My apartment is about 40% bigger than theirs. I really appreciate that $160,000 per year by no means makes you rich in NYC!

  • Jamie Nolan

    $166k for a family of four is middle class in DC as well.

  • Knitsewbake

    Chicago also has a very high cost of living. My boyfriend and I combined make over 200k per year and we still find ourselves living on the edge of what is considered a ‘safe’ area. People are mugged only a couple streets over and yet we pay 2k per month for a small apartment. I can’t say we’re struggling but if we added children to the mix we would be in too deep and have to move elsewhere (making the commute excessive). I imagine it would be difficult to find a safe area for children with good schools and make less than 166k in this area.

  • Guest

    I live in the Bay Area and make 168k. I own a townhouse located in a safe, affluent city in the East Bay (cheaper than the Peninsula but still in the low 500′s). Cost of living here is high but not impossible – I have no debt (other than my mortgage), a decent savings/investment portfolio, drive a 5 year-old luxury car and take vacations every year. If you resist the urge to keep up with the neighbors you can do just fine out here.

  • guestny

    I’ve lived in NYC for almost 8 years now.  I pay 2300/mo for a studio on Roosevelt Island (just slightly cheaper than what you could get in the city for the same type of unit).  Rents have gone up drastically every year, and salaries have not.  Even staying in the same apartment does not save you from rent increases here.  I earn ~113k/yr and it is hard to save.  There is no way people in NYC spend only 30% of their salary on rent.  Sure, living further outside the city you could get a bigger apt and maybe lower rent, but then you usually then have to own a car and pay for that and car insurance..  It all ends up the same in this area.

  • bcalnyc

    I live in Brooklyn and my household income is under $60K (gross, not adjusted) and we have 2 adults, one 7 year old, one college kid (last year there were 2) and we manage just fine.  We have vacations, eat out on occasion and manage to pay the bills without going into debt.
    Housing in the city is certainly a cost issue.  We’re lucky since we bought in1999 so we pay less than most but it’s the OTHER ways people spend that shock me.  Who needs a car in NY, really?  There are a zillion of every kind of store – don’t tell me there aren’t bargains to be found!
    I wouldn’t raise my kids anywhere else.  And that, as they say, is priceless.