How much you need to make in the Bay Area to live comfortably?

San Francisco is one of the most beautiful cities to live in the United States. It is known for its diversity, beautiful nature and never-ending great weather that lasts all year long. Lots of people from around the nation and the world dream about moving and living in San Francisco.

The only drawback of living in the Bay Area is that the cost of living is considered to be one of the most expensive in the United States. Housing and renting costs, food, bills, and transportation are significantly higher than most of the cities in the nation.

If you are thinking to move to the Bay Area, having some knowledge of what it might cost you to live there is beneficial without a doubt. Considering that the affordable cost of living greatly differs between different places and that every individual has his own financial circumstances, the figures we mention below will help you understand the specific amount of money you’ll need to have a decent, comfortable life.

Housing cost in San Francisco

• Renting a place. Rent prices were always high in San Francisco and they are not stopping at climbing further up. The average rent of one bedroom apartment is $3,600 as of April 2019. Two bedroom apartments go at $4690 a month. For someone who is coming from Midwest or South, these prices can be shocking and scary. In cities like Memphis or Cincinnati, monthly income of $3600 is sufficient not only to own a house with the backyard and garage, but also you can spend the remaining on groceries, necessities and then still have some portion of it saved. In San Francisco, you would spend the whole amount just for rent and you would have no money left.
• Buying a house. San Francisco’s housing market is tied to its attractive housing market. Although the soaring price of buying a home has slowed down, momentum is still going. At the end of the second quarter of 2019, the price of the single family houses in San Francisco hit $1.7 million, up $80k compared to last year. Condos go at around $1.3 million which is an increase in $65k compared to the previous year.

Cost of food in San Francisco

• Eating out. Obviously eating in restaurants is always more expensive than if you cook at home. You can double the cost on eating out in San Francisco compared to most of the other cities in the US. According to the report of numbeo.com in 2019, the average cost of eating out for two in mid-range restaurants in SF is $80 which is easily a double of the national average.
• Eating at home. Of course if you are willing to save money, making your own meals at home is the best choice. Compared to the national average, San Francisco is still considered expensive place to even cook your own food at home due to the higher grocery expenses. Numbeo.com report finds that the average monthly cost per person on food spending is $423.75 while the rest of the US residents live on average of $324.20 per month.

Cost of transportation in San Francisco

• Owning a car. Having your own car for daily commute in San Francisco is pretty expensive. California is known as the most expensive state when it comes to the cost of gas in the United States. San Francisco has the highest fuel price per gallon in the state of California which makes it the most expensive city for gas prices in the US. The average price of gas per gallon is $4.20. According to the U.S. Census Bureau, commuting to work takes 32.8 minutes in San Francisco, which is six minutes longer than the 26.4-minute national average. So you end up driving a lot if you use your car as a single main means of transportation. Besides gas, you would need to consider maintenance costs, parking, insurance and tickets that can add up pretty quickly.
• Using public transportation. If you want to save money and alternative options to commute, then you would use city’s public transport system. Your monthly pass for bus and cable car would cost you $78 per month, while a pass that also gives an access to BART (Bay Area Rapid Transit) trains inside the San Francisco would cost $94. Using public transportation in San Francisco is actually cheaper than Chicago ($105) and New York City ($116.5).

Utility costs in San Francisco

This is one part of the expense where residents in San Francisco get a break. The costs of utility bills average slightly above $100 per month for the houses that are in about 1000-square-foot sizes thanks to the climate of San Francisco. It rarely gets very cold in winters and it doesn’t get very hot in summers. That translates into less heat and electricity usage all year long. Moreover, people often switch to energy-efficient light bulbs and home appliances to save extra bucks on utility expenses.

Taxes in San Francisco

• State Income tax. Similar to most cities in California, taxes are high in San Francisco. The highest tax that you would be hit with is an income tax which is considered one of the highest in the United States. The top 12.3% rate applies only to taxable income above $572,980. If you make over a million dollars per year, then you would have to pay 1% extra of surtax.
• State sales taxes. The sales taxes rate in California is 7.25%, but if you add city and county taxes on top of it, then it would come out to 8.50% in San Francisco.
• Property taxes. Generally in California and in San Francisco itself, the property taxes are lower than the national average which stays at 0.67% average effective property tax rate. This has happened thanks for the California Proposition 13 which has capped increases and reduced property tax rates in assessed home values.

There are definitely pros and cons of living in San Francisco. You might be spending more money on your living expenses, but keep in mind that you are also able to earn a higher salary there as well. People who work in San Francisco have higher incomes compared to the national average in the United States.

Now as you have more knowledge on the budget you need to have to keep up with living expenses, you are able to make a better decision whether moving and living in San Francisco would work for you or not.

Thanks again for reading. If you enjoyed this article, please share it with your friends and family. Please also follow our publication for the latest Bay Area stories!