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Cost of Living is Drastically Different across the U.S.

By Taff Weinstein at

Cost of Living is Drastically Different across the U.S.

Cost of Living is Drastically Different across the U.S.

The cost of living can look drastically different depending on where you are. It will cost a single person about $29,118 a year to live in Brownsville, Texas, for example, but in San Francisco, California, that expense more than doubles, to $69,072.

The Economic Policy Institute's (EPI) newly updated family budget calculator, shows how much income for differently sized families is needed in order to attain a baseline standard of living across the U.S. In other words, it measures "what families need to get by," says EPI Senior Economist Elise Gould.
You can access their calculator by clicking here.

The calculator factors in geographic differences in cost of living and six main expenses: housing, food, transportation, health care, other basic necessities and taxes.

"In order to keep the budgets modest, the calculator notably does not include many expenses associated with a middle-class lifestyle, such as paying off student loans or saving for college or retirement," the EPI notes.

The EPI gathered data for 10 family types in all 3,142 counties and in all 611 metro areas.

Below is a list of 10 metro-city areas across the country so you can see how housing expenses and the cost of living stacks up in each area.

San Antonio, Texas
Housing costs: $649 per month ($7,788 per year)
Total cost of living: $2,716 per month ($32,587 per year)
Columbus, Ohio
Housing costs: $601 per month ($7,212 per year)
Total cost of living: $2,719 per month ($32,632 per year)
Jacksonville, Florida
Housing costs: $604 per month ($7,248 per year)
Total cost of living: $2,759 per month ($33,104 per year)
Indianapolis, Indiana
Housing costs: $599 per month ($7,188 per year)
Total cost of living: $2,794 per month ($33,530 per year)
Dallas, Texas
Housing costs: $730 per month ($8,760 per year)
Total cost of living: $2,880 per month ($34,563 per year)
Phoenix, Arizona
Housing costs: $684 per month ($8,208 per year)
Total cost of living: $3,143 per month ($37,715 per year)
Philadelphia, Pennsylvania
Housing costs: $824 per month ($9,891 per year)
Total cost of living: $3,191 per month ($38,291 per year)
Chicago, Illinois
Housing costs: $879 per month ($10,548 per year)
Total cost of living: $3,217 per month ($38,605 per year)
Los Angeles, California
Housing costs: $1,067 per month ($12,804 per year)
Total cost of living: $3,569 per month ($42,825 per year)
New York, New York
Housing costs: $1,514 per month ($18,168 per year)
Total cost of living: $4,277 per month ($51,323 per year)

What Happened to Rates Last Week?

Mortgage backed securities (FNMA 4.00 MBS) lost -3 basis points (BPS) from last Friday's close which caused fixed mortgage rates to move sideways for the week.

Overview: MBS pricing (and therefore rates) were squeezed by opposing forces. On one side, we had a Fed Rate Hike and an increase in the projected number of rate hikes for 2019 and 2020. On the other side, you had increasing deficits with the new $1.3T spending bill and concern over a trade war with China and other major economies. This kept mortgage backed securities stuck in a very tight range all week.

The Talking Fed: The Federal Open Market Committee (FOMC) released their interest rate decision and policy statement on Wednesday. They also released their economic projections. You can read the official monetary policy and Fed statement here.

As expected, the FOMC increased their Fed Fund rate by a 1/4 point. And actually had a slightly stronger outlook compared to December. Here are some highlights:
- Changed the word "solid" as in solid rate of growth to "moderate".
- Said "Recent data suggest that growth rates of household spending and business fixed investment have moderated from their strong fourth-quarter readings"
- Kept their dot plot chart at 3 total rate hikes for 2018 but shifted to more rate hikes in 2019 and 2020.
- Still, 7/15 "dots" (not quite half) still see 4 rate hikes in 2018.
- Upgraded their median 2018 GDP forecast from 2.5% to 2.7%
- Upgraded their median Unemployment Rate from 3.9% down to 3.8%
- Kept their core inflation projections at 1.9% for 2018

During his live Press Conference, the quote that got the attention of bond traders (and sent MBS to their best levels of the day) was "a number of participants reported that about their conversations with business leaders around the country and reported that trade policy has come a concern going forward for that growth."

Geo-Political: The President signed the $1.3T spending bill (after threatening to veto it) and will keep the government funded but only until October.

Trade War? The original tariffs (which actually don't legally exist yet) for steel and aluminum have been postponed. But yesterday's launch of $50B in tariffs on China over stolen IP, has China responding with a list of 128 U.S. products that they will have a tariff on.

What to Watch Out For This Week:

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