Can You Afford to Live in New York City? Here’s how to find it

A young couple holding hands and smiling while sitting on the floor near the moving box.

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Living in New York City can be incredibly expensive, but it doesn’t have to be.


Key points

  • The cost of living in Manhattan is nearly double the national average.
  • The average one-bedroom apartment in New York City costs $3,860 a month.
  • There are several ways to significantly lower your New York City living costs, such as finding cheap neighborhoods, living with roommates, and being frugal with your spending.

New York City tops almost every cost of living survey out there. Indeed, the latest Cost of Living Index (COLI) shows that the cost of living for people living in Manhattan is almost twice the American average. Brooklyn isn’t doing much better either. Now, you don’t have to live in Manhattan or Brooklyn to live in NYC, but it’s still an expensive place to live.

So, can you afford it? And how can you tell? Here are some questions to consider.

1. What is your budget?

Everyone’s financial situation is different, so the first step is to look at what you earn and how much you expect to spend. It’s hard to estimate your cost of living if you don’t live in New York City, but it’s fair to say that almost everything will be more expensive. These statistics can help your calculations:

  • Groceries in Manhattan cost about 35% more than the national average, according to COLI data.
  • Going to the movies will run you over $19 per ticket compared to $6.50 in other parts of the country.
  • Rent can be upwards of $3,000 a month, but if you’re willing to share and live in a less well-known area, you can drop that number to $1,500 or less.

In terms of rent, the rule of thumb is to spend not more than 30% Your income on housing, so use this as a starting point. Get ready to spend more — The NYC Mayor’s Office says a third of renters spend more than half their income on rent.

Once you have a budget outline, you can play around with the figures and see what living in New York City can mean for your quality of life. If you’re spending 40% or more of your income on housing and another big chunk on groceries, utilities, and transportation, you probably don’t have much breathing room.

Don’t forget the savings factor and investment. It can be very tempting to sacrifice these long-term goals to meet the day-to-day costs of living. However, if you don’t have three to six months of living expenses saved up in a savings account to cover unexpected emergencies, how would you cope if you lost your job? Similarly, neglecting your retirement savings can prove costly further down the line.

2. Are you willing to live with other people?

The latest data from Zumper shows that the median rent for a one-bedroom apartment in New York City is $3,860 a month. A two-bedroom place will set you back $4,300 a month, meaning you can almost halve your housing costs by sharing with one person. If you are willing to share with more people, you can cut this figure even further. Living with a roommate will also lower your bills.

3. Are you flexible on your location?

If you don’t have to be in New York City, consider some lower cost area in New York state. This may be more feasible if your employer offers hybrid work so that you can work remotely for at least a few weeks. Some high earners have left New York entirely in favor of lower cost countries.

In New York City itself, check out more affordable neighborhoods, such as Riverdale and Spuyten Duyvil in the Bronx, Kew Gardens and Sunnyside in Queens, and Bay Ridge in Brooklyn.

4. Can you live frugally?

New Yorkers may pay more for the privilege of living in the Big Apple, but salaries are also higher. Data from the US Census Bureau puts New York State in the top 15 states by salary, although DC, New Jersey, and Massachusetts all have higher average incomes.

The problem is that even if you earn a decent salary, New York City will quickly destroy your finances if you don’t look at the bottom line. Live frugally It doesn’t mean giving up everything you love and shivering in winter. But that means being intentional about spending and not wasting money on things you don’t need.

To live in New York City, you probably need to eat a little, reduce the cost of your groceries, and walk or bike more than you usually do. This could mean inviting friends over for dinner instead of eating out, skipping some take-out coffee, and opting for secondhand clothes instead of buying new. There are many ways to enjoy life without spending a lot of money, especially if you keep an eagle eye out for discounts on things you want to do and buy.

5. Can you get housing assistance?

There is a housing assistance program in New York City but the competition is fierce. If your income meets certain criteria, you can put your name down for housing Connect Lottery and / or register on the waiting list for affordable rentals when they become available. You may be required to undergo a credit check or provide 12 months of rental history, and you may also be required to pay several months’ rent as a security deposit.

Bottom line

It’s always hard to know what you can afford because it depends on how many compromises you’re willing to make and what you’re getting. If you want to live in New York City, the important thing is that you find a way to live within your means and not neglect your other financial goals. Spending more than you earn is a recipe for financial trouble, no matter where you live.

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