Paycheck to paycheck on $200k? What it really costs to live comfortably in Seattle

Chris Ginett just celebrated her 60th birthday. She was looking forward to it.

“My entire life I thought, when I'm in my sixties, I'll get to play again,” she said.

But it hasn’t panned out that way.

“At this rate, I probably won't be able to retire until I'm 70, which is really scary,” she said.

Ginett sells wine and spirits, and she’s lived in the same Mountlake Terrace condo for nearly two decades. It wasn’t meant to be a forever home, but with the region’s rising cost of housing – and just about everything else – upgrading wasn’t an option.

This story first appeared in KUOW's economy podcast, Booming.

When Ginett envisions what a comfortable life in Seattle would look like, it’s modest. She’d like to retire in her 60s, take the occasional vacation, and have enough money for her hobbies. To do that, she estimated she would need $200,000 to $300,000 per year.

Ginett is one of 328 people who participated in a KUOW survey asking what annual salary it would take for their households to live comfortably in the Seattle region. A whopping 71% said they would need at least six figures, with 43% estimating it would take $100,000 to $200,000 per year and 28% saying $200,000 to $300,000. Most respondents lived in one- or two-person households, and although it isn’t a representative survey, it gave us a sense of how people are feeling about the skyrocketing cost of living in the Puget Sound area.

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KUOW followed up with some of the respondents to find out how they estimated what it would take to live comfortably in the region. Many said they worked backward from basic financial milestones they hoped to achieve, like retiring, buying a home, and paying off debt.

“I'm very happy living in my tiny apartment,” said Leah Hagan, a 38-year-old dog walker who lives in Queen Anne. “I mostly just want to pay off debt and be able to keep a car running and keep my rabbits fed. There's not a ton that I really ask for. I would like to take a vacation once in a while.”

For new father Ben Wooley, it would look like “not having to be actively concerned about money and making sure the bills are going to get paid.”

Studies show that to get there, families do need to be earning well into six figures. The financial advisor firm SmartAsset estimates it would take $128,211 for a single adult to live comfortably in Seattle, and $327,475 for a family of four with two working adults and two children. The study analyzed costs in 100 U.S. cities and applied the 50-30-20 rule, which refers to the percentages of a family’s budget that should go toward needs, wants, and savings, respectively.

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Seattle’s median household income is about $120,000 per year, according to the most recent Census data, and that applies to families of all sizes. In other words, most Seattleites are not earning enough to live comfortably, at least on paper.

Kate Dorman said that mismatch often shows up in their financial therapy practice in Seattle.

“I get a lot of clients who make over $100,000… or maybe they and their partner combined make $250,000, $300,000, and they feel like they're living paycheck to paycheck still,” Dorman said. “They don't know how that's possible.”

There are two forces driving the dissonance.

One is simply rising costs. On average, prices are estimated to be about 20% higher than they were in 2020. But Dorman said there’s another, related phenomenon at play.

“We're kind of anchored in our childhood, and I think what happens is if people grew up thinking $100,000 is a lot of money, it probably was a lot of money, at that time,” they said. “Today, $100,000 looks really different. If you fast forward 20, 30, 40 years, $100,000 is not the same. It doesn't have the same purchasing power that $100,000 had before.”

It's the reason that every generation thinks movie tickets have gotten exorbitantly expensive. But this phenomenon is particularly acute in the post-Covid era, because the memory of 2019 prices is still fresh.

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“Inflation has skyrocketed in just a few years, and that's not common,” Dorman said. “A lot of people are trying to catch up to the idea that the price of eggs is $10 for a dozen or 18 eggs, when just a few years ago it was half that.”

For most, it’s not feasible to simply earn more money. But Dorman did have some advice for feeling comfortable on any income. They subscribe to the “Happy Money” philosophy, that is using the money you have to cultivate more happiness and contentment.

For example, instead of focusing on everything that needs to be cut and restricted from the budget, Dorman advises clients to make financial goals they would feel proud to accomplish, like maxing out their 401k or saving up $3,000. If cuts are necessary, Dorman suggests turning everyday drags on the budget into rare treats.

“Someone who goes to Starbucks seven days a week is much less happy than someone who goes to Starbucks one day a week, because going to Starbucks becomes a chore,” Dorman said. “Somebody who [goes] once a week sees it as a treat, so they're more likely to get more happiness out of it.”

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Dorman also recommends taking conversations about money offline and into the real world. They said social media often creates the illusion that everyone else is living large, but it’s often a façade.

“Start having open conversations about money, because people often feel very lonely and feel like they're the only ones that are struggling financially, and that's not the case,” they said. “Statistically, 50% of people — even people making six figures or more — are living paycheck to paycheck. That means if you've got a friend on your right and a friend on your left, one of them is right there with you living paycheck to paycheck, and unless you open that door to that conversation, you're not going to know how the people around you are really doing.”

Listen to the full episode on KUOW's economy podcast, Booming.