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Top 50 US Cities - Ranked by Financial
Quality of Life          
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(March 5, 2012)  

US Cities - Ranked by Financial Quality of Life

Best-Financial-Advice.com has examined and ranked the
most populous 50 cities / areas in the US by their financial
quality of life. Financial quality of life is defined here as the
ratio of median income to median expenses, adjusted for
the uncertainty of employment and career advancement,
as gauged by the unemployment rate*.  We have created
a financial Quality-of-Life Index through which we
completed the ranking of these cities. The results are
probably surprising to most. The top ten cities are:

















In some ways the cities at the top of the list may be
considered a surprise, as they may not have previously
been thought of as having a high relative quality of life.  
And some of the more prominent cities in the country (New
York, Los Angeles) are close to the bottom of the list. The
ratio of income to expense for these cities drives this
phenomenon. The highest ranking cities are those where
you get the most for your money - how much money is
earned relative to what general prices are. So a city like
Columbus, Ohio, where the median salary is 43% of  the
price of the median house beats out, by far, a city like LA
where the average income to housing expense is 19%. Not
to mention that Columbus has an unemployment rate of
6.4%, as compared to 10.6% in LA

Of course, this highlights that there are many other
reasons why people prefer one area over another. There
may be many attributes that LA has that few other areas
do. But on a strictly financial level, these figures / ranking
should be carefully considered. These rankings should
only be used as additional information, to be combined
with knowledge of your preferences. If you like beach
towns it may not matter that an inland location is much
easier on your pocketbook, or is much easier to find a job.
But looking at the relative rankings may help you to judge
which shore areas may be the best place for you, for
example.

Similarly, much depends on your specific earning situation.
For example, if you have technical skills that some
particular cities have a much greater demand than other
high ranked cities, then that particular concern would
outweigh other factors in your city location decision. One
can narrow their city preferences by employment criteria
and then supplement this information with this list.

Let’s take a look at the top City / area, Minneapolis, St.
Paul, Bloomington:
Like all of the top rated cities, this city has a relatively high
income relative to housing and other expenses. The
average income in this area is $62,500 a year. The
average house costs $155,000. So the average income
has no problem buying the average house (or renting the
equivalent). It also has a low unemployment rate of 5.5%,
well below the National average of 8.3%. This area has an
unemployment rate equal to what the national rate was
before the financial meltdown of 2008. So people in this
area on average are not constrained with the same level of
economic uncertainty as those in many other areas of the
country.

Let’s compare this to one of the worst areas of the country
as measured by this criteria, the New York-Northern New
Jersey-Long Island, NY-NJ-PA area. The average income
in this area is $62,235 a year. Minneapolis actually has
higher median income, and the cost of housing is less
than  half of that in the NY area. The average house costs
$378,700 in NY area. In NY, the average income is not
able to buy the average house (or renting the equivalent).
It also has an unemployment rate of 8.2%, similar to the
national average of 8.3%.

Of course, a lot of different economic experiences in these
cities can be camouflaged by the median/averaging
process that is employed here. This is true. For example, a
city like New York has a very wide range income earners.
The higher earners enjoy an out-sized higher quality of life
relative to the median just as the low earners invariably
have a much lower quality of life. Still, in this largest of
metropolitan areas, there are many average level earners
who strain to live a quality lifestyle in a very expensive
area. The median figures do capture quality of life
concerns for this very large group (at least 50% of the
earners).  

In Part 2 we’ll discuss more of the underlying points
concerning this study.

Click here for the Complete list of 50 Cities – Ranked by
Financial Quality of Life.


Also, here are some additional links which rank cities by
various quality of life indices:

http://www.kiplinger.com/guides/best-cities/
-  this is primarily from a value perspective, geared toward
low-cost cities especially.

http://images.businessweek.
com/slideshows/20110920/america-s-50-best-cities/
- this is an from an overall perspective including quality of
life, jobs, amenities, etc.

http://www.forbes.com/best-places-for-business/list  
-  This is from a best place to do business and to work
perspective.


______________________________________________

Notes:
* Income figures are as of 2010, Expenses (housing
figures) are as of Dec 2011, unemployment figures are as
of January 2012
- The cities / areas listed conform to the Census Bureau’s
MSA definitions, which usually consist of one or more  
major cities in an area plus the outlying suburbs that lie in
close proximity and economically intertwined with the larger
area’s economy.














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