Poverty line out of touch with costs, advocates say
A report by the California Budget Project estimates that a two-working-parent family in L.A. needs $74,044 to make ends meet.
By Alana Semuels
Everyone knows living in California isn't cheap. But a new report casts a light on how challenging it is to afford basic necessities — and how inadequate a minimum-wage job is to meet those needs.
A person working full-time for the state's minimum wage of $7.50 an hour earns $15,600 annually. But a single adult in Los Angeles needs to make $28,126 a year to live modestly, while a single parent needs $62,393, according to the California Budget Project, the policy group behind the report being released today.
A two-parent family in Los Angeles with one working member needs $51,035, while a two-working-parent family needs $74,044, the report calculated.
The group estimated the cost of housing, food, transportation, child care, healthcare, taxes and miscellaneous items in regions across the state.
Calculations were based on families who do not receive healthcare through employment, rent rather than own real estate and have a car.
"The standard of living envisioned is more than a 'bare bones existence,' " the report says, "yet covers only basic expenses, allowing little to no room for 'extras' such as college savings, vacations, or emergencies."
They are assuming $1,269 per month for rent and utilities for a family of four. For a three bedroom apartment, that would put you in some place pretty dismal, rather than in a section of LA with decent public middle schools, such as Sherman Oaks or Valley Village. On the other hand, they are assuming $861 per month for health care, so the head-above-water point is a little lower if you get insurance through your job. (Of course, you could pay a lot more than $861 for health insurance on an individual family basis—as a cancer survivor, I once got quoted $1,500 per month.)
To buy a home rather than rent, you'd roughly have to double that income to, say, $150,000, although at present, nobody is buying anymore, so it's all pretty theoretical.