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Financial security's cost keeps rising, group's study says
In the two years since the recession officially began, the number of families earning under $25,000 in Washington has crept up in every bracket.
"We're facing a growing gap between the top and bottom, with increasing unemployment and job losses and people making less than they did a couple years ago," said Audrey Singer, a demographer with the Brookings Institution. "There's been a lot of concern about how people can make ends meet in a region such as this one, which has been fairly buffeted during the recession."
By most measures, however, many Washingtonians are well out of financial fear territory. With a median household income of $85,000, according to the latest census data, and an unemployment rate well below the national average, the Washington region is considered the most affluent in the country.
It is also among the costliest.
The Council for Community and Economic Research, an Arlington County-based organization that calculates cost-of-living indexes, estimates it costs about 40 percent more to live here than it does in cities closer to the average, such as Salt Lake City, Las Vegas and Dover, Del.
It lists Washington as the 11th most expensive place to live in the country, just above Oakland, Calif., and behind Nassau County, adjacent to New York City.
"Though we'll never be accused of being a low-cost area, we do reasonably well compared to other major metropolitan regions in the U.S.," said Matt Erskine, senior vice president at the Greater Washington Board of Trade.
He cited another index that lists the region as the seventh most expensive in the nation and 66th internationally.
Because Washington is a relatively costly place, even the highest estimates of how much a family needs to earn are conservative, said Kuriansky.
Montgomery County uses WOW's formula in gathering information for its biannual report on how much income is needed to be "self-sufficient" and live in the county without government assistance.
Its last report, in 2008, said almost $80,000 was necessary for two adults with one infant and one schoolchild.
Today, WOW's new report estimates, that family would need $104,00, including $7,500 for savings.
The study's release coincides with the impending election of a new mayor in the District and his inauguration in January.
The group urged the new administration to focus more resources on programs like job training and financial literacy, and it wants residents of the region to use the cost-of-living tables as a model for saving.
"We believe we're offering not just numbers but a road map for what we can do in the District to enable more residents to be able to move toward more economic security and less anxiety," Kuriansky said.