How cost-effective is your city? More precisely, how well does your hometown rank in median income when incomes are adjusted for the local cost of living? This combination of qualities can be thought of as the “cost-effectiveness” of a city, as measured by adjusting income for cost of living. A number of news sources produce “best cities” lists, and Kiplinger Magazine’s list enables a simple calculation of cost-effectiveness, since it publishes both median income and a cost-of-living index for each city [1]. The ranking of the 50 largest cities in the US by cost-effectiveness (median income / cost of living) is provided below:

Metro Area	Cost of Living Index [2]	Median Household Income	Adjusted Income [3]
1. Atlanta-Sandy Springs-Marietta, GA	0.94	57307	60965
2. Indianapolis-Carmel, IN	0.88	52607	59781
3. St. Louis, MO-IL	0.87	51713	59440
4. Washington-Arlington-Alexandria, DC-VA-MD-WV	1.38	81163	58814
5. Dallas-Fort Worth-Arlington, TX	0.92	53748	58422
6. Austin-Round Rock, TX	0.94	54827	58327
7. Houston-Sugar Land-Baytown, TX	0.89	51685	58073
8. Cincinnati-Middletown, OH-KY-IN	0.9	51926	57696
9. Denver-Aurora, CO	1.01	58039	57464
10. Nashville-Davidson–Murfreesboro–Franklin, TN	0.88	49979	56794
11. Kansas City, MO-KS	0.95	53564	56383
12. Charlotte-Gastonia-Concord, NC-SC	0.92	51702	56198
13. Salt Lake City, UT	0.98	55064	56188
14. Philadelphia-Camden-Wilmington, PA-NJ-DE-MD	1.03	57831	56147
15. Minneapolis-St. Paul-Bloomington, MN-WI	1.14	63866	56023
16. Columbus, OH	0.94	51687	54986
17. Hartford-West Hartford-East Hartford, CT	1.19	64989	54613
18. Jacksonville, FL	0.94	51269	54541
19. Las Vegas-Paradise, NV	1	54299	54299
20. Seattle-Tacoma-Bellevue, WA	1.14	61740	54158
21. Richmond, VA	1.05	56277	53597
22. Detroit-Warren-Livonia, MI	1	53593	53593
23. Phoenix-Mesa-Scottsdale, AZ	1	52857	52857
24. San Francisco-Oakland-Fremont, CA	1.37	72059	52598
25. San Jose-Sunnyvale-Santa Clara, CA	1.58	82664	52319
26. Chicago-Naperville-Joliet, IL-IN-WI	1.13	58946	52165
27. Birmingham-Hoover, AL	0.9	46667	51852
28. Boston-Cambridge-Quincy, MA-NH	1.29	66870	51837
29. Louisville-Jefferson County, KY-IN	0.89	46095	51792
30. Memphis, TN-MS-AR	0.86	44495	51738
31. Baltimore-Towson, MD	1.21	62524	51673
32. Sacramento–Arden-Arcade–Roseville, CA	1.15	58480	50852
33. Orlando-Kissimmee, FL	0.98	49789	50805
34. Milwaukee-Waukesha-West Allis, WI	1.02	51669	50656
35. New York-Northern New Jersey-Long Island, NY-NJ-PA	1.21	60964	50383
36. Rochester, NY	0.99	49508	50008
37. San Antonio, TX	0.93	46203	49681
38. Virginia Beach-Norfolk-Newport News, VA-NC	1.1	54442	49493
39. Oklahoma City, OK	0.89	43652	49047
40. Pittsburgh, PA	0.92	44814	48711
41. Buffalo-Niagara Falls, NY	0.93	44747	48115
42. Cleveland-Elyria-Mentor, OH	0.99	47600	48081
43. Providence-New Bedford-Fall River, RI-MA	1.16	54064	46607
44. San Diego-Carlsbad-San Marcos, CA	1.32	60970	46189
45. Portland-Vancouver-Beaverton, OR-WA	1.17	53935	46098
46. Tampa-St. Petersburg-Clearwater, FL	0.99	45243	45700
47. Riverside-San Bernardino-Ontario, CA	1.23	54991	44708
48. New Orleans-Metairie-Kenner, LA	1.06	45802	43209
49. Los Angeles-Long Beach-Santa Ana, CA	1.42	56680	39915
50. Miami-Fort Lauderdale-Pompano Beach, FL	1.2	47527	39606

Atlanta tops the list, followed by Indianapolis, St. Louis, Washington D.C., and Dallas. Rounding out the top 10 are Austin, Houston, Cincinnati, Denver, and Nashville. What city holds the unfortunate designation of being least cost-effective? Miami/Ft. Lauderdale is dead last, with Los Angeles, New Orleans, Orange County (California), and Tampa/St. Petersburg all in the bottom 5.

It clearly pays to live in Atlanta or the other top cities, as higher incomes and lower costs translate into a higher quality of life or simply greater net savings. The cities at the bottom of the list generally suffer from high real estate prices and rental costs coupled with lower median incomes.

[1] Here’s the full spreadsheet of data from Kiplinger.com including 300+ metro areas.

http://www.kiplinger.com/tools/bestcities_sort/index.php?sortby=hhi&sortorder=DESC

[2] The Cost of Living Index in Kiplinger.com’s original list is set so that the average cost of living in the US is 100. Here I have divided the Kiplinger index by 100 so that it can be more easily used in the Adjusted Income calculation.

[3] The Adjusted Income, or cost-effectiveness, is calculated by simply dividing a city’s median income by its cost of living (when the cost of living is a ratio centered around 1 as discussed above).