Is $175k a Good Salary for a Family of Four in Northern Chicago Suburbs?

A salary of $175,000 is generally considered a good income for a family of four in the Chicago area, particularly in the northern suburbs. However, it's important to consider several factors that can significantly impact your financial comfort and ability to purchase a home in these areas.

Cost of Living

The cost of living in the northern suburbs of Chicago includes a range of expenses such as housing, property taxes, childcare, education, healthcare, and day-to-day living costs. Here’s a detailed breakdown of these costs:

Housing Costs

The cost of homes can vary dramatically in the northern Chicago suburbs. As of 2023, median home prices in areas such as Evanston, Skokie, and Lincoln Park can range from $400,000 to over $1 million, depending on the neighborhood. A salary of $175,000 should ideally support a comfortable mortgage, especially if you have a decent down payment. However, high median home prices mean that affordability can be a challenge in these areas.

Property Taxes

Illinois has relatively high property taxes, which can significantly impact your monthly expenses. Ensure that you factor these taxes into your budget when considering a purchase.

Family Needs

For a family of four, additional expenses such as childcare and education are crucial:

Childcare and Education

Childcare costs can be substantial, depending on your children's age. Public schools in northern suburbs are often well-rated, offering a financial advantage if you opt for public education.

Healthcare

Consider your healthcare costs, including insurance premiums and out-of-pocket expenses. Adequate health coverage can provide peace of mind and financial security.

Lifestyle

When considering a move to the northern suburbs of Chicago, several lifestyle factors come into play:

Transportation

Public transportation is available, but commuting by car can also be common, especially in suburban areas. Factor in transportation costs when planning your budget.

Groceries and Other Expenses

General living expenses such as groceries, entertainment, and dining out must be factored into your budget. These costs can add up, especially for a family of four.

Financial Comfort

Managing finances with a salary of $175,000 is possible, but it requires careful budgeting:

Debt-to-Income Ratio

Lenders typically prefer a debt-to-income ratio of 36% or lower. With a salary of $175,000, you should be able to manage your monthly expenses comfortably if you budget wisely.

Conclusion

Overall, a salary of $175,000 can support a comfortable lifestyle for a family of four in the northern Chicago suburbs. This amount can be used to purchase a home and cover essential living expenses. However, it's essential to create a detailed budget to account for your specific situation, ensuring that you make informed financial decisions.

While a salary of $175,000 offers a good starting point for financial stability, sitting at two times the average salary for a family of four, it allows for a reasonable quality of life in the northern suburbs. If the financial demands of supporting two children are too high, it may be advisable to consider a more urban or suburban area with lower costs.