Here's exactly how to figure out how much rent you can afford

Here's exactly how to figure out how much rent you can afford
AP Photo/Paul Sakuma, File
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How much rent you can afford is equal to 30% of your annual gross income, experts say.

But if you want to build more wealth, try limiting housing costs to 30% of your take-home pay.

We calculated how much rent people can afford after federal taxes and a pretax 401(k) contribution of 10% at ten different income levels, from $50,000 to $200,000.

Most Americans blow their budget on three things: Housing, transportation, and food.
The typical US renter spends about 30% of their gross income on rent, according to the latest data from the US Census Bureau. Meanwhile, residents in some high cost-of-living cities, including Los Angeles, San Francisco, and New York, spend more than 37% of their income on rent each month, according to a Zillow report.
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