live on $2000 a month

Yes, You Can Live On $2,000 A Month! Here’s How & Where:

How much you can live on largely depends on your standard and where you live. If you want to live like a king/queen in Manhatten, $2K doesn’t even cover rent, but if you move to Asia, $2,000 a month is awesome!

But let’s try to figure out how you can live, with $2,000 a month, in a few different cities in America. Here’s the short answer:

Yes, as a single person you can live on $2,000 a month. However, you will have to live frugally. Generally, you can not spend excessively on housing, transportation and food. Families of four will find it hard, if not impossible.

I generally think aiming to live on $4,000/month is more realistic for families of four. If you’re able to live highly frugal, $3K/month is also an option.

Let’s get into the details, and really figure out if YOU can live on $2,000 a month (and if so, where):

Where Can You Live On $2,000/Month?

When it comes to expenses and rent, the number one factor is where you live. Therefore, I’ve put together a table showing the expenses a “normal” person, and a family of four, has in different cities:

LocationExpenses Including Rent:
(Single, Family)
New York, NY$4,193, $7,934
San Francisco, CA$3,843, $7,471
Oakland, CA$3,403, $6,853
Washington, DC$3,113, $6,292
Boston, MA$3,268, $6,429
Pittsburgh, PA$2,178, $5,201
Nashville, TN$2,766, $5,740
San Diego, CA$3,118, $6,092
Miami, FL$3,086, $6,058
Chicago, IL$2,611, $5,506
Philadephia, PA$2,430, $5,307
Los Angeles, CA$3,044, $5,917
Dallas, TX$2,496, $5,286
Atlanta, GA$2,365, $5,117
Las Vegas, NV$2,130, $4,797
Orlando, FL$2,364, $4,979
Austin, TX$2,668, $5,264
Huston, TX$2,163, $4,762
Tulsa, OK$1,709, $4,115
AVERAGE:$2,834, $5,743
(Data sources: Cost of Living and Rent Index, Cost of living in New York, Median rent in New York)

As you can see, $2,000 a month only works for a single person in Tulsa (and cities with similar expenses and rent). If you’re a family of four, there are no places on the list that works.

However, the numbers above are the median expenses/rent. If you live more frugally than most others, you can make $2,000 work in many areas.

You should know, that the typical American household spends roughly 35% of their money on housing and another 16% on transportation. 12% goes to food (groceries and eating out).

This means that Americans generally spend A LOT on rent, their car(s) and on eating out.

If you can avoid this trap and live more frugally, you’ll most definitely be able to live on $2,000 a month in several different places.

Suggested reading: Is $5,000 Enough To Move Out?

Let’s look closer at just how frugally you need to live:

How To Live On $2,000 Per Month:

As mentioned above, $2,000 a month doesn’t go a long way if you live like most other people. However, if you budget and think things through, you’ll definitely be able to do it.

Here is the number one thing you need to understand in order to live on $2K a month: Small stuff makes a small impact. Big stuff makes a big impact.

Here’s what I mean:

If you cut out your Netflix subscription and stop drinking the occasional Starbucks coffee, you’re probably only saving $100 a month. In addition, you have to make the choice repeatedly every time you pass a Starbucks or get bored and crave a good movie.

On the other hand, if you move into a cheaper apartment closer to work, you might save hundreds on cheaper rent and hundreds on transportation costs at the same time. In addition, once the move is made it’s made – you don’t have to “stay disciplined” as it’s hard to reverse it.

Basically, this principle can be summarized like this:

Make frugal decisions on the big stuff like housing and transportation and make them hard to undo.

This way you save a ton of money, and even better, you’re automatically saving that money every single month!

Oh, and the best part is that you don’t have to cancel your Netflix subscription!

“Great, but what are the other “big” things?”

Here’s a table of the four biggest expenses American households have:

CategoryPercentage of Monthly Expenses:
Personal Insurance and Pensions11.8%
source: https://www.bls.gov/opub/reports/consumer-expenditures/2020/home.htm

Based on the data above, here are some concrete actions you can take to make sure $2K a month is enough to live on:

  • Get a cheap apartment to save on housing.
  • Live close to where you spend the most time. This is often work and friends.
  • Don’t eat out. At least not more than what social relationships demand.
  • “Shop” for insurance. You can often get cheaper insurance if you “look around”, or haggle on the price.

Those are the most significant actions you can take. They will without a doubt be saving you tons of money and make living on $2K possible in most places of America.

I personally combined the two first action steps on the list above, moving into a cheaper place closer to work. This cut down my expenses by a whopping 40% every month.

You can read more about cutting costs and increasing income in this article: Can’t Save Money Because of Bills? Here’s What I Did

Assuming you’re able to do something similar, let’s cut 40% off of the median numbers, and take a new look at the different cities:

Suggested reading: Is $100K a Year Good? (For Single People and Families of 4)

Places You Can Live Frugally On $2,000/Month:

Below you’ll find the same table as at the beginning of the article. But this time I’ve cut the numbers by 40%. In most places, you’re able to live on $2,000 or less:

LocationExpenses (including rent):
(Single, Family)
New York, NY$2,515, $4,760
San Francisco, CA$2,305, $4,482
Oakland, CA$2,041, $4,111
Washington, DC$1,867, $3,775
Boston, MA$1,960, $3,857
Pittsburgh, PA$1,306, $3,120
Nashville, TN$1,659, $3,444
San Diego, CA$1,870, $3,655
Miami, FL$1,851, $3,631
Chicago, IL$1,566, $3,303
Philadephia, PA$1,458, $3,184
Los Angeles, CA$1,826, $3,550
Dallas, TX$1,497, $3,171
Atlanta, GA$1,419, $3,070
Las Vegas, NV$1,278, $2,878
Orlando, FL$1,418, $2,987
Austin, TX$1,600, $3,158
Huston, TX$1,297, $2,857
Tulsa, OK$1,025, $2,469
AVERAGE:$1,700, $3,445

Living frugally, you can survive in all the cities above except New York, San Francisco and Oakland.

If you’re up for a challenge, you can also try to live on $1,800 a month (for a single person).

For a family of four, living on $2,000 a month seems more or less undoable in most cities, unless you cut your expenses even further, or move to an even cheaper place than Tulsa.

Suggested reading: Is Saving $100 Per Month Good? (Worth it in the long run?)

How To Budget For $2,000 a Month

To ensure you can survive on $2K a month, you need to write a detailed budget.

After all, it’s better to fail to live on $2K in theory, than to fail in real life!

4 steps to make a budget for $2K a month:

  1. List all categories/items you’ll spend money on.
  2. Figure out how much money you’re likely to spend on each item.
  3. Add it all up and figure out your total expenses.
  4. Manipulate the different items to get the total under $2K.

The items/categories in the example below are the most significant, but there are several others. You’re the only person knowing how you spend money, so feel free to add additional items!

Housing (including utilities)$650
Personal care$125
Other Stuff$350

The numbers in the table above are random, but you get the idea. Write a list of the items you’ll spend money on, estimate how much you’ll spend on them, and sum it all up at the end.

If you can’t make $2,000 work, consider reading this article instead: Living On $3,000 A Month – It’s Possible!

If you have no experience making budgets, or no idea what you’ll spend money on, here’s a table from The U.S. Bureau of Labor Statistics you can use as “inspiration”. It shows how the average American spends their money:

ItemMonthly CostPercentage of Budget
(Rent or mortgage and utilities like electricity and water)
(Car payments, gas, bus tickets, vehicle insurance etc.)
(Groceries and restaurants)
Insurance & Pensions
(Personal insurance like life insurance, pension savings etc.)
(Subscriptions, TV, Speakers, a new Phone etc.)
Apparel and Services$1202.3%
Personal care$541.1%

You can read more about the different items over at The U.S. Bureau of Labor Statistics: https://www.bls.gov/cex/csxgloss.htm

Conclusion: Yes, You Can Live (Frugally) On $2K a Month

To live on $2K, you must cut down on the big things. Specifically, be frugal when it comes to housing, transportation and food. You should also shop around for insurance.

Doing the things suggested above, you’ll be able to live in most places. To be sure, you should make a budget.

A family of four will have a really hard time making $2,000 a month work. It’s only possible if you live in an exceptionally cheap area, or live extremely frugally. This is possible, but not easy.

Suggested reading: How Much Money Should You Save Per Day?