Posted February 6, 2025 at 12:47 pm by Katherine deCourcy and Elise Gould

EPI’s updated Family Budget Calculator shows that states like Virginia need a higher minimum wage

EPI’s Family Budget Calculator (FBC) is a widely cited tool for determining what it takes to make ends meet for different family types in all counties and metro areas in the United States. For more than 20 years, we have calculated family budgets for basic expenses like housing, food, health care, child care, transportation, other necessities, and taxes. In doing so, we create a more location-specific and realistic assessment of cost of living than traditional poverty thresholds.

We use government-provided data where possible and stay up to date with changes in policy and data availability. Because of this, and due to related changes in methodology, we don’t recommend comparing budgets over time. For more details on the construction of EPI’s family budgets and all of the datasets we use, see the full methodology.

The FBC interactive tool can be used to compare family budgets within and across family types and counties and metro areas. Using the family budget tool, one could, for example, compare annual and monthly budgets for three different family types in a specific county or metro area. They could also compare the same family type across three different counties or metro areas, or a combination of these. For a video tutorial on how to use the FBC, see here. The full dataset is downloadable at the bottom of our FBC page.

Example case: Most and least expensive metro areas in Virginia

Using family budgets in Virginia as an example, Figure A compares each budget component for one-parent, one-child and two-parent, two-child families in the least expensive (Pulaski) and most expensive (Washington-Arlington-Alexandria) metro areas in Virginia.

Not surprisingly, larger families are more expensive across nearly every dimension. The largest cost difference across these two metropolitan areas comes from housing, which is more than twice as expensive in Arlington than in Pulaski. Child care costs are also significantly higher in Arlington due to higher rent costs and other expenses in urban areas. On the other hand, transportation costs are greater in a less urban area like Pulaski because of the greater need for a car. This is just one example of how FBC data can be used to compare total and individual component budget costs for different family types.

Figure A

The cost of living varies widely in Virginia: Family budgets for one-parent, one-child and two-parent, two-child families, Pulaski and Arlington metro areas, 2024

Housing Food Transportation Health care Other Necessities  Child care Taxes
One-parent, one-child $10,860   $5,540   $16,147   $7,549   $5,518   $7,499   $8,137 
Two-parent, two-child $10,860   $10,890   $18,914   $15,097   $7,318   $15,037   $10,493 
One-parent, one-child $24,540   $7,296   $15,197   $7,145   $10,711   $17,691   $18,370 
Two-parent, two-child $24,540   $14,342   $17,482   $14,290   $13,082   $32,436   $23,626 
ChartData Download data

The data below can be saved or copied directly into Excel.

Note: "Pulaski" refers to Pulaski County, VA HUD Metro FMR Area and "Arlington" refers to Washington-Arlington-Alexandria, DC-VA-MD HUD Metro FMR Area.

Source: Authors' analysis of EPI Family Budget Calculator data.

Copy the code below to embed this chart on your website.

The Family Budget Calculator can be used to calculate living wages

The FBC has been cited by living-wage advocates, private employers, academics, and policymakers who are looking for comprehensive measures of economic security. EPI’s family budget tool is also frequently used to gauge the adequacy of labor earnings, and we are often asked how to construct a living-wage standard from our family budget numbers. Doing so requires making choices and assumptions about how a family’s needs could or should be met that will result in different “living wage” values. For instance, health care expenses could be covered primarily by families, employers, or public programs (such as Medicare or through premium subsidies in the health insurance marketplace). We provide a user’s guide to translate our FBC data into living wages.

The FBC can also be used to roughly calculate the hourly wage necessary to meet a family budget through labor market income alone. For a full-time, year-round worker providing for themselves and their family, we simply divide the required budget by 2,080 (40 hours a week multiplied by 52 weeks a year) to get an hourly wage equivalent.

Example case: Scott County, Virginia

Take Scott County, the lowest cost county in Virginia. Figure B at the bottom of this post shows that an adult worker without children who has an annual family budget of $38,652 would need to make $18.58 per hour full-time, year-round to attain a modest yet adequate standard of living. One common benchmark for setting living wages is that an adult should be able to support themselves and one child with full-time work. In Scott County, a worker in a one-parent, one-child family with an annual budget of $56,372 would need to make $27.10 per hour to make ends meet.

These basic calculations assume that all income comes from wages; however, wages are not the only resource available to families. If an employer offers health insurance or the state subsidizes child care, the wage needed to meet a basic family budget would be reduced, as shown in Figure B. Conversely, if reasonable savings for retirement, college, or emergencies are considered critical budget items, then the living wage required would be even greater.

Family Budget Calculator shows that Virginia needs a higher minimum wage

Our family budget calculations highlight the need for a higher minimum wage in Virginia. The Virginia minimum wage of $12.41 per hour—even given its latest increase for inflation on January 1, 2025—is unable to provide a modest yet adequate standard of living for one adult in the lowest cost county in the state. For one adult worker earning all income from wages, the minimum wage falls short by $6.17 per hour, or more than $12,800 annually. The gap is even larger for a one-parent, one-child family—with a deficit of $14.69 per hour, or more than $30,500 annually.

Figure B

Virginia minimum wage is insufficient even in the lowest cost county: Virginia minimum wage rate and living wage rates in Scott County, Virginia, 2024

Measure Living wage
Virginia minimum wage $12.41
One adult, all income from wages $18.58
1p1c, all income from wages $27.10
1p1c, child care capped at 7% of income $26.22
1p1c, employer-provided health care $24.28
ChartData Download data

The data below can be saved or copied directly into Excel.

Note: "1p0c" refers to one-parent, no children families and "1p1c" refers to one-parent, one-child families.

Source: Authors' analysis of EPI Family Budget Calculator and living wage data.

Copy the code below to embed this chart on your website.

Virginia’s 2020 minimum wage legislation puts the state on the path to $15 an hour by 2026. However, the state legislature is required to reintroduce legislation every year to approve minimum wage increases beyond a simple inflation adjustment. Unfortunately, after the legislature authorized the next increase in 2024, Governor Youngkin vetoed the legislation. The Virginia legislature is going to try again in 2025 to get the state back on track to increase the minimum wage and help the nearly 400,000 Virginians making less than $15 an hour.

But it’s not just Virginia—the Family Budget Calculator shows that there is nowhere in the country where a minimum-wage worker is paid enough to meet the requirements of their local family budget on their wages alone. EPI’s Family Budget Calculator is a vital tool for understanding the true cost of living for families across the United States.

Tagged