Edinburgh has the highest average annual salary (£25,543) outside London with weekly household expenditure of £386.50 compared to a UK average of £426.30. Rents in Edinburgh (£1,099) took up just over half of annual salaries (52%) compared to a shocking 93% in London, while the city has an unemployment rate of just 5.5%.
MoneySuperMarket's 'Quality of Living Index', which assessed 12 of the UK's largest cities, put Birmingham in last place with the lowest disposable income of £13,575 a year per person against a UK average of £17,559. London was second from bottom due to the astronomical cost of living in the city.
Kevin Pratt, consumer finance expert at MoneySuperMarket, said: "Anyone who lives in or who has visited Edinburgh won't be surprised to learn that it has clinched the top spot in our Quality of Living survey.
"It is a beautiful city with stunning architecture and a thriving cultural scene and, in addition, it has over the last year benefited from lower unemployment and lower cost of living. People in the Scottish capital have also seen a rise in disposable income and salaries over the last 12 months, propelling the city to the top of the list of best places to live in the UK.
"Overall, the UK's largest cities perform well in the Quality of Living index. While in some cases, salaries have fallen slightly and the cost of living has risen, hitting some cities hard, life satisfaction scores are generally higher across the board compared to last year.
"What's more, these cities have benefited from falling unemployment, a decrease in rent and a rise in disposable income over the last year. Added to this, property prices are on the rise again, so many home owners are seeing their properties increase in value. So there are many reasons for British city-dwellers to be happy, not just those living in Edinburgh."
Another city which scored highly was Belfast, as the Northern Irish capital has seen unemployment drop from 6.8% last year to 6.5% in 2015.
Cardiff was third with an average weekly household expenditure of just £384.60, while people residing in the Welsh capital have above average disposable income of £16,520 per head.
