○Once-coveted six-figure salaries are struggling to keep up with today's cost of living, with more than half of people on six-figure salaries still living paycheck to paycheck, new research reveals became.
Inflation is rampant in the economy, with inflation hovering at 6% in February, but even high-income earners are building wealth, especially in expensive cities, according to a study conducted by financial advisory firm SmartAsset. It is recognized that people are struggling with this. According to a study by financial insights and advisory firm PYMNTS and Lending Club, 51% of people making more than $100,000 as of December 2022 reported living paycheck to paycheck, and this has increased by 7% from the previous year.
In a new study from SmartAsset, researchers calculated income taxes on $100,000 at the federal, state, and local levels to determine the real take-home pay of earners in 76 large cities across the United States. We use 2022 cost of living data. SmartAsset researched prices in these cities from the Community Economic Research Council and analyzed how much purchasing power income earners actually have. The cost of living index includes average prices for housing, groceries, utilities, transportation, and other goods and services.
The study found the worst places to live for people who earn $100,000 a year. Adjusting for taxes and cost of living, $100,000 would cost just $35,791 in New York, NY, $36,026 in Honolulu, HI, $36,445 in San Francisco, CA, $44,307 in Washington DC, and $44,623 in Long Beach and Los Angeles, CA. Masu.
Using the same metric, the best cities to live for someone making $100,000 are Memphis, Tennessee, El Paso, Texas, and Oklahoma City, Oklahoma. In Memphis, $100,000 is worth $86,444 thanks to a cost of living that's 14% lower than the national average. The seven most advanced six-figure cities are in Texas, which is valued for its low cost of living combined with no state income tax.
According to career advice firm Zippia, 18% of Americans earn more than $100,000, and income, like the cost of living, varies widely by city and state.
Zippia data also shows that 56% of Americans believe earning an annual income of $100,000 will make them rich; Rather, they are considered upper middle class, and in some countries they can even be considered lower middle class. City. The median U.S. salary in 2022 is $44,225, according to Zippia, so it's a big concern if Americans earning more than twice that are struggling.
SmartAsset shares some advice for people with six-figure incomes, including suggestions for making the most of your retirement accounts. Contributing the maximum amount possible to a retirement account reduces the contributor's tax liability for the year and may even place the contributor in a lower tax bracket. It also recommends checking a city's cost-of-living record before moving, and consulting a professional financial advisor to save as much as possible on taxes.
