Residents of New York City, San Francisco, and Honolulu would need bring in a salary higher than $300,000 to have $100,000 in purchasing power, according to a new study.
Financial tech company Smart Asset, reported the startling conclusion from a study analyzing how a $100,000 salary compared with the local cost of living in 76 of America's biggest cities.
The study found New York, San Francisco, and Honolulu have the highest cost of living — over 80% above the national average. Residents there would have to earn over $300,000 to actually feel like they have $100,000 coming in annually.
Honolulu topped the list requiring an income of $312,400 pre-tax. New York came in at a close second with $312,000 needed, while San Francisco required $310,700.
At the other end of the spectrum, Memphis, El Paso, and Oklahoma — all cities with a cost of living below the national average — had the lowest earnings needed to have $100,000 of purchasing power.
In Memphis, where the cost of living is 13.8% below national average, you would need $117,100. In El Paso, $119,300 would help you get by since the cost of living is 12.3% below average. Similarly, in Oklahoma, a $120,300 salary would suffice.
In general, the study found states with no state income taxes have an edge when it comes to overall purchasing power. Those states include Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
According to Business Insider, over half of Americans with salaries above $100,000 were living paycheck to paycheck in December 2022 as inflation outstripped wage growth, citing a January survey.
The outlet also noted, since inflation hit a peak of over 9% in June 2022, it has since dropped steadily — though remained high in March at 5%.
A March 29 survey by Smart Asset found that in New York City, $100,000 amounts to just $35,791 when you consider taxes and the cost of living, with Boston and Los Angeles closely behind, with $100,000 equating to $46,000 and $45,000 respectively.
Fran Beyer ✉
Fran Beyer is a writer with Newsmax and covers national politics.
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