It’s no secret that living in New York City can be expensive, but a new study by financial technology company SmartAsset has shed light on just how much it can impact one’s purchasing power. According to the study, a $100,000 salary in New York City feels like only $36,000, making it the city with the lowest purchasing power out of nearly 80 cities analyzed.
To determine the cities where a dollar stretches the furthest, SmartAsset analyzed cities from Buffalo to Los Angeles using the SmartAsset paycheck calculator and Council for Community and Economic Research data to estimate purchasing power after accounting for living expenses. Each city was analyzed using a salary of $100,000.
The study found that Memphis, Tennessee, had the highest purchasing power for a six-figure salary, coming in at $86,444. This is due in part to the city’s cost of living, which is almost 14% lower than the national average. While Memphis residents can expect to bring home about $75,000 after taxes on a $100,000 salary, the reduced cost of living makes their pay worth nearly $87,000 compared with the national average.
But Texas wasn’t far behind, with representation from seven different cities in the top 10 list. El Paso, Corpus Christi, Lubbock, Houston, San Antonio, Fort Worth, and Arlington all ranked in the top 10 with “feels like” salaries ranging from $80,000 to $85,000.
Oklahoma City came in third at $70,302, while St. Louis rounded out the top 10 at $69,531.
On the other end of the spectrum, the lowest-ranked cities in the study included New York City at a measly $36,000, Los Angeles at $45,000, and just over $46,000 in Boston. While it’s no surprise that these cities have a high cost of living, SmartAsset’s findings reveal that $100,000 doesn’t go as far as it used to, and half of the people making that salary still live paycheck to paycheck.
SmartAsset writer Patrick Villanova notes that a six-figure salary has long been seen as a sign of success and financial comfort for American workers. However, he points out that the times have changed and $100,000 isn’t quite what it used to be, especially with rampant inflation sapping the purchasing power of money and pushing the cost of living higher.
For those looking to make the most of their money, the study by SmartAsset provides valuable insights into which cities offer the best purchasing power for a six-figure salary. While New York City may offer plenty of job opportunities and cultural attractions, the reduced purchasing power means that a six-figure salary may not go as far as one would hope.
On the other hand, cities like Memphis and various cities in Texas provide a more affordable cost of living, allowing residents to stretch their dollars further. Whether you’re just starting out in your career or looking for a change of scenery, SmartAsset’s study offers valuable information to help you make the most of your salary and live your best life.