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Here's what a $100,000 salary is really worth across the U.S.

A $100,000 salary has long served as the benchmark for attaining financial success, but for workers in New York City, Honolulu and San Francisco, raking in $100,000 isn't enough to float a cushy, six-figure lifestyle, a new study shows

According to an analysis from financial information provider SmartAsset, workers earning $100,000 a year in those three cities take home what comes down to a little over $35,000 after taxes and adjustments for costs of living.

SmartAsset analyzed salaries in 76 cities, adjusting them for taxes and cost of living to determine how much money residents would have to earn each year to feel the spending power of a true $100,000 salary. The analysis' cost-of-living data accounts for the price of housing, groceries, utilities, transportation, in addition to other goods and services. The data reflects the cost-of-living index for the third quarter of 2022.

Residents of the three next most costly U.S. cities — Washington, D.C.; Long Beach, California; and Los Angeles — didn't fare much better. A $100,000 income in those places, equates to roughly only $45K in purchasing power, according to SmartAsset's analysis of the Council for Community and Economic Research's cost-of-living data. 

On the flip side, those living in major cities like Houston or San Antonio, come closest to obtaining the true purchasing power of their six-figure salaries, although they still fall short, at around $80,000 worth of take-home pay. Workers in Memphis, Tennessee, where residents have the most purchasing power, still only enjoy about $86,444 in take-home pay for their annual salary of $100,000. 

Housing prices soar in the East while falling in the West 04:49

U.S. cities with the most purchasing power are generally concentrated in the nation's south, the analysis shows, especially in states like Texas and Tennessee, which have no personal income tax. 

Moving from High-Cost Cities to Low-Cost Cities

Rising living expenses and taxes have prompted residents of higher-cost cities to relocate in recent years. 

According to a report from the National Association of Realtors, more people are leaving pricey metropolitan areas like New York, Chicago and San Francisco than are moving in, while states that have a lower cost of living, like Florida, Texas and North Carolina continue to see their populations rise. 

To some degree, remote work is propelling those relocations. According to job search website Ladders, just 4% of high-paying jobs were remote before the pandemic, compared with 15% in 2021. 

The exodus of higher-income workers to more affordable cities could spell trouble for pricey areas like New York, where taxes fund much-needed social safety-net programs, and given that the highest-earning Americans pay the most in combined federal, state and local taxes, according to the Tax Foundation. 

In December, New York State Comptroller Thomas DiNapoli warned legislators that raising the state's already high taxes could motivate affluent residents to head out to more tax-friendly states, decreasing the state's tax revenue base. 

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