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November 17, 2021

Do You Have Too Many Bank Accounts â or Too Few?

How Many Bank Accounts Should You Have? – SmartAsset Close thin Facebook Twitter Google plus Linked in Reddit Email

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Stephanie Colestock Nov 16, 2021

These days, bank accounts can do a lot. They make it easy for you to track your spending and receive transaction alerts, often in real-time. They allow you to transfer between accounts and even send money to others in just seconds, even from a smartphone. And many of these accounts also help you reach your savings goals with budgeting tools, automation and competitive interest rates. However, odds are that you won’t be able to achieve all of this with just one bank account. Here’s a look at how many bank accounts you should realistically have and why you truly do need more than one.

Consider working with a financial advisor as you fine-tune your personal finance strategies and priorities.

Why You Need a Checking Account

A checking account is intended to be an everyday transaction account. It allows for both deposits and withdrawals and can be used for a variety of day-to-day spending.

You’ll typically use your checking account as a landing pad for your paycheck, before re-allocating funds elsewhere. From your checking account, you can pay bills, make daily purchases, transfer funds and more. These funds are usually considered short- to medium-term in nature, as they are constantly being spent and replenished.

Money in a checking account can be accessed a number of different ways, depending on the financial institution and even the specific account type. Generally, though, checking accounts offer a combination of debit cards and paper checks, as well as online transfer options.

Why You Need Savings Accounts

Savings accounts, on the other hand, are better suited for medium- to long-term funds, rather than daily spending. The money you keep in a savings account can be tagged for a range of future savings goals, from next month’s vacation fund to your child’s college savings and beyond.

These accounts may be linked to other bank accounts you hold, such as checking. That way, you can easily transfer funds over and track your savings progress. Some banks also allow you to use a linked savings account as automatic overdraft protection on your checking account.

Additionally, most savings accounts offer interest on the balance held. This is often much greater than the interest offered on your checking account (if that account accrues interest at all). This can help amplify your savings and ensure that your money is always working for you.

While you are generally allowed to make as many deposits into a savings account as you’d like, you’re limited in the number of withdrawals you can make in a single statement cycle. Per Regulation D of the Federal Reserve, deposit accounts classified as “savings” are limited to no more than six withdrawals per month. If you exceed that limit, you may incur a fee or see your account closed.

How Many Bank Accounts Should You Have?

So, the question is, how many bank accounts do you actually need? And the answer really depends on your financial situation and your goals.

In general, you should aim to have at least the following bank accounts.

One account for everyday spending: You need at least one checking account for day-to-day transactions. This account is typically where your paycheck will be deposited, and is what you use for small purchases and payments.
One account for short-term savings: Short-term savings goals might include vacations, holiday spending, the down payment on a new car or other big purchases. Choosing a high-yield savings account can help boost your balance without extra effort.
One account for long-term savings: Longer-term savings goals might include emergency savings, college expenses or the down payment on a future home. Since these funds don’t necessarily need to be immediately accessible, you can afford to choose a bank that offers competitive features and returns.

You might also consider opening a separate bank account for:

Monthly bill-paying or budgeting: If you use the envelope method for budgeting, or simply want to set cash aside for monthly bills, consider using a separate bank account. This can make it easier to track spending throughout the month. It also ensures that you always have enough money available for important bills.
Specific savings goals: You may already have emergency savings, retirement savings and even college savings accounts. If you have smaller, specific savings goals, though, you may even want to open separate bank accounts for those. For example, this could be where you keep savings for this season’s Christmas gifts, so you aren’t bombarded with expenses at the end of the year.
Separate/shared household funds: Yours, mine and ours — that’s how many of today’s couples choose to manage their finances. It may make sense for you and your partner to each have individual bank accounts (even if it’s just for your own guilt-free spending money) as well as one joint “household” account. In this case, you’ll need at least three bank accounts between you.

What to Keep in Mind

Whether you decide to have two bank accounts or 12, there are few things to keep in mind.

Some bank accounts have fees. Certain checking and even savings accounts may charge monthly maintenance fees. These fees are often waived if you meet certain deposit or average balance thresholds; if you don’t meet these requirements, though, the costs can really add up quickly.

Make sure you’re maximizing interest rates. Right now, according to the FDIC, the average savings account has an APY of just 0.06%. However, you may be able to earn much, much more than that by shopping around for a high-yield account, like those offered by many online institutions.

Keep good records of your accounts. The more accounts you have, the easier it is to mix them all up or even forget about some small savings you set aside. Make sure you keep good (but secure) records. You may also want to make a note of these accounts in an In Case of Emergency (ICE) folder, in case something were to happen to you and your spouse needed to manage the funds.

The Bottom Line

For most adults, a single bank account isn’t enough to juggle incoming funds, manage daily spending, and save for future financial goals. How many bank accounts you need really depends on how you manage your money and what your personal goals are, both short- and long-term. For some folks, two or three bank accounts might be perfect. Others could need 10 or more to meet all of their needs.

Tips on Banking

A trusted financial advisor can help you determine which bank accounts are necessary and how they should best be managed. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors in your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
If you’re investing on your own, you should be prepared for what the investment markets can throw at you. SmartAsset is here to help you on your investment journey, with a number of free online resources. For example, check out our free investment calculator today.

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Stephanie Colestock

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October 27, 2021

2021 Average Savings by Age Group

2021 Average Savings by Age Group – SmartAsset Close thin Facebook Twitter Google plus Linked in Reddit Email

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If you have enough money, putting some kind of savings aside for both short- and long-term goals is important. After covering general expenses for your daily or monthly budget, an emergency fund could help you prepare for short-term costs such as unforeseen medical, auto, travel and other bills. Long-term savings can, of course, be used towards things that are less of an emergency, like planning for future vacations, buying a car or a home, and retirement. A financial advisor could help you create a financial plan for these goals. Let’s take a look at how you compare with the average savings by age group in 2021.

Savings Recommendations vs. Reality

The first thing to remember when thinking about savings is that the capacity to save is a very important factor. While the typical recommendation is to have three to six months’ worth, many Americans simply don’t have the ability to squirrel that much away. Recommendations can give you a good sense of a ballpark, but the reality for each person or household will by no means look the same as the others. Situations can vary based on factors that are individual (a life event or adjustment of one’s daily needs) and/or large-scale (such as national or world events).

Savings by Age Group

In the same way that spending broadly varies by generation and age group, average savings figures do too. The below data is based on the 2019 Federal Reserve Survey of Consumer Finances and figures reference what is referred to in the survey as “transaction accounts.”

Age	Average Savings Account Balance
35 and younger	$11,200
35 – 44	$27,900
45 – 54	$48,200
55 – 64	$57,800
65 and older	$60,400

The youngest and oldest age groups will of course have the most variation within them. The youngest cohort, after all, includes minors who are unlikely to have much savings at all, and the oldest includes retired folks who are working their way through their savings. A central habit to remember and perhaps start building at a younger age is to start an emergency fund and save as much as possible, before other responsibilities and expenses (such as rent and insurance) start to kick in.

When thinking about saving for more long-term financial goals such as retirement, average amounts also vary by age group. Based on the data from Federal Reserve report, retirement savings increase with each age group and can often become more aggressive as the traditional retirement age approaches (when it could also be time to think about catch-up contributions to an account). Average savings sometimes drops over time after age 65.

Multiple Income Streams Can Help You Save

If you have the capacity to do so, there are many ways to set aside some money for an emergency fund or other savings account – and it’s never too late. Depending on schedules and ability, a variety of other sources of income can be available to you. These include getting a part-time job or opening a business.

Saving is different from investing, which is another option to consider as an income stream. While investing is riskier than saving and serves a different purpose, it can help you grow some savings without having to actively work at a job to earn them.

Bottom Line

Average savings account balances depend on many factors, including age. Age may sometimes affect how much experience you have, how much you make and what your expenses might be. Multiple income streams, including investing, can help you save more.

Tips for Navigating Your Savings

Need help finding a financial advisor? SmartAsset’s free tool matches you with up to three financial advisors in your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Budgeting benefits everyone. Another way to make sure your money covers all your bases is to plan ahead. A good start is to take a good look at how you’re allocating your money. Our free budget calculator can help you spend just what you need in certain parts of your life and still feel like a million bucks.

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Nadia Ahmad, CEPF® Nadia Ahmad is a Certified Educator in Personal Finance (CEPF®) and a member of the Society for Advancing Business Editing and Writing (SABEW). Her interest in taxes and grammar makes writing about personal finance a perfect fit! Nadia has spent ten years working as a seasonal income tax assistant, researching federal, state and local tax code and assisting in preparing tax returns. Nadia has a degree in English and American Literature from New York University and has served as an instructor/facilitator for a variety of writing workshops in the NYC area.

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August 22, 2021

How Do Demand Deposit Accounts Work?

How Do Demand Deposit Accounts Work? – SmartAsset Close thin Facebook Twitter Google plus Linked in Reddit Email

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Rosemary Carlson Jul 30, 2021

Having a demand deposit account is the first step many people take when they embark on a saving and investing program. Most consumers begin with a checking account and add a savings account or a money market account as time passes. These accounts help you in many ways. They are a convenient way to pay your bills on time and get cash. They help you store money and earn a return on it. They are important to the economy at large since they are a part of the money supply. Here are the facts.

A financial advisor can help you coordinate your checking, saving and investing programs to maximize their efficiency.

What Is a Demand Deposit Account?

A demand deposit account allows you to deposit money and retrieve it at any time on demand. Demand deposit accounts require no advance notice to the bank or other financial institution from which you are going to withdraw your money.

Demand deposit accounts are important because the money available in them is what keeps the economy running smoothly. Consumers use money that is in demand deposits to pay bills, make everyday purchases, get cash and make purchases online. Demand deposit accounts have no maturity date, unlike time deposits. Time deposits, like certificates of deposit, have a maturity date. There are three major types of demand deposit accounts.

Checking Accounts

Checking accounts are the most common type of demand deposit that you can open at a financial institution. There is usually no limit to the number of withdrawals and deposits you can make. They are the most liquid of all accounts, more liquid than savings accounts or money market accounts. The price of liquidity of a checking account is interest income. They seldom pay much, if any, interest. Checking accounts often have a minimum initial deposit. They can be accessed through the use of paper checks, linked debit cards, and electronic funds transfer. Most checking accounts in the U.S. are held at banks or other financial institutions that are insured up to $250,000 by the Federal Deposit Insurance Corporation (FDIC).

There are many different types of checking accounts. There are business and personal accounts. There are no-frills accounts, senior citizen accounts, student accounts, interest-bearing accounts and reward accounts to name a few. The more benefits a checking account offers, the higher the service fees on that account. A share draft account at a credit union is a demand deposit account and just another type of checking account with one difference. Share draft accounts signify that you have some ownership in a credit union. They typically have no service charges.

The conventional wisdom is to keep one month’s take-home pay in your checking account in case of emergency.

Savings Accounts

The lines of what you use a checking and savings account for are gradually blurring. Savings accounts are usually offered by banks as a service to customers. These accounts are interest-bearing and pay interest based on the prevailing market interest rates. Market interest rates on this type of account are low. Bank savings accounts are traditionally used to hold money that you do not intend to use to pay daily expenses. That’s the role of checking accounts. Instead, they are used to store money. Most recommendations are to hold three to six months of take-home pay in your savings account in case of emergency.

Along with savings accounts at your local bank, you can open a savings account online. There are a number of online, high-yielding savings accounts insured, like your local account, by the FDIC. In July of 2021, the FDIC reported that savings account interest rates were around 0.04%.

Most banks do offer NetBanking or MobileBanking with a savings account. They will make it possible for you to send and receive money on a mobile basis. Many banks will also offer Billpay so you can use automatic payments for utilities, credit card payments, and other services. Debit or ATM cards are also provided.

Most banks do not assess service charges on savings accounts. However, you usually have to meet a required minimum balance. If you drop below that minimum balance, you may be assessed a service charge.

Since it is just not feasible or safe to carry around enough cash with you to qualify as savings, a savings account can store your money with very low risk. They are insured by the FDIC just like checking accounts.

Money Market Accounts

Money market accounts (MMAs) are the third type of demand deposit account. If you can leave some money untouched for more than one year, a money market account may be for you. There are two differences between an MMA and a bank savings account. The first is the high minimum balance. MMAs may have a minimum balance of as much as $5,000. Most savings accounts have very low minimum balances.

The high minimum balance on an MMA makes this type of account good for those who are trying to save toward a goal like accumulating enough money to buy a car or make a down payment on a house.

The second difference is that interest rates on MMA’s change weekly. Savings account interest rates do not change that frequently. MMA interest rates tend to be higher than those for savings accounts.

The MMA, which should not be confused with a money market fund, is a demand deposit account that is good for risk-averse consumers. Since it is insured for $250,000 by the FDIC, the MMA is as safe as savings accounts and certificates of deposit. MMAs earn the highest return of all demand deposits. They have no monthly maintenance fees. If you go over the check-writing limit of three checks per month, you usually have to pay a penalty.

MMAs are not quite as liquid as checking and savings accounts, but they are more liquid than stocks and bonds. You do not have to find a buyer in order to retrieve your money.

Why Demand Deposits Are Important

It isn’t feasible for the American consumer to keep their money in cash and pay all their bills in cash, so using demand deposits is the next best thing. Demand deposits are important for another reason. Demand deposits are a large part of our M1 money supply. The level of the M1 money supply determines how much banks have available to loan out to their customers.

The level of demand deposits held by a bank determines how much it should keep on hand as bank reserves. Any money that banks have above their required reserves is their excess reserves. Excess reserves are what banks have available to loan to customers.

The Bottom Line

When you first start learning how to invest, your first investment may be an MMA. You may store money in that demand deposit account for large purchases that are a year or two away. It also pays to have money to cover emergencies in your checking account and savings account. After you have your emergency money in place and you are well along your way to making any large purchase that you want, then you can consider moving into riskier investments that could yield a higher return like mutual funds, ETFs, stocks and bonds.

The three types of demand deposits are part of the backbone of the American economy since they are part of M1 and are used to calculate bank reserves. Any excess reserves are used to make loans to consumers. Demand deposit accounts are part of the money creation process.

Tips on Saving

Use SmartAsset’s savings calculator to see how quickly your savings will grow.
Consider working with a financial advisor as you consider how much of your money to put in demand deposit accounts and how much to put into investment securities. Finding a financial advisor doesn’t have to be hard. If you use SmartAsset’s financial advisor matching tool, you’ll be connected, within minutes, to several financial advisors in your area. If you’re ready, get started now.

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Rosemary Carlson

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May 4, 2021

Best Places to Get Out of Credit Card Debt â 2021 Edition

Best Places to Get Out of Credit Card Debt – 2021 Edition – SmartAsset

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The Federal Reserve says that revolving consumer credit debt – including debt from credit cards, home equity lines of credit and personal lines of credit – increased to $974.4 billion in February 2021, marking a 10.1% annual rate increase from the year prior. This is almost one-third of all consumer debt – which also includes student and car loans – and adds up to a grand total of $4.2 trillion. With so many people trying to pay off credit card debt, SmartAsset crunched the numbers to identify and rank the best cities where it’s easiest to do so.

To do so, we considered unemployment rate, median post-tax income, lower-quartile rents and disposable income to find where debt could be paid off the fastest, assuming average interest rates and a total debt of $7,935. For details on our data sources and how we put all the information together to create our final rankings, check out the Data and Methodology section below.

This is SmartAsset’s 2021 study of the best cities to get out of credit card debt. Read the 2019 version of the study here.

Key Findings

Timelines can vary widely. Debt in the top 10 cities of our study can be paid off in just over 10 months, while the average for the bottom 10 is almost 18 months. Frisco, Texas is the city where debt can be paid fastest – under nine months. And Arlington, Virginia takes more than four times longer – a little over 36 months.
Residents in smaller cities can pay debt faster. Small and mid-sized cities in this study can pay debt off quickly. All of the top five cities have fewer than 250,000 residents. Affordable rent and a sizable disposable income (which is the money you take home after taxes) are key factors for residents in these cities to pay off debt.

1. Frisco, TX

Frisco, Texas residents can pay off a credit card debt of $7,935 in 8.59 months. The post-tax income for high-school graduates in this city is just over $37,000. And with a lower-quartile rent (the most affordable unit one could reasonably acquire) of $1,126 per month, residents can afford to make monthly debt payments of $979.

2. Reno, NV

Reno, Nevada residents can get out of $7,935 debt in 9.43 months. The post-tax income for high school graduates is around $31,000 and the lower-quartile rent is $787 per month. This means that if they apply 50% of their disposable income after rent to paying down credit card debt, they can afford a monthly payment of $896.

3. Gilbert, AZ

The median post-tax income for high school graduates in Gilbert, Arizona is $35,463. Residents in this city can pay off a credit card debt of $7,935 in 9.60 months. And with a lower-quartile rent (the lowest number under which 25% of renters pay for rent) of $1,192 per month, monthly debt payments of $882 are possible.

4. Anchorage, AK

Anchorage, Alaska residents can pay off a credit card debt of $7,935 in 10.04 months. The median post-tax income for a high school graduate is $30,650 and the lower-quartile rent is $863 per month. If a resident applies half of their disposable income to paying down debt, they could make monthly payments of $846.

5. Chesapeake, VA

Chesapeake, Virginia residents can pay a debt of $7,935 off in 10.11 months. The median post-tax income for a high school graduate is $29,087, Furthermore, the most affordable rental unit, at the lower-quartile mark, costs $744 per month. With just over $20,000 in disposable income after rent, residents can apply half to monthly debt payments of $840.

6. St. Louis, MO

St. Louis, Missouri’s median income for high school graduates is just under $26,000 and the lower-quartile rent total is $519 a month. If someone with that income and rent adopted a relatively aggressive repayment strategy and put half of their disposable income towards paying a credit card debt of $7,935, they would be free of credit card debt in 10.37 months.

7. Fort Wayne, IN

Fort Wayne, Indiana’s median post-tax income for high school graduates is $24,881 – the lowest in the top 10 of this study. The lower-quartile rent (the most affordable unit one could reasonably acquire) in this city is $496 a month. Someone with almost $19,000 in disposable income after rent could pay off a total credit card bill of $7,935 in 10.81 months.

8. Lincoln, NE

The median post-tax income for a high school graduate in Lincoln, Nebraska is $25,828. And the lower-quartile rent in this city is $589. If residents were able to afford to put half of their disposable income after rent towards repayment, they could pay down a credit card bill of $7,935 in 10.91 months.

9. Tulsa, OK

Residents in Tulsa, Oklahoma could pay off a credit card debt of $7,935 in 10.98 months. This is based on a median post-tax income of $25,038 and a lower-quartile rent payment of $532, which means that they could afford a monthly debt payment of $777 using a relatively aggressive repayment strategy.

10. Oklahoma City, OK

Oklahoma City, Oklahoma is the most-populous in the top 10 of this list and it has a median post-tax income of $25,125 for high school graduates. The lower-quartile rent payment is $558 a month. Using a relatively aggressive repayment strategy, a resident who puts half of all disposable income after rent towards debt could pay a credit card bill of $7,935 in 11.12 months.

Data and Methodology

In order to find the best places to pay off credit card debt, we created a credit card debt payment model for 56 cities. To determine our list of cities, we excluded cities with a population smaller than 200,000 and those with a below-average unemployment rate.

To complete the analysis, we first calculated the amount of disposable income a high school graduate could have in each city, assuming he or she earned the median salary for high school graduates with no further education. Using SmartAsset’s income tax calculator, we found the after-tax income for local high school graduates. We then subtracted the annual lower-quartile rent to get how much disposable income the average high school graduate would have. Lower-quartile rent is the lowest number under which 25% of renters pay for rent.

We then assumed that high school graduates would dedicate half of their disposable income to credit card payments. Using that figure, we calculated how long it would take to pay off $7,935 of credit card debt, determined by dividing the estimated outstanding credit card debt by the number of households in the U.S. in February 2021. We also assumed consumers would be paying interest of 15.91%, which was the estimated average credit card interest rate, according to the Federal Reserve.

Data for population, median income for high school graduates and lower-quartile rent comes from the U.S. Census Bureau’s 2019 1-year American Community Survey. February 2021 unemployment figures come from the Bureau of Labor Statistics (BLS) and are measured at the county level.

Credit Card Tips

Consider consulting an expert. A financial advisor can help you plan so that you don’t find yourself in debt. SmartAsset’s free tool connects you with financial advisors in five minutes. If you’re ready to be matched with advisors, get started now.
Budgeting can go a long way in minimizing or even preventing debt. A budget is another way to make sure you don’t end up with too much credit card debt. Use SmartAsset’s free budget calculator to plan how much to spend on various categories so you don’t end up owing more than you make.
Choose the right card for you. If you do use a credit card, use SmartAsset’s Best Credit Cards rankings to find one that is best for your lifestyle.

Questions about our study? Contact [email protected]

Photo credit: ©iStock.com/Farknot_Architect

Ben Geier, CEPF® Ben Geier is an experienced financial writer currently serving as a retirement and investing expert at SmartAsset. His work has appeared on Fortune, Mic.com and CNNMoney. Ben is a graduate of Northwestern University and a part-time student at the City University of New York Graduate Center. He is a member of the Society for Advancing Business Editing and Writing and a Certified Educator in Personal Finance (CEPF®). When he isn’t helping people understand their finances, Ben likes watching hockey, listening to music and experimenting in the kitchen. Originally from Alexandria, VA, he now lives in Brooklyn with his wife.

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April 22, 2021

Highest-Paying Jobs in the U.S. and Largest Metro Areas â 2021 Study

Highest-Paying Jobs in the U.S. and Largest Metro Areas – 2021 Study

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IRS data shows that roughly 6% of American taxpayers earn $200,000 or more annually. While that figure includes income from investments, most reported income comes from salaries and wages. Across all occupations, the average worker earns $56,310 annually. In some of the highest-paying occupations, however, the average worker makes nearly three, four or even five times as much each year. These kinds of earnings in turn affect adjusted gross income (AGI), taxes and potentially savings. With that in mind, SmartAsset decided to take a closer look at some of the highest-paying jobs in America.

In this study, we identify the jobs with the best pay both nationally as well as across the 15 largest metro areas. Specifically, we look at average earnings data from the Bureau of Labor Statistics’ Occupational Employment and Wage Statistics to determine rankings at the national and metro area levels. For details on our data sources and further information about how we put together our findings, check out the Data and Methodology section below.

Key Findings

Specialty healthcare jobs stand out for their high pay. Data shows that 12 out of the 15 best-paid jobs in the U.S. are in specialty healthcare. Furthermore, eight of the highest-paying jobs in the largest metro areas are also in healthcare. Notably, national average earnings for each of these eight healthcare occupations exceed $220,000.
Chief executives earn the most in four out of the 15 largest metro areas. Chief executive is the highest-paying job in the New York, Los Angeles, Dallas and Houston metro areas. On average, they also make at least 22% more in those areas than the national average for this occupation, $197,840.

A National Look

Data from the Bureau of Labor Statistics (BLS) shows that the highest-paying job in the U.S. is that of anesthesiologist. In 2020, average earnings for anesthesiologists were $271,440. Surgeons (excluding ophthalmologists) follow closely behind with average earnings of almost $251,700 in 2020. Earnings for both occupations are more than four times higher than average earnings for all workers ($56,310).

Average earnings exceed $200,000 for seven additional healthcare roles:

Obstetricians & gynecologists
Orthodontists
Oral & maxillofacial surgeons
Psychiatrists
Prosthodontists
Family medicine physicians
General internal medicine physicians.

Of those, the largest occupation is that of family medicine physician. BLS data shows that there are about 98,600 family medicine physicians nationally, while there are less than 600 prosthodontists.

Other highest-paying jobs in the U.S. include:

Chief executives ($197,840)
Airline pilots, copilots & flight engineers ($186,870)
Computer & information systems managers ($161,730)

The occupation of computer & information systems manager employs the most workers (457,290), while that of airline pilot, copilot & flight engineer is the smallest of the three (employing less than 83,600 workers in 2020). The chart below compares the 15 highest-paying jobs in the U.S. to average earnings for all workers.

Highest-Paying Jobs in the 15 Largest Metro Areas

While specialty healthcare jobs rank at the top of the list nationally, data shows regional differences in some of the 15 largest metro areas where other occupations are the best paid.

This is the case with chief executives. Nationally, they have the 10th-highest paying job. But as we referenced earlier, this occupation ranks at the top in four of the 15 largest metro areas. Average earnings for chief executives exceed $242,000 in the following metro areas: New York, Los Angeles, Dallas and Houston. Chief executives in the Houston-The Woodlands-Sugar Land, Texas metro area earn the most on average ($260,450), but they are the most prevalent in Los Angeles-Long Beach-Anaheim, California, with roughly 9,830 employees in the field (amounting to almost 169 per every 100,000 workers).

The airline pilot, copilot & flight engineer job similarly ranks as the 12th-highest-paying job nationally, but is the top paid job in three metro areas:

Detroit-Warren-Dearborn, Michigan
San Francisco-Oakland-Hayward, California
Miami-Fort Lauderdale-West Palm Beach, Florida

In all three of those areas, average earnings for airline pilots, copilots & flight engineers are at least 29% higher than the national average for these workers ($186,870). In fact, average earnings for airline pilots, copilots & flight engineers in the Detroit metro area are 38.60% higher than the national average for those in this occupation.

The table below shows the highest-paying job in all 15 largest metro areas; metro areas are ranked according to average earnings figures.

Data and Methodology

Data for this report comes from the IRS and the Bureau of Labor Statistics’ May 2020 Occupational Employment and Wage Statistics data release. To find the highest-paying jobs in the U.S. and the 15 largest metro areas, we compared average (or mean) earnings across all occupations. We filtered out any occupation with “other” or “miscellaneous” in the title to maintain occupation specificity.

Note: We looked at mean earnings rather than median earnings, as median earnings data is not available for many occupations.

Tips for Maximizing Your Savings

Invest early. Many high-paid workers may be able to have an early retirement. To do this, it is important to take advantage of compound interest by investing early. Take a look at our investment calculator to see how your investment in a savings account can grow over time.
Contribute to a 401(k). A 401(k) is an employer-sponsored defined contribution plan in which you divert pre-tax portions of your monthly paycheck into a retirement account. Some employers will also match your 401(k) contributions up to a certain percentage of your salary, meaning that if you chose not to contribute, you are essentially leaving money on the table. Our 401(k) calculator can help you determine what you saved for retirement so far and how much more you may need.
Consider professional help. A financial advisor may be able to help you create a financial plan for your needs and goals. SmartAsset’s free tool matches you with financial advisors in five minutes. If you’re ready to be matched with advisors, get started now.

Questions about our study? Contact us at [email protected].

Photo credit: ©iStock.com/Andrey Shevchuk

Stephanie Horan, CEPF® Stephanie Horan is a data journalist at SmartAsset. A Certified Educator of Personal Finance (CEPF®), she sources and analyzes data to write studies relating to a variety of topics including mortgage, retirement and budgeting. Before coming to SmartAsset, she worked as an analyst at an asset management firm. Stephanie graduated from Williams College with a degree in Mathematics. Originally from Philadelphia, she has always been a Yankees fan and currently lives in New York.

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April 21, 2021

Where Women Are Most Successful â 2021 Edition

Where Women Are Most Successful – 2021 Edition – SmartAsset

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While there is still a long way to go, women have made significant strides over the last few decades to achieve greater equality in education, earnings and business ownership. According to data from the Bureau of Labor Statistics, in 2019, 57.4% of adult women participated in the workforce, which is still much less than 69.2% of men, but a big jump nevertheless over the 51.5% of participating women workers in 1980. It’s important to note that this rate has gone down since 2000, when women’s workforce participation reached 59.9%. Keeping this in mind, SmartAsset took a closer look at the U.S. cities where women are particularly successful in the workplace, and crunched the numbers to identify and rank them for the 2021 edition of this study.

To find where women are most successful, we compared the 200 largest cities in the country across the following metrics: percentage of women with a bachelor’s degree, median earnings for full-time working women, percentage of business owners who are women, housing costs as a percentage of women’s earnings and the percentage of full-time working women earning at least $75,000 per year. For details on our data sources and how we put all the information together to create our final rankings, check out the Data and Methodology section below.

This is SmartAsset’s fourth study on the cities where women are most successful. You can read the 2020 study here.

Key Findings

Western cities rank at the top. Five out of the top 10 cities in our 2021 study are in Western states, and three of those are in the top five. They include Bellevue, Washington; Seattle, Washington; Portland, Oregon; San Francisco, California; and Scottsdale, Arizona. Last year, only four western cities were in the top 10, and only one of those had made it into the top five.
Women lead in education. More than one in three women, an average 35.52% across our study, have earned at least a bachelor’s degree. This means that women are outpacing the national overall percentage of 33.12%.

1. Washington, DC

Washington, D.C. ranks in the top quartile of the study for all five of our metrics. The median earnings for full-time working women in the city is $72,750, the eighth-highest total overall. It also has the eighth-highest percentage of full-time working women earning at least $75,000 (49%). Additionally, 58.82% of the capital’s women older than 25 also have at least a bachelor’s degree, the 10th-highest percentage in our study.

2. Bellevue, WA

This Seattle, Washington suburb ranks second in our study for education, with 67.31% of Bellevue’s women older than 25 having at least a bachelor’s degree. The city also has the fourth-highest median earnings for full-time working women, $78,880. Bellevue ranks in the top quartile of the study for four out of five metrics. The city ranks within the top half of our study for affordable housing, with median housing costs amounting to 33.12% of the median earnings for women in Bellevue.

3. Seattle, WA

Women in Seattle, Washington have the sixth-highest education rate in our study, with 66.12% of those who are older than 25 having earned at least a bachelor’s degree. Full-time working women in this city earn $71,733, and 47.21% earn at least $75,000.

4. Portland, OR

Almost half of the businesses in Portland, Oregon (48.9%) are owned by women entrepreneurs, the 12th-highest rate for this metric in our study. This city also has the 18th-highest rate for our education metric, with 55.95% of women older than 25 having earned at least a bachelor’s degree. Portland ranks 79th out of 200 for affordable housing, as women there spend 32.46% of their earnings on housing costs.

5. Overland Park, KS

Overland Park, Kansas is the only Midwestern city in the top 10 of our study. Women in this city have the 13th-highest percentage for education, as 58.46% of those older than 25 have earned at least a bachelor’s degree. Overland Park also has the 24th-highest median earnings overall, with full-time working women making $56,570. The city ranks 66th out of 200 for women entrepreneurs, with 39.7% of Overland Park businesses owned by women.

6. San Francisco, CA

Full-time working women in San Francisco, California earn $80,163, the highest median earnings in our study. More than half of full-time working women (53.64%) earn at least $75,000, also ranking at the top of our list for this metric. While San Francisco falls to 76th place for affordable housing (women spend 32.23% of their income on housing costs), the city has the 12th-highest rate for the percentage of women older than 25 with a bachelor’s degree (58.47%).

7. Alexandria, VA

This suburb of Washington, D.C. has the fifth-highest percentage in the study of full-time working women earning at least $75,000 (50.83%). Full-time working women in Alexandria, Virginia also have the fifth-highest median salary, earning $75,803. Women in this city have the seventh-highest percentage for our education metric, with 65.94% of women older than 25 having earned a bachelor’s degree.

8. Pittsburgh, PA

Women in Pittsburgh, Pennsylvania spend only 24.4% of their income on housing, the fifth-best ranking for this metric in the study. This city ranks 28th for women entrepreneurs, with 44.0% of all businesses owned by women. Pittsburgh places 46th out of 200 for education, as 43.78% of women older than 25 have a bachelor’s degree.

9. Scottsdale, AZ

The median earnings for women working full-time jobs in Scottsdale, Arizona is $60,723, the 20th-highest in the study. The city also has the 15th-highest education rate overall, with 57.25% of women older than 25 having earned a bachelor’s degree. Additionally, Scottsdale has the 19th-highest percentage of full-time working women earning at least $75,000 (37.14%).

10. Madison, WI

Almost half of the businesses in Wisconsin’s capital city are owned by women – at 49.5%, this is the 11th-highest ownership percentage in our study. Madison also ranks 11th for education, with 58.59% of women older than 25 having earned a bachelor’s degree. The city ranks 72nd out of 200 for the percentage of full-time working women earning at least $75,000, at 20.27%.

Data and Methodology

To find the cities where women are most successful, SmartAsset analyzed the 200 biggest U.S. cities in the country across the following five metrics:

Percentage of women with a bachelor’s degree. This is the percentage of women older than 25 who have a bachelor’s degree.
Median annual earnings for full-time working women. This amount is the median earnings for women who work full time.
Percentage of business owners who are women. This is the percentage of self-employed people who are women working in their own incorporated business.
Housing costs as a percentage of earnings for full-time working women. This is the median annual housing costs divided by the median earnings for full-time working women.
Percentage of full-time working women with earnings of at least $75,000. This is the percentage of full-time working women who earn $75,000 or more per year.

Data for all metrics comes from the Census Bureau’s 2019 1-year American Community Survey.

First, we ranked each city in each of the metrics. We then found the average ranking for each city, giving all metrics equal weight except for the percentage of full-time working women earning at least $75,000 per year, which was given a half weight. We then ranked each city by that weighted average. The city with the highest average ranking received a score of 100 and the city with the lowest average ranking received a score of 0.

Tips for Staying on Track to Financial Success

Consider seeking expert advice. Everyone, regardless of age, gender or income, could potentially benefit from professional financial help from a financial advisor. SmartAsset’s free tool matches you with financial advisors in five minutes. If you’re ready to be matched with advisors that may be able to help you achieve your financial goals, get started now.
Don’t make taxes more taxing. Keep in mind that financial success may lead to an increased tax burden. Use SmartAsset’s free income tax calculator to see what you’ll owe Uncle Sam.
Think about homeownership carefully. Looking to put down roots in one of the above cities? You’ll want to start by looking for a home. Be honest with yourself about how much house you can afford so that you can plan your search accordingly.

Questions about our study? Contact [email protected]

Photo credit: © iStock/Mikolette

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April 15, 2021

Where Americans Are Most and Least Financially Literate â 2021 Edition

Where Americans Are Most and Least Financially Literate – 2021 Edition – SmartAsset

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Individuals with higher levels of financial literacy tend to adhere to better financial practices – such as having an emergency fund and planning for retirement – and are also more likely to build wealth further by investing in the stock market. Many Americans, however, lack financial knowledge and do not follow financial best practices. Less than 50% of American adults have set aside three months’ worth of emergency funds, only 41% have tried to figure out retirement savings needs and just 32% have investments apart from retirement accounts.

In light of Financial Literacy Month this April, SmartAsset took a closer look at financial literacy in the U.S. In this study, we discuss the growing number of states with financial education standards along with how adults fare when asked a series of economics and personal finance quiz questions. Using data from the Financial Industry Regulatory Authority (FINRA) Foundation, the Council for Economic Education and Experian, we then identify the states where residents are most and least financially literate. For details on our data sources and how we put all the information together to create our findings, check out the Data and Methodology section below.

Key Findings

A mismatch exists between perceived and tested financial literacy. The Financial Industry Regulatory Authority (FINRA) Foundation said in a recent national financial capability survey that roughly 71% of American adults believe they have a high level of financial literacy. However, when tested on personal finance topics, respondents struggle. On average, adults surveyed were able to answer only half of the literacy questions correctly.
Midwestern states perform well while Southern states fall behind. More than half of the 10 most financially literate states are in the Midwest: North Dakota, Minnesota, Nebraska, South Dakota, Kansas and Wisconsin. All of them rank in the top 10 states for our financial knowledge & education index. At the other end of the study, Southern states rank in the bottom 10: West Virginia, Louisiana, Georgia, Texas, Tennessee and Delaware. All of these except Tennessee rank in the bottom 20 states on our financial knowledge & education index.

Financial Education and Literacy in the U.S.

The number of states requiring that personal finance be included in their standards has grown substantially over the past two decades. According to data from the Council for Economic Education, only 21 states included personal finances in their K-12 standards in 1998, relative to 45 states in 2020. Notably, only some states additionally require that these standards be implemented by individual districts within the state. In 1998, 14 states required that personal finance K-12 standards be implemented, compared to 37 states in 2020.

Though the prevalence of financial education in the U.S. is growing, many adults struggle when asked to respond to questions covering fundamental concepts of economics and personal finance. The FINRA Foundation’s National Financial Capability Study asks respondents a series of six quiz questions, shown below. Multiple choice answers are shown below the questions. Correct answers are listed at the end of the study in the Data and Methodology section.

Mortgage Question: A 15-year mortgage typically requires higher monthly payments than a 30-year mortgage, but the total interest paid over the life of the loan will be less.
a) True
b) False
Interest Rate Question: Suppose you had $100 in a savings account and the interest rate was 2% per year. After 5 years, how much do you think you would have in the account if you left the money to grow?
a) More than $102
b) Exactly $102
c) Less than $102
Inflation Question: Imagine that the interest rate on your savings account was 1% per year and inflation was 2% per year. After 1 year, how much would you be able to buy with the money in this account?
a) More than today
b) Exactly the same
c) Less than today
Risk Question: Buying a single company’s stock usually provides a safer return than a stock mutual fund.
a) True
b) False
Compound Interest in Debt Question: Suppose you owe $1,000 on a loan and the interest rate you are charged is 20% per year compounded annually. If you didn’t pay anything off, at this interest rate, how many years would it take for the amount you owe to double?
a) Less than two years
b) At least two years but less than five years
c) At least five years but less than 10 years
d) At least 10 years
Bond Price Question: If interest rates rise, what will typically happen to bond prices?
a) They will rise
b) They will fall
c) They will stay the same
d) There is no relationship between bond prices and the interest rate

On average, adults surveyed were able to answer only half (i.e. 3.0) of the above questions correctly. In fact, only 7% of adults were able to correctly answer all six questions. About 34% and 40% of surveyed adults were able to answer five and four questions, respectively. The compound interest in debt and bond price questions were the most difficult for respondents. Less than one in three respondents were able to correctly answer either question. Meanwhile, more than 70% of adults correctly answered both the mortgage and interest rate questions.

Notably, there are distinct differences in performance on the financial literacy quiz questions across different demographics according to education, income and race. The average number of correct quiz questions among individuals earning $75,000 or more and college graduates is 3.6 and 3.8, respectively. In contrast, individuals earning less than $25,000 and those with a high school education or less answered an average 2.2 and 2.3 questions correctly. The chart below breaks out survey respondents by race, showing the average number of correct answers for each group.

States Where Residents Are Most Financially Literate

North Dakota ranks as the state where residents are most financially literate, taking the top spot on our financial knowledge & education index and the third spot on our financial practices index. According to the Council for Economic Education, the state of North Dakota requires that personal finance coursework be integrated into another course in the K-12 curriculum. In 2018, residents correctly answered about 55% of the National Financial Capability quiz questions discussed previously – almost five percentage points higher than the national average.

Minnesota and New Hampshire follow closely behind North Dakota. Minnesota is the top-ranking state on our financial practices index and ranks fifth on our financial knowledge and education index. Minnesota residents have the highest average credit score (739) of any state and the eighth-highest percentage of adults who report paying their credit card bill in full monthly (58.04%).

Six of the remaining seven states where residents are most financially literate are located in the Midwest and West. They include Nebraska, South Dakota, Kansas and Wisconsin in the Midwest, plus Utah and Colorado in the West. All of these states require that personal finance be included in K-12 standards and survey adults rank within the top 12 of the study on FINRA’s financial literacy six-question quiz.

States Where Residents Are Least Financially Literate

West Virginia ranks as the state where residents are least financially literate, with the lowest financial knowledge & education index and third-lowest financial practices index. West Virginia ranks in the bottom five states for three of the seven individual metrics we considered: percentage of adults that believe they have a high level of financial knowledge (67.37%), average percentage of personal finance quiz questions answered correctly (46.79%) and percentage of adults with a three-month emergency fund (42.53%).

Like in West Virginia, Nevada residents fall particularly far behind on our financial knowledge and education index. Though the state includes personal finance in its K-12 standards, only about two in three adults believe they have a high level of financial knowledge, the ninth-lowest of all 50 states and the District of Columbia. Additionally, the average percentage of correctly answered economics and personal finance quiz questions for Nevada is 49.14%, ranking within the bottom 15 of the study.

Across the eight other states where residents are least financially literate, three are not in the South: Indiana, Alaska and Pennsylvania. Of those three, Indiana ranks lowest for both the financial knowledge and education category as well as the financial practices category. Across the seven metrics, Indiana ranks in the bottom five states for its percentage of adults with a three-month emergency fund (44.05%) and percentage of adults paying their credit card bill in full monthly (49.82%).

Data and Methodology

To find the states where Americans are most and least financially literate, we examined data for all 50 states and the District of Columbia across two categories that include seven individual metrics:

Financial knowledge and education. For our financial knowledge and education index, we analyzed the state’s financial education score, percentage of adults that believe they have a high level of financial knowledge and percentage of correctly answered personal finance quiz questions. The state’s financial education score comes from the Council for Economic Education. Data for the other two metrics comes from the Financial Industry Regulatory Authority (FINRA) Foundation’s 2018 National Financial Capability Study.
Financial practices. For our financial practices index, we analyzed average credit score, percentage of adults with a three-month emergency fund, percentage of adults paying their credit card bill in full monthly and percentage of adults regularly contributing to an IRA or 401(k). Average credit score figures come from Experian. Data for the other three metrics comes from the Financial Industry Regulatory Authority (FINRA) Foundation’s 2018 National Financial Capability Study.

We created our final rankings by first ranking each state for each individual metric. Then we averaged the rankings across the two categories listed above. For each category, the state with the highest average ranking got a score of 100. The state with the lowest average got a score of 0. Finally, we created our final ranking by finding each state’s average score across the two categories.

The answers to the FINRA Foundation NFCS quiz questions are as follows:

Mortgage Question – a) True
Interest Rate Question – a) More than $102
Inflation Question – c) Less than today
Risk Question – b) False
Compound Interest in Debt Question – b) At least two years but less than five years
Bond Price Question – b) They will fall

Tips for Improving Your Finances

Take advantage of compound interest. One of the most important things to note about saving is that it helps to start early. Waiting to invest can potentially decrease your total return on a potential investment. Compound interest is interest that’s generated from existing earnings. In other words, when you put money into a savings account earlier, the interest compounds. As a result, you earn interest on the money you initially invested as well as the interest that money has already made. To see how this works, take a look at our investment calculator.
Some kind of retirement account is better than none. If a 401(k) is not available through your job, consider an IRA. 401(k)s are often valued more than IRAs since there is a possibility that your employer will match your contributions to the plan up to a certain percentage of your salary. This means that if you choose not to contribute, you are essentially leaving money on the table. However, if your employer does not offer a 401(k) plan, an IRA is another great option. In 2020, the IRA contribution limit is $6,000 for people under 50 and $7,000 for people age 50 and older.
Consider working with a financial advisor. Investing and planning for retirement are complicated and difficult tasks. A financial advisor could help you manage your money smartly. SmartAsset’s free tool matches you with financial advisors in five minutes. If you’re ready to be matched with local advisors that may be able to help you achieve your financial goals, get started now.

Questions about our study? Contact us at [email protected].

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April 8, 2021

Fastest-Growing and Fastest-Disappearing Jobs in Each State â 2021 Edition

Fastest-Growing and Fastest-Disappearing Jobs in Each State – 2021 Edition – SmartAsset

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It’s no secret that the U.S. unemployment rate peaked at 14.7% in April 2020, as a result of the COVID-19 outbreak — up from a pre-pandemic rate of just 3.5% in February 2020. As the job market continues to rebound with the vaccine rollout and the recent recent wave of federal aid, which could help many Americans prepare for financial emergencies and boost their savings, Americans looking to be strategic about their job searches would do well to examine employment trends over the last few years to see where the most robust opportunities may exist. Given that some sectors have seen more expansion while others shrank — with varied changes depending on location — SmartAsset took a closer look at the fastest-growing jobs and the fastest-disappearing jobs in each state.

This is the fifth version of SmartAsset’s study of the fastest-growing jobs in each state. Check out the 2020 version here.

To do this, we looked at information from the Bureau of Labor Statistics (BLS) for 2016 and 2020 for all 50 states. It should be noted that the 2020 data only partially accounts for the effects of the COVID-19 pandemic as responses were collected from November 2019 to May 2020. For details on our data sources and how we put all the information together to create our analysis, check out the Data and Methodology section below.

Key Findings

Education jobs are both increasing and disappearing, depending on location, but growth is more robust than decline. Jobs that fall within the broader category of education, training and library occupations comprise many of the fastest-growing and the fastest-disappearing jobs across the 50 states. These jobs are the fastest-disappearing job type in eight states and the fastest-growing job type in seven states. In the states where these are the fastest-disappearing jobs, they saw an average decline of 71.57% (with the steepest decrease at 82.61% for secondary school career/technical education teachers in Montana). In states where these are the fastest-growing jobs, they saw an average increase of 276.75% (with a high of 466.67% for postsecondary agricultural sciences teachers in Illinois).
Jobs are growing almost 4.5 times faster than they are shrinking. The average increase for the growing jobs in this study is 333.00%, while the average rate of shrinkage was only 74.89%.

The Fastest-Growing Jobs in Each State

Education is the leading industry for growing occupations nationwide (even though it is an industry that has seen steep decline in particular states). All told, seven states in this study have occupations in education at the top of their list. As an example, postsecondary nursing instructors make up the fastest-growing occupation in Alaska. In Nebraska, foreign language and literature teachers have grown faster than any other occupation, and in Oklahoma, archivists have outgrown all other jobs.

There are two different job types that are the fastest-growing occupations in multiple states. Bailiffs are the fastest-growing job in both Kansas and Maryland, while psychiatric technicians are the fastest-growing occupation in Nevada and New Jersey (as well as the District of Columbia).

The state with the top fastest-growing occupation is California, where the number of hoist and winch operators (who use these machines to lift and pull loads using power-operated cable equipment) has grown by more than 1,487%.

The Fastest-Disappearing Jobs in Each State

Office and administrative support occupations are the fastest-shrinking jobs in 10 different states. Some of the specific occupations that are shrinking include:

Meter readers for utilities in California
Word processors and typists in Delaware
Correspondence clerks in Florida
Proofreaders and copy markers in Washington
File clerks in New Hampshire

There are five other occupations which are the fastest-shrinking jobs in more than one state:

Photographic process workers and processing machine operators in Alabama, Ohio and Pennsylvania
Word processors and typists in Delaware, Missouri and Mississippi
Career/technical education teachers in Arizona and Montana
Bailiffs in Colorado and Utah
Library technicians in Vermont and Rhode Island

In Idaho, the number of demonstrators and product promoters has shrunk by more than 88%, the biggest drop in this study.

Data and Methodology

To find the fastest-growing and fastest-disappearing occupations for each state and the District of Columbia, we looked at employment data from 2016 and compared it to 2020. The 2020 data only accounts for the effects of the COVID-19 pandemic in part as responses were collected from November 2019 to May 2020. We filtered out any occupation for which the standard error for the estimated number of people employed in the occupation was greater than 20. We also filtered out any occupation with “other” in the title. To rank the occupations, we considered the percentage change in people employed in each occupation during this period.

All data, including earnings data, comes from the Bureau of Labor Statistics’ Occupation Employment Statistics.

Financial Planning Tips for Workers

Need advice for a career change? If you are thinking about changing jobs, a financial advisor can help you manage multiple retirement accounts from different employers and create a financial plan to keep your retirement and investing goals on track. SmartAsset’s free tool connects you with financial advisors in five minutes. If you’re ready to be connected with advisors get started now.
Taxes don’t have to be taxing. A career change may end up being what is best for some people. With that, you’ll likely have a new salary. See how much of it you can expect to give to the government using SmartAsset’s free tax calculator.
Use your budget to prepare for hard times. A budget can be a great tool for planning for unexpected expenses. You can use the budget to set up an emergency fund you can rely on if you lose your paycheck for a period of time.

Questions about our study? Contact [email protected]

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March 25, 2021

How COVID-19 Has Impacted Long-Term Job Growth â 2021 Study

How COVID-19 Has Impacted Long-Term Job Growth – 2021 Study – SmartAsset

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While many economists believe that the U.S. economy will return to pre-pandemic levels by late 2021, they are less confident that the job market will bounce back as quickly. According to February data from the National Association of Business Economics, 82% of economic forecasters surveyed expect real GDP to return to pre-COVID-19 recession levels sometime in 2021. By contrast, only 59% of respondents anticipate the total number of workers (excluding farm workers) will return to pre-pandemic levels in 2023 or later. As Americans scramble to boost their savings and map out their job prospects during the pandemic, SmartAsset analyzed data from 720 occupations to project the long-term impact of COVID-19 on the job market.

In this study, we use data from the Bureau of Labor Statistics (BLS) to examine the coronavirus pandemic’s long-term impact on specific occupations. The BLS annually publishes 10-year growth projections for all industries and jobs in the U.S. After publishing 2019-2029 projections in the fall of 2020 that did not capture the effects of the pandemic, the BLS issued alternate scenarios that model how jobs might be impacted if COVID-19 continues to have either a moderate impact on the economy, or a strong one. We compare pre-pandemic and strong pandemic impact projections to determine the jobs that could be affected most positively or negatively by COVID-19. For details on our data sources and how we put all the information together to create our findings, check out the Data and Methodology section below.

Key Findings

Almost three million less jobs. Prior to the COVID-19 pandemic, the BLS projected that six million jobs would be added to the U.S. economy from 2019 to 2029. In their revised strong pandemic impact scenario, less than 3.1 million jobs will be added over that time. With a total of about 163 million workers in 2019, the strong pandemic impact scenario represents an almost two percentage point drop in the preliminary 10-year employment growth projection, from 3.7% to 1.9%.
About four in five jobs may experience lower 10-year job growth due to COVID-19. Of the total 720 occupations we considered, strong pandemic impact projections are lower than pre-pandemic estimates for 560 of them, or about 78%. BLS data shows there is no difference between pre-pandemic and strong pandemic impact projections for 50 jobs (6.94%) and that 110 jobs (15.28%) may see increased growth than previously expected.
Restaurant, lounge, coffee shop and bar jobs face the most uncertainty. The BLS’ moderate impact scenario assumes that increased remote work is the primary change in the U.S. economy. However, its strong impact scenario accounts for more widespread and permanent changes to consumer and business behavior, whereby both consumers and businesses continue to limit human interaction. As a result, many of the occupations with the largest negative differences between pre-pandemic and strong pandemic impact projections are concentrated in service industries. The three jobs with the largest decreases in expected job growth are restaurant, lounge & coffee shop hosts and hostesses (8.2% to -18.0%); bartenders (5.9% to -13.8%) and waiters and waitresses (3.7% to -12.9%).

Jobs Most Likely to Be Positively Affected

Two occupations that focus on the research of diseases – epidemiologists and medical scientists – rank as the jobs most likely to be positively affected. Prior to COVID-19, the BLS predicted that over the next 10 years the occupations of epidemiologists and medical scientists would grow by 4.6% and 6.1%, respectively. But now the BLS predicts that they will grow by 31.0% and 28.9%, respectively, in the moderate pandemic impact scenario and by 31.2% and 30.7%, respectively, in the strong pandemic impact scenario.

Three other life, physical & social science occupations rank in the top 10 jobs most likely to be positively affected, reflecting the likelihood that more lab research will continue over the next decade. They are biochemists & biophysicists, microbiologists and biological technicians. Projections for all three jobs were more than four percentage points higher in the moderate pandemic impact scenario and more than five percentage points higher in the strong pandemic impact scenario than pre-pandemic projections.

The expansion of remote work will drive demand for information technology (IT) and computer-related occupations, particularly ones involved in IT security, as noted by the BLS. With the change in demand, the remaining five occupations in our top 10 are all computer & mathematical occupations:

Information security analysts
Web developers and digital interface designers
Network and computer systems administrators
Computer network architects
Database administrators and architects

Information security analysts handle IT for a variety of business and financial companies. Computer network architects design and build communication networks, while network and computer systems administrators are responsible for the day-to-day operation of computer networks.

Jobs Most Likely to Be Negatively Affected

Job growth estimates dropped more than 10 percentage points for 12 jobs. Beyond the three service industry occupations listed above – restaurant, lounge & coffee shop hosts and hostesses; bartenders as well as waiters and waitresses – other jobs affected this drastically include receptionists, flight attendants and cashiers. Across all 12 jobs, flight attendants and restaurant cooks are the only two with expected positive job growth in the strong pandemic impact projections, despite the growth rate being lower than initially projected. Prior to COVID-19, the BLS predicted that over the next 10 years the occupations of flight attendants and restaurant cooks would grow by 17.3% and 23.1%, respectively. The BLS predicts that they will grow by 9.2% and 13.9%, respectively, in the moderate pandemic impact scenario and by 3.7% and 10.9%, respectively, in the strong pandemic impact scenario.

Notably, there are large differences between the moderate and strong pandemic impact scenarios for many of the jobs likely to be negatively affected. For example, in the strong pandemic impact scenario, the number of bartenders may decline by almost 14% from 2019 to 2029. By contrast, BLS projections show that the number of bartenders may only decline by 2.1% over the next 10 years in the moderate pandemic impact scenario. The table below shows the top 20 jobs most likely to be negatively affected by the continuation of COVID-19 and its economic effects.

Data and Methodology

Data for this report comes from the Bureau of Labor Statistics’ (BLS) employment projections. We considered initial 2019-2029 projections that do not account for COVID-19 along with two alternate scenarios: a moderate impact scenario and a strong impact scenario. The alternate scenarios identify occupations whose employment trajectories are subject to higher levels of uncertainty. The BLS does not intend them to be precise estimates of employment change over the projection period.

To rank the jobs most likely to be positively and negatively affected by COVID-19, we compared pre-COVID-19 pandemic and strong pandemic impact scenario projections for a total of 720 occupations. We calculated the percentage point difference between those two projections. A positive difference indicates that strong pandemic impact projections are higher than pre-COVID-19 pandemic projections and that those jobs are more likely to be positively affected. A negative difference indicates that strong pandemic impact projections are lower than pre-COVID-19 pandemic projections and that those jobs are more likely to be negatively affected. Though we did not use the moderate impact scenario numbers in ranking occupations, we used them qualitatively to evaluate less severe lasting effects of the pandemic on certain jobs.

Tips for Improving Your Savings in Preparation for a Financial Downturn

If possible, keep your budget top of mind. One of the best ways to save more, and bolster your emergency savings if you can, is through budgeting. Our budget calculator can help with this. Beyond looking at how much you spend each month and what six months of expenses would look like, you can see how cutting back on discretionary expenses can increase your savings rate.
Consider professional help. A financial advisor can help you make smarter financial decisions to be in better control of your money and navigate the current market. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with financial advisors in five minutes. If you’re ready to be matched with advisors, get started now.

Questions about our study? Contact us at [email protected].

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March 23, 2021

Most Livable Small Cities in the U.S. â 2021 Edition

Most Livable Small Cities – 2021 Edition – SmartAsset

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Almost one in two Americans (48%, to be exact) prefer to live in a town or rural area, according to a 2020 Gallup survey – up from 39% in 2018. And while 27% still say that they want to live in a city, almost two-thirds of that group (16%) prefer a small city to a big one. The coronavirus crisis has also made places with low population densities more appealing, and small cities can offer the energy and creativity of urban life while boosting your savings in an affordable community. SmartAsset compared almost 300 cities with populations between 65,000 and 100,000 to identify and rank the most livable small cities in our 2021 study.

We analyzed data from 291 cities across the following metrics: concentration of entertainment establishments, restaurants, bars and healthcare establishments, Gini coefficient (a measure of income inequality), home affordability, housing costs as a percentage of median income, percentage of residents below the poverty line, unemployment rate percentage of residents without health insurance and average commute time. For details on our data sources and how we put all the information together to create our final rankings, check out the Data and Methodology section below.

This is SmartAsset’s fourth study on the most livable small cities. Read the 2020 study here.

Key Findings

Midwest ranks at the top. Eight out of the top 10 cities in this study are located in Midwestern states, with two in Missouri, two in Wisconsin, two in Indiana and two in Iowa. All eight of these cities rank within the top 70 (out of a total 291) for strong home affordability and within the top 60 of all cities for their low Dec. 2020 unemployment rate. The other two spots in the top 10 are claimed by cities in New York and Texas.
Unemployment tracks nationally. In December 2020, the national unemployment rate was 6.7%. That’s the exact same as the average unemployment rate in the small cities we analyzed for this survey, so living in a small city doesn’t appear to be a major factor when it comes to the availability of work. The lowest unemployment rate we found was 2.1% in Ames, Iowa.

1. O’Fallon, MO

Just over 30 miles away from St. Louis, O’Fallon, Missouri leads our study as the most livable small city in America. The city ranks 11th for low income inequality, with a Gini coefficient of 0.36. In addition, it ranks 30th for its relatively low proportion of residents living below the poverty line, at 4.0%. Median housing costs equal just 16.93% of median household income in O’Fallon, ranking 19th for that metric in the study overall.

2. Oshkosh, WI

Oshkosh, Wisconsin is located 75 miles from Milwaukee and ranks 15th in our study for home affordability with a 2.39 ratio of home value to household income. County-level data shows that Winnebago County, where Oshkosh is located, has the highest concentration in the study of bars compared to all establishments (2.63%) and ranks 20th for entertainment establishments compared to all establishments (2.46%).

3. Sioux City, IA

Sioux City, Iowa ranks 11th for home affordability with a 2.25 ratio of home value to household income. This city also has the 14th-lowest unemployment rate in our study, at 3.4% in December 2020. According to county-level data, it also has the 11th-highest concentration of bars (1.29%).

4. Flower Mound, TX

Only 1.9% of Flower Mound residents live beneath the poverty line, the third-lowest rate for this metric in our study. The county in which this Texan city is located has the 14th-highest concentration of restaurants, 9.07% of all establishments. Median housing costs equal 17.43% of median household income in Flower Mound, the 21st-lowest ranking for this metric.

5. Eau Claire, WI

Eau Claire, Wisconsin has the third-highest concentration of bars in our study, at 1.89% of all establishments at the county level, and the third-fastest commuting time with an average length of 15.1 minutes. Eau Claire also ranks 22nd out of 291 for its high number of healthcare establishments, at 14.08% of all establishments.

6. Lafayette, IN

Lafayette, Indiana has the 13th-highest concentration of restaurants, at 9.13% of all establishments at the county level. This city also ranks 15th for its high concentration of healthcare facilities, at 14.30% of all establishments. But 14.6% of the residents in Lafayette live below the poverty line, ranking 200th out of all 291 cities we analyzed.

7. St. Charles, MO

Median housing costs amount to 16.33% of median household income in St. Charles, Missouri, ranking 15th in the study. St Charles has the 39th-highest concentration of healthcare establishments at the county level (13.44%) and the 55th-lowest Dec. 2020 unemployment rate (4.7%) – both top quintile rankings.

8. Ankeny, IA

Median housing costs in Ankeny, Iowa equal 15.72% of median household income, the seventh-lowest rate for this metric in the study. This city ranks 14th for its relatively high concentration of bars, making up 1.04% of all establishments, according to county-level data. But ranks 215th for its concentration of restaurants, which account for only 6.72% of all establishments at the county level.

9. Fishers, IN

Median housing costs equal 15.39% of median household income in Fishers, Indiana, ranking fifth for this metric out of all 291 cities we studied. The city had the second-lowest unemployment rate in the study, with just 2.7% in Dec. 2020. And only 2.5% of its residents live below the poverty line, 11th-lowest in this study.

10. Cheektowaga, NY

Cheektowaga, New York has a 7.6% unemployment rate for Dec. 2020 (the highest rate for this metric in the top 10). Despite this, only 3.3% of residents are uninsured (29th-lowest rate for this metric out of 291). Cheektowaga also ranks 19th for home affordability, with a 2.43 ratio of home value to household income.

Data and Methodology

To find the most livable small cities in America, SmartAsset compared 287 cities with at least 65,000 people but fewer than 100,000 across the following 10 metrics:

Concentration of entertainment establishments. This is the number of arts, entertainment and recreation establishments as a percentage of all establishments in a county. Data comes from the U.S. Census Bureau’s 2018 County Business Patterns Survey.
Concentration of bars. This is the number of bars as a percentage of all establishments in a county. Data comes from the U.S. Census Bureau’s 2018 County Business Patterns Survey.
Concentration of restaurants. This is the number of restaurants as a percentage of all establishments in a county. Data comes from the U.S. Census Bureau’s 2018 County Business Patterns Survey.
Concentration of healthcare establishments. This is the number of healthcare and social assistance establishments as a percentage of all establishments in a county. Data comes from the U.S. Census Bureau’s 2018 County Business Patterns Survey.
Gini coefficient. This is a statistical measurement of income inequality. A Gini coefficient of zero indicates total equality of wealth distribution, while a coefficient of one indicates total inequality of wealth distribution across groups. Data comes from the U.S. Census Bureau’s 2019 1-year American Community Survey.
Home affordability. This is the median home value divided by median household income. A lower ratio indicates that homes are more affordable and vice versa. Data comes from the U.S. Census Bureau’s 2019 1-year American Community Survey.
Housing costs as a percentage of household income. This is the median housing costs divided by median household income. Data comes from the Census Bureau’s 2019 1-year American Community Survey.
Percentage of residents below the poverty line. Data comes from the U.S. Census Bureau’s 2019 1-year American Community Survey.
Unemployment Rate. Data comes from the Bureau of Labor Statistics and is for December 2020. This is measured at the county level.
Percentage of residents without health insurance. Data comes from the U.S. Census Bureau’s 2019 1-year American Community Survey.
Average commute time. This measures a worker’s average commute time in minutes. Data comes from the U.S. Census Bureau’s 2019 1-year American Community Survey.

First, we ranked each city in each metric. Next, we found each city’s average ranking, with each metric receiving an equal weight. We used this average ranking to create our final scores. The city with the highest average ranking received a score of 100 and the city with the lowest average ranking received a score of 0.

It is important to note that our 2020 study on the most livable small cities in the U.S. did not include one of the metrics we used this year – the unemployment rate in each city. Due to the drastic changes in unemployment at the onset of the coronavirus pandemic, we decided to exclude that metric from last year’s analysis. We added it back into the equation for this year and considered the most recently available figures from the BLS, measured at the county level.

Tips for Managing Your Finances No Matter Where You Live

Professional advice can help you make the right moves. Interested in moving to one of these cities? A financial advisor can help you create a financial plan to reach your goals. SmartAsset’s free tool matches you with financial advisors in five minutes. If you’re ready to be matched with advisors that might be able to help you achieve your financial goals, get started now.
Forecast your mortgage costs. Buying a home is a serious proposition, and you need to make sure you are prepared. Use SmartAsset’s free mortgage calculator to see what your monthly payments could end up being.
Get a snapshot of your retirement timeline. For some people, work demands mean being in a big city for most of their career. In retirement, though, you may want to live a slower-paced life in a small city. Make sure you’re using a 401(k) or any other workplace retirement plan you have access to so that your retirement dreams can come true.

Questions about our study? Contact [email protected]

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Source: smartasset.com

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