If you’re contemplating a job change or angling for a salary increase, you may have questions about whether a $95,000 salary will sustain you. Consider that the typical worker in the U.S. earns around $63,795 a year, according to the Social Security Administration. A $95,000 annual paycheck is nearly 49% higher than that.
Let’s see where you’d fall on the earnings spectrum compared to others in the U.S. and also explore ways to budget a $95,000 annual salary.
Is $95K a Good Salary?
While not quite a six-figure salary, $95K is generally considered a good income for a single person. But whether that amount works for you depends largely on where you live and your personal standards. For example, you may find that a $95,000 salary goes further in Des Moines than Honolulu, which has a higher cost of living.
No matter where you live, a budget planner app can help you set customized budgets and categorize spending, so you can make the most of your income.
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Recommended: Average Salary in the U.S.
Average Median Income in the US by State in 2024
As in real estate, location is an important factor when it comes to salaries. Wages for the same job can vary widely from one state to another, driven largely by differing costs of living.
Here’s a look at the median household income in each state, per U.S. Census Bureau data.
State
Median Household Income
Alabama
$59,609
Alaska
$86,370
Arizona
$72,581
Arkansas
$56,335
California
$91,905
Colorado
$87,598
Connecticut
$90,213
Delaware
$79,325
Florida
$67,917
Georgia
$71,355
Hawaii
$94,814
Idaho
$70,214
Illinois
$78,433
Indiana
$67,173
Iowa
$70,571
Kansas
$69,747
Kentucky
$60,183
Louisiana
$57,852
Maine
$68,251
Maryland
$98,461
Massachusetts
$96,505
Michigan
$68,505
Minnesota
$84,313
Mississippi
$52,985
Missouri
$65,920
Montana
$66,341
Nebraska
$71,772
Nevada
$71,646
New Hampshire
$90,845
New Jersey
$97,126
New Mexico
$58,722
New York
$81,386
North Carolina
$66,186
North Dakota
$73,959
Ohio
$66,990
Oklahoma
$61,364
Oregon
$76,362
Pennsylvania
$73,170
Rhode Island
$81,370
South Carolina
$63,623
South Dakota
$69,457
Tennessee
$64,035
Texas
$73,035
Utah
$86,833
Vermont
$74,014
Virginia
$87,249
Washington
$90,325
West Virginia
$55,217
Wisconsin
$72,458
Wyoming
$72,495
Recommended: Highest Paying Jobs by State
Average Cost of Living in the US by State in 2024
How much you pay for necessities like housing, transportation, health care, and food can impact just how far your $95,000 salary will go. When figuring out whether $95,000 is a good salary for a single person, it can help to look at how much people in different states are spending on housing, food, health care, and other basics. The U.S. Bureau of Economic Analysis’ (BEA) list of personal consumption expenditures, below, compiles this information.
State
Personal Consumption Expenditure
Alabama
$42,391
Alaska
$59,179
Arizona
$50,123
Arkansas
$42,245
California
$60,272
Colorado
$59,371
Connecticut
$60,413
Delaware
$54,532
Florida
$55,516
Georgia
$47,406
Hawaii
$54,655
Idaho
$43,508
Illinois
$54,341
Indiana
$46,579
Iowa
$45,455
Kansas
$46,069
Kentucky
$44,193
Louisiana
$45,178
Maine
$55,789
Maryland
$52,651
Massachusetts
$64,214
Michigan
$49,482
Minnesota
$52,849
Mississippi
$39,678
Missouri
$48,613
Montana
$51,913
Nebraska
$37,519
Nevada
$49,522
New Hampshire
$60,828
New Jersey
$60,082
New Mexico
$43,336
New York
$58,571
North Carolina
$47,834
North Dakota
$52,631
Ohio
$47,768
Oklahoma
$42,046
Oregon
$52,159
Pennsylvania
$53,703
Rhode Island
$52,820
South Carolina
$46,220
South Dakota
$48,997
Tennessee
$46,280
Texas
$49,082
Utah
$48,189
Vermont
$55,743
Virginia
$52,057
Washington
$56,567
West Virginia
$44,460
Wisconsin
$49,284
Wyoming
$52,403
Recommended: Average Income by Age
How to Budget for a $95K Salary
No matter how much money you earn each year, it’s a smart idea to create a budget. One of the first steps you’ll want to take is to figure out how much money you have left after withholding for federal income taxes, Social Security taxes, and Medicare. On average, the take-home pay on a $95,000 salary is around $74,991.50, though that doesn’t include state taxes.
Once you’ve determined your after-tax income, consider using the 50/30/20 rule for budgeting. This means 50% of your income goes toward needs, 30% goes toward “wants,” and 20% goes toward savings or debt repayment beyond your minimum amounts.
Let’s say, for example, you live in Massachusetts. Your $95,000 salary would break down to $5,757 per month due to taxes (based on a 27.3% average tax rate and 35% marginal tax rate). Using the 50/30/20 rule, you’d put the following amounts in the corresponding pockets:
• 50% needs: $2,878.50
• 30% wants: $1,727.10
• 20% savings or debt repayment: $1,151.40
After you have your budget in place, a tool like an online money tracker can help you monitor your spending as well as keep tabs on your credit score.
Maximizing a $95K Salary
Whether you’re earning $95,000 as an entry-level salary or after several years on the job, there are ways to make the most of your income. Here are some strategies to consider:
• Build an emergency fund. Aim for a cushion of three to six months of living expenses.
• Max out your retirement savings account — and make sure you’re taking advantage of a company match, if one is available.
• Explore investing in securities that charge minimal fees.
• Work on improving your credit score, which can boost your chances of getting competitive interest rates.
Quality of Life with a $95K Salary
While it’s a highly subjective measure, “quality of life” typically refers to a combination of personal preferences, including job satisfaction, family life, health, and safety. How well you can live on your salary often boils down to your expenses and how and where you choose to spend your money.
By and large, many people with $95,000 salaries find they can live quite comfortably. However, if you spend more than you earn or rely on credit to fund your lifestyle, you may find you have trouble making ends meet on your income.
Is $95,000 a Year Considered Rich?
The Charles Schwab Wealth Survey reported that a national sample of Americans between the ages of 21 to 75 believe you need to amass $2.2 million to be considered wealthy. However, according to the same survey, Americans who say they feel wealthy have less than that — around a $560,000 net worth.
Note that it’s possible to accumulate wealth if you’re earning $95,000 a year, though it may take some time. Common strategies include relying on investing and compound interest to increase net worth, saving money, and setting money aside in a company retirement plan.
Recommended: Net Worth Calculator By Age
Is $95K a Year Considered Middle Class?
Middle class is defined as income that is two-thirds to double the national median income. By that definition, a middle-class household makes between $47,189 and $141,568, and $95,000 is in that range.
However, that’s for the nation. When you drill down to the city and state level, you see that the income required to be middle class varies. For instance, to be considered middle class in San Francisco, you’ll need to earn between $91,126 and $151,877. In Washington, D.C., middle class is defined as income that falls between $67,815 and $113,024.
Example Jobs that Make About $95,000 a Year
Many career types fall into the $95,000 salary range, including jobs for introverts. Here are some examples of careers you can pursue, which require a range of degree levels from associate to graduate:
• Financial Analyst: $99,890 per year
• Industrial Engineer: $99,380 per year
• Radiation Therapist: $98,300 per year
• Occupational Therapist: $96,370 per year
• Civil Engineer: $95,890 per year
• Architect: $93,310 per year
The Bureau of Labor Statistics offers an occupation finder in its Occupational Outlook Handbook, which you can sort by median pay over $80,000.
The Takeaway
Is $95k a good salary for a single person? By and large, yes, but your spending habits, budgeting skills, and local cost of living can all impact how far your money goes. With careful budgeting and saving, you can make the most of your income.
Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.
See exactly how your money comes and goes at a glance.
FAQ
Can I live comfortably making $95K a year?
Generally speaking, many people can live comfortably making $95,000 per year. However, it depends on several factors, including where you live, how much you spend, and where you put your money. Those who live within a budget feel the most comfortable with that salary.
What can I afford with a $95K salary?
Let’s target one of the most expensive assets most people own: a home. You may wonder how much house you can afford without stretching yourself.
Experts often suggest the 28/36 rule, which means that you should spend no more than 28% of your gross income on housing and no more than 36% on all your debt, which might include housing, student loans, car payment, credit cards, etc.
For example, according to the 28/36 rule on a $95,000 salary, you should spend no more than $2,216 on housing per month.
How much is $95K a year hourly?
A $95,000 salary breaks down to $45.67 per hour. This per-hour figure might not help you budget or understand your overall income, but it’s interesting to analyze.
How much is $95K a year monthly?
You’ll bring in $7,916.67 per month with a $95,000 per-year salary. It’s important to note that this is the general breakdown for that salary — your state may charge more in taxes and you may actually make less.
How much is $95K a year daily?
You’ll earn $365.38 per day with a $95,000 salary. Similar to your hourly rate, you might find this number difficult to help you budget or for use in a net worth calculator by age, but it’s interesting to know.
Photo credit: iStock/JLco – Julia Amaral
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The average salary across the United States sits at $63,795, per the Social Security Administration. So an income of $300,000 per year — more than four times that figure — is by most standards a great salary for a single person in 2024.
Of course, even a large amount of money can come up short if you don’t have a solid budget in place or if you lead a particularly expensive lifestyle.
Below, we’ll dive into the various considerations.
Is $300K a Good Salary?
If you’ve just been offered a job with this figure in its compensation package, you may be wondering, “Is $300,000 a good salary for a single person?”
The thing is, there’s really no one-size-fits-all answer to that question. While $300,000 per year is substantially more than most people — or even most U.S. households — make, whether or not it’s comfortable for you depends on your lifestyle choices and expectations.
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Median Income in the US by State in 2024
You may be wondering how much you make compared to your neighbors. Median yearly household income varies significantly by state, ranging from Mississippi’s $52,985 to Maryland’s $98,461. However, nowhere in America does the median household income come anywhere close to $300,000 per year.
State
Median Household Income
Alabama
$59,609
Alaska
$86,370
Arizona
$72,581
Arkansas
$56,335
California
$91,905
Colorado
$87,598
Connecticut
$90,213
Delaware
$79,325
Florida
$67,917
Georgia
$71,355
Hawaii
$94,814
Idaho
$70,214
Illinois
$78,433
Indiana
$67,173
Iowa
$70,571
Kansas
$69,747
Kentucky
$60,183
Louisiana
$57,852
Maine
$68,251
Maryland
$98,461
Massachusetts
$96,505
Michigan
$68,505
Minnesota
$84,313
Mississippi
$52,985
Missouri
$65,920
Montana
$66,341
Nebraska
$71,772
Nevada
$71,646
New Hampshire
$90,845
New Jersey
$97,126
New Mexico
$58,722
New York
$81,386
North Carolina
$66,186
North Dakota
$73,959
Ohio
$66,990
Oklahoma
$61,364
Oregon
$76,362
Pennsylvania
$73,170
Rhode Island
$81,370
South Carolina
$63,623
South Dakota
$69,457
Tennessee
$64,035
Texas
$73,035
Utah
$86,833
Vermont
$74,014
Virginia
$87,249
Washington
$90,325
West Virginia
$55,217
Wisconsin
$72,458
Wyoming
$72,495
Source: U.S. Census Bureau
Average Cost of Living in the US by State in 2024
Just as median income varies significantly depending on which state you’re in, so does the state-by-state cost of living. This means that $300,000 can go a lot further in, say, Arkansas than it would in California.
While these figures are just averages — and the state-wide cost of living can vary substantially depending on which city you live in — here’s the average cost of living in each of the 50 states:
State
Average Cost of Living
Alabama
$42,391
Alaska
$59,179
Arizona
$50,123/td>
Arkansas
$42,245
California
$60,272
Colorado
$59,371
Connecticut
$60,413
Delaware
$54,532
Florida
$55,516
Georgia
$47,406
Hawaii
$54,655
Idaho
$43,508
Illinois
$54,341
Indiana
$46,579
Iowa
$45,455
Kansas
$46,069
Kentucky
$44,193
Louisiana
$45,178
Maine
$55,789
Maryland
$52,651
Massachusetts
$64,214
Michigan
$49,482
Minnesota
$52,849
Mississippi
$39,678
Missouri
$48,613
Montana
$51,913
Nebraska
$37,519
Nevada
$49,522
New Hampshire
$60,828
New Jersey
$60,082
New Mexico
$43,336
New York
$58,571
North Carolina
$47,834
North Dakota
$52,631
Ohio
$47,768
Oklahoma
$42,046
Oregon
$52,159
Pennsylvania
$53,703
Rhode Island
$52,820
South Carolina
$46,220
South Dakota
$48,997
Tennessee
$46,280
Texas
$49,082
Utah
$48,189
Vermont
$55,743
Virginia
$52,057
Washington
$56,567
West Virginia
$44,460
Wisconsin
$49,284
Wyoming
$52,403
Source: U.S. Bureau of Economic Analysis
How to Live on $300K a Year
No matter what you earn, figuring out how to spend (and save) your money takes effort and planning. Although it may seem like, with a six-figure salary, you can just buy whatever you want, if you don’t take the time to lay out how much money you’re actually taking home each month — and how much needs to be set aside for regular, necessary expenses like housing, insurance, food, and utility bills — you could quickly find yourself eating into your savings or even spiraling into credit card debt.
A money tracker is a great way to get a bird’s-eye view of where your funds are really going. This can be a first step toward deciding where you want them to go, rather than letting them whisk themselves away.
How to Budget for a $300K Salary
Whether you’re earning an entry-level salary or sitting in the C-suite, a little bit of budgeting can go a long way. But how?
The first step in budgeting is to determine how much money you make each month, which, in the case of someone earning a $300,000 salary, is about $25,000 before taxes are taken out. Because state taxes can vary significantly, you’ll need to look at your own pay stubs or do the math to determine how much is left afterwards, also known as your “net” income.
Once you know your net income, you can begin to deduct your regular, expected expenses. These include your housing payment (like rent or a mortgage), insurance payments, utility bills, and other recurring regular expenses (like your Netflix subscription). You should also set aside a budget for required monthly expenses that may vary a bit but are still critical, like groceries and fuel, or transportation.
Now, you can subtract your monthly expenses from your monthly earnings to determine how much discretionary income you have to do with what you please, including setting aside at least some of it for savings.
Sounds like too much work to do this all on paper? Fortunately, there are plenty of budget planner apps that can make the process a breeze.
Maximizing a $300K Salary
Just because you earn a lot doesn’t mean you have to spend a lot. And if you’re careful with your over-average salary, you can save money for the future and help safeguard your lifestyle for the long run.
For example, if you saved just 10% of your $300,000 per year salary, that would be $30,000 per year into your emergency fund or investment account. Especially if you choose to invest it, that amount can really add up over a relatively short amount of time — increasing your overall net worth and potentially even giving you the opportunity to retire early!
Quality of Life with a $300K Salary
Because a $300,000 per year salary is so much higher than the average cost of living in most states, most people who earn this much will find themselves able to afford a very comfortable, high quality of living anywhere.
Of course, the money can still go further in some places than others. For instance, on $300,000, you might be able to afford a small mansion in Mississippi — or an 800-square-foot apartment in Manhattan.
Is $300,000 a Year Considered Rich?
Given that the average salary in the U.S. is about 21% of $300,000, yes, many would consider someone earning $300,000 per year by themselves to be rich.
However, in most states, you’d need to make substantially more than $300,000 per year to be in the top 1% of earners. The states where you’d come closest are West Virginia and Mississippi, where the top 1% earn at least $367,582 and $381,919 per year, respectively.
Is $300K a Year Considered Middle Class?
The amount of money you’d need to earn to be considered middle class varies depending on where you live. But according to the Pew Research Center, it’s between about $47,189 and $141,568 per year on average. Which is to say, no, $300,000 per year is not considered middle class in the vast majority of cities and scenarios.
Example Jobs that Make About $300,000 a Year
Don’t make $300,000 per year (yet), and curious about how to make the dream a reality?
You might consider opening your heart to cardiology, which, according to data compiled by SoFi, offers an average salary of $421,330 per year. Medical positions feature prominently among the top-paying jobs, with surgeons, radiologists, dermatologists, emergency medicine physicians, and anesthesiologists all earning more than $300,000 per year.
The Takeaway
A salary of $300,000 is substantially higher than the national average and certainly a “good” salary for a single person in 2024 by most peoples’ reckoning. That said, no matter how much you earn, bad financial habits can bite you in the long run, so don’t forget about your budget.
Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.
See exactly how your money comes and goes at a glance.
FAQ
Can I live comfortably making $300K a year?
While everyone’s standard of comfort is individual, given how much higher $300,000 per year is than the average U.S. salary, yes, most people would be able to live comfortably on $300,000 per year. Even for high earners, however, having a budget is important. Making a plan for your money helps ensure you know exactly where each dollar is going rather than watching them fly away on their own.
What can I afford with a $300K salary?
With a $300,000 salary, you could afford a lot of things, including, depending on your overall applicant profile, a home priced close to a million dollars. With a high salary and the opportunity to save up money, you could likely afford luxurious vacations or high-end toys and gadgets, too. Again, though, a higher-than-average salary doesn’t preclude you from overspending or going into debt, so be sure to make a budget that accounts for all your necessary and discretionary expenses.
How much is $300K a year hourly?
For those who work 40-hour weeks 50 weeks out of the year, a $300,000 salary comes out to an hourly rate of around $150.
How much is $300K a year monthly?
A salary of $300,000 per year, divided by 12 months, comes out to roughly $25,000 per month.
How much is $300K a year daily?
A gross annual income of $300,000 per year, divided by 365 days, comes out to about $821.92 per day. Of course, most people don’t work every single day of the year. As an estimate for the normal five-day work week, accounting for weekends and typical American public holidays, an employee might work about 250 days per year, in which case a $300,000 salary comes out to approximately $1,200 per day.
Photo credit: iStock/Dusan Atlagic
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*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
By most definitions, an annual salary of $90,000 is considered good. In fact, it’s quite a bit higher than the average salary nationwide, which is $63,795, according to the Social Security Administration. If you’re a single person and only supporting yourself, that income should allow you to cover the necessities with enough left over for saving and entertainment.
But just how far your money goes depends largely on factors like your spending habits, your financial obligations, and the cost of living in your area. If you earn $90,000 and live in San Francisco or New York, two of the priciest cities in the country, you may find yourself pinching pennies or living paycheck to paycheck. On the other hand, if you settle down in a more affordable location, such as Winston-Salem, NC, you should find you can live a more comfortable life on a $90,000 salary.
Is $90K a Good Salary?
While $90,000 a year is generally considered a good salary for a single person, whether that’s the case for you depends on your spending habits and financial situation. For example, if you have a lot of debt or live in a pricey area, you may find it more of a challenge to get by on that salary.
One good way to think about your salary is to look at where your money is currently going. Using a money tracker or other type of tool, make a list of your recurring expenses and see if your income is able to keep up. If it is, then that is a good sign that you are making a satisfactory salary for your situation.
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Recommended: U.S. Average Income by Age
Median Income in the US by State in 2024
There are different ways to think about a $90,000 salary. You can compare it to the average salary in the U.S. which as we mentioned earlier is $63,795. Or see how it stacks up against the median national salary, which was $59,384 in Q4 2023, according to the U.S. Bureau of Labor Statistics (BLS). In both cases, $90,000 far exceeds what a typical American worker earns in a year.
But how does that salary compare to what a typical household earns in a year? The answer varies widely by state, as the U.S. Census Bureau data below shows. For instance, Maryland has the highest median annual salary at $98,461 and Mississippi has the lowest, at $52,985 per year.
State
Median Household Income
Alabama
$59,609
Alaska
$86,370
Arizona
$72,581
Arkansas
$56,335
California
$91,905
Colorado
$87,598
Connecticut
$90,213
Delaware
$79,325
Florida
$67,917
Georgia
$71,355
Hawaii
$94,814
Idaho
$70,214
Illinois
$78,433
Indiana
$67,173
Iowa
$70,571
Kansas
$69,747
Kentucky
$60,183
Louisiana
$57,852
Maine
$68,251
Maryland
$98,461
Massachusetts
$96,505
Michigan
$68,505
Minnesota
$84,313
Mississippi
$52,985
Missouri
$65,920
Montana
$66,341
Nebraska
$71,772
Nevada
$71,646
New Hampshire
$90,845
New Jersey
$97,126
New Mexico
$58,722
New York
$81,386
North Carolina
$66,186
North Dakota
$73,959
Ohio
$66,990
Oklahoma
$61,364
Oregon
$76,362
Pennsylvania
$73,170
Rhode Island
$81,370
South Carolina
$63,623
South Dakota
$69,457
Tennessee
$64,035
Texas
$73,035
Utah
$86,833
Vermont
$74,014
Virginia
$87,249
Washington
$90,325
West Virginia
$55,217
Wisconsin
$72,458
Wyoming
$72,495
Average Cost of Living in the US by State in 2024
The cost of living in your area can heavily impact how well you’re able to live on your income. While high salaries and high costs of living tend to go together, there is not always a perfect correlation. A cost of living calculator can help you determine the expenses where you’re living now and where you might consider moving in the future.
In addition, the U.S. Bureau of Economic Analysis compiles a list of how much residents in each state spend on necessities like housing, utilities, food, and health care. That information, found in the chart below, can also be useful.
State
Personal Consumption Expenditure
Alabama
$42,391
Alaska
$59,179
Arizona
$50,123/td>
Arkansas
$42,245
California
$60,272
Colorado
$59,371
Connecticut
$60,413
Delaware
$54,532
Florida
$55,516
Georgia
$47,406
Hawaii
$54,655
Idaho
$43,508
Illinois
$54,341
Indiana
$46,579
Iowa
$45,455
Kansas
$46,069
Kentucky
$44,193
Louisiana
$45,178
Maine
$55,789
Maryland
$52,651
Massachusetts
$64,214
Michigan
$49,482
Minnesota
$52,849
Mississippi
$39,678
Missouri
$48,613
Montana
$51,913
Nebraska
$37,519
Nevada
$49,522
New Hampshire
$60,828
New Jersey
$60,082
New Mexico
$43,336
New York
$58,571
North Carolina
$47,834
North Dakota
$52,631
Ohio
$47,768
Oklahoma
$42,046
Oregon
$52,159
Pennsylvania
$53,703
Rhode Island
$52,820
South Carolina
$46,220
South Dakota
$48,997
Tennessee
$46,280
Texas
$49,082
Utah
$48,189
Vermont
$55,743
Virginia
$52,057
Washington
$56,567
West Virginia
$44,460
Wisconsin
$49,284
Wyoming
$52,403
How to Budget for a $90K Salary
While $90,000 can provide a good life for a single person, it’s still a smart idea to create a budget you’ll be able to follow. After all, no matter how high your income is, you can usually find things to spend it on. And without a budget, it can be easy to spend what you have mindlessly.
There are several ways to approach budgeting. One, the 50/30/20 budgeting method, is straightforward: Simply earmark 50% of your paycheck for necessities (such as housing, transportation, and food); 30% for wants (such as meals out and travel); and 20% for saving and paying down debt.
If you need help getting started, tools like a budget planner app can guide you through creating a budget, tracking spending, and even monitoring your credit.
Maximizing a $90K Salary
You may not be pinching pennies if you’re earning $90K a year, but you’re likely interested in getting the most out of your income. Here are some ideas to explore:
• Build up an emergency fund. Your rainy-day fund should have enough to cover three to six months’ worth of expenses.
• Pay down debt. Once your emergency fund is well established, turn your focus to paying off revolving debt.
• Invest in your future. Have a 401(k) retirement plan through your employer? Check your budget and see if you can afford to ramp up your monthly contributions.
Quality of Life with a $90K Salary
Because a $90,000 annual salary is higher than the average salary in the United States — and a generous entry-level salary for most fields — chances are you can have a good quality of life if you make that much money.
However, everyone’s financial situation is unique, and as mentioned above, different areas of the U.S. have higher or lower cost of living. Your quality of life with a $90K salary is likely to be higher in a state with a lower cost of living, like Iowa or Kentucky, than it is in a state with a high cost of living, such as California or Massachusetts.
Is $90,000 a Year Considered Rich?
There are many definitions for what constitutes being “rich.” Depending on yours, a single person who lives in an area with a low cost of living and earns $90,000 a year might be considered well-off. But it’s worth noting that many definitions of rich typically focus on your total assets rather than your annual salary.
In that case, it may make sense to calculate your net worth, which just involves subtracting your outstanding debts or liabilities from the value of your combined assets. If your assets are worth more than your liabilities, your net worth is positive. If your liabilities are greater than your assets, your net worth is negative.
Recommended: Net Worth Calculator by Age
Is $90K a Year Considered Middle Class?
Depending on where you live and your household size, you may be classified as middle class. According to the Pew Research Center, a middle-class household has an income between $47,189 and $141,568. A $90,000 salary is well within that range.
Example Jobs that Make About a $90,000 Salary
Salaries can vary dramatically depending on the level of experience and the area of the country you live in. With that in mind, here are some jobs that pay around $90,000 per year, according to the BLS:
• Registered nurse: $94,480
• Web developer: $92,750
• Psychologist: $92,740
• Agricultural engineer: $88,750
• Dental hygienist: $87,530
If you’re looking for more inspiration, you can also look at lists of the highest-paying jobs by state.
Recommended: 30 Best Jobs for Introverts
The Takeaway
While it’s not quite a six-figure salary, $90,000 for a single person is still higher than the average annual salary in the United States. Because of this, it can generally be considered a good salary for someone who is supporting only themself.
However, your cost of living and your overall financial situation will play a big role in determining your quality of life on a $90K salary. No matter what your salary, a smart first step in establishing a solid financial footing is to create and stick to a budget.
Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.
See exactly how your money comes and goes at a glance.
FAQ
Can I live comfortably making $90K a year?
Whether you can live comfortably making $90K a year will depend on a number of factors, including your local cost of living, financial obligations, and spending habits. That said, a single person with little to no debt who lives in an affordable area can likely be comfortable with such a salary.
What can I afford with a $90K salary?
While $90K is not quite a six-figure salary, it is close. As such, most single people with a $90K salary should be able to afford all of their necessities, along with some extras including saving for retirement.
How much is $90K a year hourly?
A $90,000 annual salary works out to around $43.27 an hour.
How much is $90K a year monthly?
If you earn $90K a year, your monthly income is roughly $7,500.
How much is $90K a year daily?
A $90,000 salary breaks down to approximately $375 per working day.
Photo credit: iStock/alvarez
SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.
*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Welcome to the charming city of Little Rock, where southern hospitality meets modern living. With its rich history, beautiful riverfront, and thriving arts scene, Little Rock offers a unique blend of tradition and progress. Residents here enjoy a laid-back lifestyle, friendly neighborhoods, and a strong sense of community. Whether you’re looking for a cozy apartment in Little Rock or a spacious home for rent, Little Rock has something for everyone.
In this ApartmentGuide article, we’ll cut to the chase, breaking down the pros and cons of living in Little Rock. Let’s get started and see what awaits in this gem of the South.
Fast facts about living in Little Rock
Population: Approximately 200,000 residents
Average rent: $868 per month for a one-bedroom apartment
Median home sale price: $265,000
Public transit: Rock Region METRO provides bus services throughout the city
Public parks: Over 60 parks and green spaces for recreation and relaxation
Annual tourists: Approximately 6 million visitors each year
Restaurants: Over 600, offering a variety of cuisines from around the world
1. Pro: Affordable cost of living
The cost of living in Little Rock is about 18% lower than the national average. Housing costs, in particular, are significantly lower, with the median sale price for a home in Little Rock around $265,000 and the average rent for a one-bedroom apartment in Little Rock about $868 per month, making housing 18% more affordable than the national average. Additionally, utilities are 8% less expensive, groceries are 2% lower, transportation costs are 11% below average, and healthcare costs are 12% less than the national average. This lower cost of living makes Little Rock an attractive option for individuals looking to stretch their budgets further. Residents can enjoy a comfortable lifestyle while benefiting from these cost savings.
2. Con: Limited public transportation
While Rock Region METRO provides essential bus services, the public transportation system in Little Rock is limited compared to larger cities. The city has a transit score of 19, a walk score of 33, and a bike score of 34. This means that most daily errands require a car, which can be inconvenient for those who prefer not to drive or do not own a vehicle. The spread-out nature of the city and limited service hours can make commuting challenging without a car.
3. Pro: Rich history and culture
Little Rock boasts a rich history and vibrant cultural scene. The city is home to several museums, historic sites, and cultural institutions, such as the Clinton Presidential Library, the Arkansas Arts Center, and the Historic Arkansas Museum. These attractions provide residents with numerous opportunities for educational and cultural enrichment. Additionally, Little Rock hosts a variety of festivals and events throughout the year, celebrating everything from music and arts to food and heritage.
4. Con: Hot and humid summers
Little Rock experiences hot and humid summers, with temperatures often soaring into the 90s°F. The intense heat and humidity can be uncomfortable and limit outdoor activities during the peak summer months. Residents need to be prepared for the weather with proper cooling systems and hydration strategies. While the city enjoys mild winters, the summer heat can be a challenge for those not accustomed to such conditions.
5. Pro: Outdoor recreational activities
Little Rock offers a wide range of outdoor recreational activities, thanks to its scenic location along the Arkansas River and proximity to the Ouachita Mountains. Residents can enjoy hiking, biking, fishing, and boating in the numerous parks and natural areas.
Popular outdoor spots in Little Rock
Pinnacle Mountain State Park
Riverfront Park
Two Rivers Park
Burns Park
Murray Park
These locations provide ample opportunities for fitness, relaxation, and enjoying the natural beauty of the region.
6. Con: Limited job market diversity
While Little Rock has a growing economy, the job market is somewhat limited in diversity compared to larger metropolitan areas. The city’s economy is heavily influenced by government, healthcare, and retail sectors. While these industries provide job opportunities, those seeking employment in more specialized fields may find fewer options available. The city’s smaller size can also limit career advancement opportunities for some professionals.
Top employers in Little Rock
University of Arkansas for Medical Sciences (UAMS)
Baptist Health
Dillard’s
Arkansas Blue Cross Blue Shield
Arkansas Children’s Hospital
7. Pro: Strong educational institutions
Little Rock is home to several respected educational institutions, including the University of Arkansas at Little Rock (UALR) and the University of Arkansas for Medical Sciences (UAMS). These institutions offer a wide range of programs and contribute to the city’s vibrant academic atmosphere. Additionally, Little Rock has a variety of public and private schools providing quality education for everyone.
8. Con: Limited shopping options
While Little Rock has a variety of local shops and boutiques, it lacks the extensive shopping options found in larger metropolitan areas. Residents often need to travel to nearby cities for certain retail needs or high-end shopping experiences. While local malls and shopping centers provide basic necessities, the selection can be limited compared to larger cities.
9. Pro: Community-friendly environment
Little Rock is known for its strong sense of community and Southern hospitality. The city hosts numerous events and festivals throughout the year, such as the Riverfest and the Arkansas State Fair, which bring residents together and foster a sense of camaraderie. Little Rock’s neighborhoods, such as Hillcrest, Heights, and the Quapaw Quarter, offer a variety of living environments with active community associations and local initiatives that enhance the quality of life.
10. Con: Limited nightlife
While Little Rock offers a variety of dining and entertainment options, its nightlife scene is not as vibrant as larger cities. The city has a more laid-back atmosphere, with fewer late-night venues and entertainment options. Residents seeking a bustling nightlife might find the options limited, though there are still plenty of local bars, breweries, and restaurants to enjoy. For those who crave more excitement, larger cities like Memphis and Dallas are within driving distance.
11. Pro: Historic charm
Little Rock’s rich history is reflected in its architecture and historic districts. The city is home to several well-preserved historic neighborhoods, such as the Quapaw Quarter, which features beautiful homes and tree-lined streets. Downtown Little Rock also boasts historic buildings and landmarks, including the Old State House Museum and the Robinson Center, adding to the city’s unique character and charm.
12. Pro: Culinary diversity
Little Rock is home to a diverse culinary scene, with a variety of restaurants offering cuisines from around the world. From Southern comfort food to international delights, the city has something to satisfy every palate. Food festivals, such as the Main Street Food Truck Festival and the Arkansas Cornbread Festival, showcase the city’s culinary creativity.
You just got a new job offer and are wondering if $110,000 is a good salary. The truth is that in many parts of the U.S., it can be, especially for a single person. In most cases, you can probably cover your basic expenses and have some left over for savings.
Of course, there are many factors to consider when thinking about whether $110,000 is a good salary for you. Let’s dive in.
Is $110K a Good Salary?
In most cases, $110,000 is a good six-figure salary for a single person. Even when you factor in the rising costs of housing, food, and transportation, you can still comfortably afford to live in most parts of the country.
However, if you’re in an area where the cost of living is higher, you may find that you can afford the basics but not have much left over for other goals like retirement or travel. That’s why it’s crucial to look at your current spending patterns and the cost of living in your area to discern whether earning $110,000 is enough for your needs. A money tracker can give you a snapshot of your finances and provide insights into your spending and budgeting.
Check your score with SoFi Insights
Track your credit score for free. Sign up and get $10.*
Median Income in the U.S. by State in 2024
According to the latest data available from the U.S. Census Bureau, here is the median household income for all 50 U.S. states:
State
Median Household Income
Alabama
$59,609
Alaska
$86,370
Arizona
$72,581
Arkansas
$56,335
California
$91,905
Colorado
$87,598
Connecticut
$90,213
Delaware
$79,325
Florida
$67,917
Georgia
$71,355
Hawaii
$94,814
Idaho
$70,214
Illinois
$78,433
Indiana
$67,173
Iowa
$70,571
Kansas
$69,747
Kentucky
$60,183
Louisiana
$57,852
Maine
$68,251
Maryland
$98,461
Massachusetts
$96,505
Michigan
$68,505
Minnesota
$84,313
Mississippi
$52,985
Missouri
$65,920
Montana
$66,341
Nebraska
$71,772
Nevada
$71,646
New Hampshire
$90,845
New Jersey
$97,126
New Mexico
$58,722
New York
$81,386
North Carolina
$66,186
North Dakota
$73,959
Ohio
$66,990
Oklahoma
$61,364
Oregon
$76,362
Pennsylvania
$73,170
Rhode Island
$81,370
South Carolina
$63,623
South Dakota
$69,457
Tennessee
$64,035
Texas
$73,035
Utah
$86,833
Vermont
$74,014
Virginia
$87,249
Washington
$90,325
West Virginia
$55,217
Wisconsin
$72,458
Wyoming
$72,495
Recommended: Average Income by Age
Average Cost of Living in the U.S. by State in 2024
As anyone who’s ever received a paycheck knows, your salary and the amount you actually take home after taxes differ. After deducting for federal income taxes, Social Security tax, and Medicare, the average take-home pay on a $110,000 salary is around $85,544 — and that doesn’t include state taxes.
With that in mind, looking at the average cost of living in different states can help you decide whether $110,000 is a good salary. In the chart below, you can see how much a typical resident of each state spends on basics like food, transportation, utilities, and housing.
State
Personal Consumption Expenditure
Alabama
$42,391
Alaska
$59,179
Arizona
$50,123/td>
Arkansas
$42,245
California
$60,272
Colorado
$59,371
Connecticut
$60,413
Delaware
$54,532
Florida
$55,516
Georgia
$47,406
Hawaii
$54,655
Idaho
$43,508
Illinois
$54,341
Indiana
$46,579
Iowa
$45,455
Kansas
$46,069
Kentucky
$44,193
Louisiana
$45,178
Maine
$55,789
Maryland
$52,651
Massachusetts
$64,214
Michigan
$49,482
Minnesota
$52,849
Mississippi
$39,678
Missouri
$48,613
Montana
$51,913
Nebraska
$37,519
Nevada
$49,522
New Hampshire
$60,828
New Jersey
$60,082
New Mexico
$43,336
New York
$58,571
North Carolina
$47,834
North Dakota
$52,631
Ohio
$47,768
Oklahoma
$42,046
Oregon
$52,159
Pennsylvania
$53,703
Rhode Island
$52,820
South Carolina
$46,220
South Dakota
$48,997
Tennessee
$46,280
Texas
$49,082
Utah
$48,189
Vermont
$55,743
Virginia
$52,057
Washington
$56,567
West Virginia
$44,460
Wisconsin
$49,284
Wyoming
$52,403
Source: U.S. Bureau of Economic Analysis
How to Live on $110K a Year
You can live relatively well on $110,000 a year as a single person — as long as you manage your expenses carefully. First, consider what your short- and long-term goals are. Do you want to have enough money set aside for a week-long vacation each year? Are you eager to be debt-free within a certain timeframe? Or do you want to max out your contributions to your employer-sponsored 401(k)?
Balancing these goals with your everyday expenses will help ensure you can afford the necessities while taking care of your future self.
How to Budget for a $110K Salary
Budgeting on a $110,000 salary is similar to how you would budget for other income thresholds. Consider the following strategies:
Determine Your Take-Home Pay
Assuming you make $110,000 gross, you’ll need to account for how much you’ll receive after taxes and other deductions are taken into consideration. For example, you may have to pay health insurance premiums (an average of $1,401 a year for an individual plan) or pretax retirement contributions (up to $23,000 per year). Let’s say you pay federal taxes and deductions, contribute the maximum to your 401(k), and pay the average amount for your health care, you’d be left with a take-home pay of around $61,143.
Bottom line: Once you have a clearer picture of what’s coming in, you can then budget appropriately for it. Tools like a budget planner app can help make the job easier.
Set Aside Money for Long-Term Savings
It’s fun to live in the moment, but it’s also important to think about the future. Consider using part of your income to start an emergency fund, and set aside money for larger expenses and goals. You may also want to look into savings vehicles like a high-yield savings account, which typically offers a higher interest rate than a traditional savings account.
Plan to Get Out of Debt
Using part of your salary to tackle your high-interest debt faster can be a good idea to free up funds for other pursuits. You can also consider options like refinancing or debt consolidation loans to help you reduce interest costs.
Maximizing a $110K Salary
Getting smart with your money means knowing how you can maximize the salary you earn. In general, you can aim to do so by spending only what’s necessary, investing so you can have a comfortable retirement, and saving.
You may want to consider moves like:
• Boosting your credit score to increase your chances of getting competitive interest rates
• Investing in securities that charge minimal fees
• Shopping around for loans to find the best rates and terms
• Finding a home that fits your budget
• Taking public transit when you can instead of driving a car
Quality of Life with a $110K Salary
You can have a good quality of life on a $110,000 salary depending on how you allocate your money. Even if you live in a higher cost of living area, there are ways to maximize the amount you earn to live well. Take the time to compare larger expenses like housing, insurance, and healthcare costs.
Recommended: Average Pay in the United States
Is $110,000 a Year Considered Rich?
Does earning $110,000 mean you’re considered “rich”? Well, the term is relative. It all depends on where you live and how you spend your money. For example, if you invest a good chunk of your income to help you increase your overall net worth and live in a safe area, some would consider that being rich. However, if you’re the only income earner in your family of six, then $110,000 per year is likely not enough to make you feel wealthy.
Is $110K a Year Considered Middle Class?
According to the Pew Research Center, middle-class workers earn a salary that’s two-thirds to double the national median income. By that definition, a middle-class household makes between $47,189 and $141,568, and $110k falls within that range. However, where you live will also factor into whether you’re considered middle class. That’s because different states have their own median household earnings.
Example Jobs That Make About $110,000 a Year
high-paying jobs that earn a median wage of $110,000 or more:
• Architectural and engineering managers
• Financial analysts
• Software developers
• Math and science postsecondary teachers
• Dentists and doctors
• Nuclear power reactor operators
The Takeaway
Earning $110,000 can mean you have the ability to live a good quality of life. Plus, it’s higher than the average salary in the U.S. That being said, you’ll still want to be mindful about where your money goes so you can achieve your financial goals and more.
Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.
SoFi helps you stay on top of your finances.
FAQ
Can I live comfortably making $110k a year?
It is possible to live comfortably making $110,000 per year. However, doing so largely depends on factors like whether you have dependents, where you live, and what types of necessities and luxuries you want.
How much is $110k a year hourly?
Assuming you work 40 hours per week, you’ll earn around $52.88 each hour.
How much is $110k a year monthly?
You will earn about $9,166.66 each month on a $110,000 annual salary.
How much is $110k a year daily?
Assuming you work five days a week, $110,000 per year salary equates to roughly $423.07 per day.
Photo credit: iStock/Jacob Wackerhausen
SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.
*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
For some workers, earning a six-figure salary can feel like clearing a major professional — and financial — hurdle. And generally speaking, $125,000 is considered a good income for a single person, especially one with no dependents.
However, your cost of living, existing debt, financial obligations, personal spending habits, and inflation could all impact how far your dollar goes. Here’s a closer look at how a $125K salary measures up.
Is $125K a Good Salary?
One way to determine whether a $125,000 salary is “good” is to compare it to what a typical worker makes. According to the latest data from the Social Security Administration, the average salary in the U.S. is around $63,795. And the national median household income is $74,580, according to the most recent U.S. Census Bureau Current Population Survey data for 2022. By most people’s measure, $125,000 per year would be considered a good salary.
But no matter how much money you bring home, tools like an online money tracker can help you monitor your spending and ensure you’re making progress on financial goals.
Check your score with SoFi Insights
Track your credit score for free. Sign up and get $10.*
Average Median Income in the U.S. by State in 2024
Wages differ by region, often due to varying costs of living per state (more on that in a minute). The chart below shows the median household income in every state, according to the latest data available from the U.S. Census Bureau.
State
Median Household Income
Alabama
$59,609
Alaska
$86,370
Arizona
$72,581
Arkansas
$56,335
California
$91,905
Colorado
$87,598
Connecticut
$90,213
Delaware
$79,325
Florida
$67,917
Georgia
$71,355
Hawaii
$94,814
Idaho
$70,214
Illinois
$78,433
Indiana
$67,173
Iowa
$70,571
Kansas
$69,747
Kentucky
$60,183
Louisiana
$57,852
Maine
$68,251
Maryland
$98,461
Massachusetts
$96,505
Michigan
$68,505
Minnesota
$84,313
Mississippi
$52,985
Missouri
$65,920
Montana
$66,341
Nebraska
$71,772
Nevada
$71,646
New Hampshire
$90,845
New Jersey
$97,126
New Mexico
$58,722
New York
$81,386
North Carolina
$66,186
North Dakota
$73,959
Ohio
$66,990
Oklahoma
$61,364
Oregon
$76,362
Pennsylvania
$73,170
Rhode Island
$81,370
South Carolina
$63,623
South Dakota
$69,457
Tennessee
$64,035
Texas
$73,035
Utah
$86,833
Vermont
$74,014
Virginia
$87,249
Washington
$90,325
West Virginia
$55,217
Wisconsin
$72,458
Wyoming
$72,495
Recommended: Highest Paying Jobs by State
Average Cost of Living in the U.S. by State in 2024
Want to see how the cost of living in your state compares to other places in the nation? The U.S. Bureau of Economic Analysis’ (BEA) list of personal consumption expenditures — which looks at how much residents in each state spend on necessities like housing, utilities, food, and health care — can be a helpful place to start. The latest data from BEA is in the chart below.
State
Personal Consumption Expenditure
Alabama
$42,391
Alaska
$59,179
Arizona
$50,123
Arkansas
$42,245
California
$60,272
Colorado
$59,371
Connecticut
$60,413
Delaware
$54,532
Florida
$55,516
Georgia
$47,406
Hawaii
$54,655
Idaho
$43,508
Illinois
$54,341
Indiana
$46,579
Iowa
$45,455
Kansas
$46,069
Kentucky
$44,193
Louisiana
$45,178
Maine
$55,789
Maryland
$52,651
Massachusetts
$64,214
Michigan
$49,482
Minnesota
$52,849
Mississippi
$39,678
Missouri
$48,613
Montana
$51,913
Nebraska
$37,519
Nevada
$49,522
New Hampshire
$60,828
New Jersey
$60,082
New Mexico
$43,336
New York
$58,571
North Carolina
$47,834
North Dakota
$52,631
Ohio
$47,768
Oklahoma
$42,046
Oregon
$52,159
Pennsylvania
$53,703
Rhode Island
$52,820
South Carolina
$46,220
South Dakota
$48,997
Tennessee
$46,280
Texas
$49,082
Utah
$48,189
Vermont
$55,743
Virginia
$52,057
Washington
$56,567
West Virginia
$44,460
Wisconsin
$49,284
Wyoming
$52,403
How to Budget for a $125K Salary
Since $125,000 is double or triple the cost of living in most states, you may find that the salary provides more than enough for what you need. Still, it’s a good idea to have a spending plan in place to help with things like starting an emergency fund, paying down debt, or making progress on short- and long-term financial goals.
One approach is the 50/30/20 budget, which suggests using 50% of your earnings to pay for your needs, such as housing, utilities, groceries, and healthcare costs. You would then spend another 30% on discretionary items such as entertainment, hobbies and travel, with the final 20% going toward savings and debt repayment.
Need help tracking your progress? Consider using a budget planner app, which allows you to create a budget, review spending, and monitor your credit score.
Maximizing a $125K Salary
Since someone earning $125,000 per year is receiving double or even triple the average income in most states, it’s quite possible to have a high quality of life at that income level. After all, it’s far more than what’s considered to be a good entry-level salary.
But there are ways for a single person to get even more from a six-figure salary. Here are a few strategies to consider:
• Build up an emergency fund. Not sure you have enough saved for a rainy day? A general rule of thumb is to have at least three to six months’ worth of basic living expenses socked away in the bank.
• Pay down your debt. If you’re carrying a lot of credit card debt — and you’ve already built up a comfortable emergency fund — focus on paying off your debt.
• Step up your retirement savings. If you have a 401(k) retirement plan with your employer, crunch the numbers and see if you can bump up your monthly contributions. You could possibly get an employer match as well, if one is available.
Is $125,000 a Year Considered Rich?
A single person with no dependents who earns $125,000 a year may find that they’re well on their way to affording the life they want. That said, people who live in an area with a high cost of living may find that $125,000 per year doesn’t go as far as they had hoped.
One way to consider if someone is rich is by looking at their net worth. Calculating net worth is fairly straightforward: It’s the value of all your combined assets minus any outstanding debts or liabilities. If your assets are worth more than your liabilities, you have a positive net worth. If your liabilities outweigh your assets, you have a negative net worth.
Recommended: Net Worth Calculator by Age
Is $125K a Year Considered Middle Class?
Middle class is defined as households with a salary that’s two-thirds to double the national median income. That means a middle-class household has an income that falls between $47,189 and $141,568. A $125,000 salary falls squarely in that range.
Example Jobs that Make About $125,000 a Year
There are many jobs that pay about $125,000 per year, including several in information technology (IT) such as senior Java developers, which are computer programmers, as well as data scientists and data architects. Other jobs include pharmacist, optometrists, sales managers, lawyers, and marketing managers. Some of the positions that offer $125,000 per year also would be ideal jobs for introverts.
The Takeaway
Is $125k a good salary? To help you answer that question, it can help to look at the average pay in the United States and in each state. Cost of living, personal spending habits, inflation, and individual debt load are also factors you may want to consider. However, by and large, a single person with no dependents who earns $125K per year should be able to afford the basics with enough left over for enjoyment and saving.
Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.
See exactly how your money comes and goes at a glance.
FAQ
Can I live comfortably making $125K a year?
A single person with no dependents should be able to live comfortably on a salary of $125,000 a year. However, just how well they can live on that income depends on a number of factors, including their cost of living and existing debt.
What can I afford with a $125K salary?
A salary of $125,000 should be enough to cover necessities, like housing, transportation, food, and healthcare, with discretionary funds potentially left over.
How much is $125K a year hourly?
If you work 40 hours a week for 50 weeks, and earn $62.50 per hour, then that will add up to $125,000 per year.
How much is $125K a year monthly?
A $125,000 annual salary works out to around $10,417 per month.
How much is $125K a year daily?
Generally speaking, a person who earns $500 per day and works 250 days per year can earn around $125,000 per year.
Photo credit: iStock/South_agency
SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.
*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Little Rock, Arkansas, is a city rich in history and culture, with each of its neighborhoods offering a unique charm and distinct lifestyle. The city has so many hidden gems, vibrant neighborhoods, and stunning seasons that it’s no wonder about 203,000 residents live here. In Little Rock, you’ll find that the average rent for a one-bedroom apartment is $868. If you’re looking to rent an apartment in Little Rock, you’re in the right place. We’ve gathered a list of the 7 most expensive Little Rock neighborhoods to rent an apartment in this year.
7 Most Expensive Neighborhoods in Little Rock
From historic luxury in the Heights to the midcentury charm of Boyle Park, there are plenty of exciting neighborhoods in Little Rock. Whether you’re looking for a luxurious home to rent in Little Rock or wondering where to live in the city, we’ve got you covered.
1. Heights 2. Capitol View – Stifft Station 3. Rock Creek 4. Downtown 5. River Market 6. Boyle Park 7. Parkway Place
Let’s jump in and see what these neighborhoods have to offer.
1. Heights
Average 1-bedroom rent: $1,217 Apartments for rent in Heights
Heights is the most expensive neighborhood in Little Rock, as the average rent for a one-bedroom unit is $1,217. This upscale area stands out for its picturesque, tree-lined streets and historic charm, boasting beautifully preserved early 20th-century homes alongside elegant modern residences. The Heights is known for its boutique shopping and dining, with local favorites like Heights Taco & Tamale Co., offering a unique twist on Southern cuisine, and Eggshells Kitchen Co., a specialty kitchen store that attracts cooking enthusiasts. Residents enjoy the serene Allsopp Park, a local gem with hiking trails, picnic areas, and tennis courts, providing ample outdoor recreation within walking distance. The Heights also features a vibrant social scene with art galleries, local coffee shops like Boulevard Bread Company. Getting around is convenient, with well-maintained sidewalks promoting a walkable lifestyle, and the neighborhood’s proximity to downtown allows for quick commutes by car or public transit.
2. Capitol View – Stifft Station
Average 1-bedroom rent: $975 Apartments for rent in Capitol View – Stifft Station
Capitol View – Stifft Station in Little Rock is a distinctive neighborhood known for its eclectic charm and historic character. The streets are lined with a mix of Craftsman bungalows and early 20th-century homes, creating a picturesque and inviting atmosphere. A standout attraction is the White Water Tavern, a beloved local music venue that hosts a variety of live performances and community events. Residents also enjoy the neighborhood’s proximity to the Arkansas River Trail, offering scenic routes for biking and walking. Public transportation is convenient, with several Rock Region Metro bus routes providing easy access to downtown and other parts of the city.
3. Rock Creek
Average 1-bedroom rent: $960 Apartments for rent in Rock Creek
With an average one-bedroom rent of $960, Rock Creek is the third most expensive neighborhood in Little Rock. The area is distinguished by its lush, wooded landscapes and well-maintained residential streets, creating a serene suburban atmosphere. The neighborhood is home to the beautiful Rock Creek Park, which offers extensive walking trails, playgrounds, and picnic areas, making it a favorite spot for families and outdoor enthusiasts. A highlight of the community is the Chenal Country Club, providing residents with a premier golfing experience and various social activities. Rock Creek boasts a variety of local eateries, like Maddie’s Place, where residents can enjoy Southern cuisine in a cozy setting. Getting around Rock Creek is convenient with easy access to major roads like Chenal Parkway, facilitating quick commutes to other parts of Little Rock.
4. Downtown
Average 1-bedroom rent: $922 Apartments for rent in Downtown
Downtown is the next most expensive neighborhood in Little Rock. The neighborhood is characterized by a mix of beautifully restored historic buildings and sleek, contemporary developments, creating a visually engaging streetscape. Key attractions include the Arkansas Museum of Fine Art, which offers world-class exhibitions and performances, and the Historic Arkansas Museum, showcasing the state’s rich heritage. Residents and visitors enjoy the Riverfront Park, a scenic area along the Arkansas River with trails, sculptures, and the iconic Junction Bridge pedestrian crossing. Getting around downtown is convenient, with the Rock Region METRO streetcar system offering easy access to key areas, along with well-maintained bike lanes and pedestrian-friendly streets encouraging walking and cycling.
5. River Market
Average 1-bedroom rent: $922 Apartments for rent in River Market
The River Market neighborhood of Little Rock stands out with its bustling streets and vibrant atmosphere, characterized by a mix of modern apartments and historic buildings. The area is home to the River Market Pavilion, a hub for local farmers and artisans offering fresh produce, handmade crafts, and delicious street food. Cultural attractions such as the Arkansas Museum of Discovery provide interactive exhibits that engage both children and adults, while the nearby Clinton Presidential Center offers insights into American history and politics. Residents and visitors enjoy scenic walks along the Arkansas River Trail, which provides stunning views of the river and skyline. Transportation within River Market is convenient, with the Rock Region METRO streetcars offering a charming and efficient way to navigate the neighborhood and connect to other parts of the city. The lively nightlife, art galleries, and annual events contribute to the unique appeal of the River Market, making it a standout neighborhood in Little Rock.
6. Boyle Park
Average 1-bedroom rent: $915 Apartments for rent in Boyle Park
Next up is Boyle Park, the sixth most expensive neighborhood in Little Rock. The centerpiece of the area is Boyle Park itself, a sprawling urban oasis featuring winding trails, picnic spots, and a serene creek that attracts nature lovers and families alike. The neighborhood is characterized by charming mid-century homes and cozy bungalows, giving it a welcoming and nostalgic feel. Local attractions include the War Memorial Stadium and the Little Rock Zoo, both just a short drive away, offering entertainment and recreational activities. Residents primarily get around by car, but the well-maintained bike lanes and pedestrian-friendly streets also encourage walking and cycling.
7. Parkway Place
Average 1-bedroom rent: $908 Apartments for rent in Parkway Place
Located west of downtown, Parkway Place is the next neighborhood on our list. One standout feature is the neighborhood’s proximity to the beautiful Boyle Park, where residents can enjoy hiking trails, picnicking areas, and a scenic creek. The community is also home to War Memorial Stadium, a historic venue hosting local sports events and concerts, adding a lively atmosphere to the area. Local dining gems like Trio’s Restaurant offer residents gourmet meals with a focus on fresh, seasonal ingredients. Getting around Parkway Place is convenient, with easy access to the Interstate 630, providing quick routes to downtown and other parts of the city. Additionally, the neighborhood’s pedestrian-friendly design and bike lanes make it easy for residents to enjoy a walk or bike ride to nearby attractions and amenities.
Methodology: Whether a neighborhood has an average 1-bedroom rent price over the city’s average. Average rental data from Rent.com in June 2024.
The Atlas Card, issued by Patriot Bank, offers a way for people with no credit history to establish their credit. You aren’t able to get into debt with this card. Instead, your spending limit is set to what Atlas determines you can afford, which is based on how much money you have in your account.
The Atlas Card earns cash back in certain spending categories and offers other perks you don’t often see with starter credit cards. However, it charges a monthly membership fee (which is also payable annually), making other credit-building cards without these fees more appealing.
Here are five things to know about the Atlas Card.
🤓Nerdy Tip
This Atlas Card isn’t the same as the Atlas Card from Lead Bank, an ultra-high-fee card with luxury perks. Nor is it connected to another Atlas Card, which is a travel rewards card from India-based Axis Bank.
1. It’s designed for those with no credit history
The Atlas Card boasts high approval rates of over 95% with no credit history required. To compare, the card’s website mentions data from the Consumer Financial Protection Bureau’s 2023 Consumer Credit Card Market Report stating that acceptance rates are around 20% for consumers in the subprime or deep subprime credit tiers.
There are geographic restrictions, however. As of this writing, the Atlas Card is only available to applicants who are residents of Alabama, Alaska, Arizona, Arkansas, Colorado, Connecticut, Florida, Georgia, Hawaii, Illinois, Iowa, Kansas, Kentucky, Maine, Massachusetts, Michigan, Minnesota, Missouri, Nebraska, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia, West Virginia, Wisconsin and Washington, D.C.
2. There are limits on what you can spend
The Atlas Card doesn’t assign you a credit limit the way more traditional cards do. Instead, it works with a deposit account held by Evolve Bank & Trust, which is funded by your existing bank account via Plaid, a service that connects accounts to other companies.
Your spending limit is determined by the amount of money you choose to deposit into your Atlas account, along with your income. You can’t spend more than you can afford to pay back, and you can set up autopay to ensure you pay bills on time. Atlas reports payment activity to the three main credit bureaus at the end of each month.
3. Certain purchases earn cash back
The Atlas Card earns cash back rewards that can vary based on three tiers (Gold, Blue and Platinum) you fall into depending on your ongoing spending and deposits into your Atlas account. You’ll earn:
Up to 3% cash back on gas, food delivery, coffee shops and more (no mention of what counts as “and more”).
5% cash back on subscriptions, including Netflix and Hulu.
Up to 10% cash back on purchases from 50,000+ stores (those stores are unspecified).
Up to 100% cash back on “Lucky Swipes,” which are essentially sweepstakes where you can randomly earn additional points on a purchase.
🤓Nerdy Tip
While any credit card can change its terms and conditions at any time, cards from financial technology companies sometimes undergo major changes unexpectedly. This can dramatically alter your experience as a cardholder.
4. There’s a membership fee
Cardholders must pay a fee of $8.99 per month (you can save $18.88 on fees by paying $89 annually). Ostensibly, this grants you access to the deposit account and some of the Atlas Card’s perks, which are mentioned below.
Other credit-building cards with linked deposit accounts and choose-your-own spending limits charge no annual fee. Secured credit cards require an upfront deposit, but many also lack an annual fee.
5. The card offers additional perks
In addition to cash-back rewards, the Atlas Card offers a bill negotiation feature to help you save on phone, internet and insurance bills. You can also get access to virtual cards you can use to pay for subscriptions, making it easier to cancel them when they’re no longer needed — or when the free trial ends.
The information provided on this website does not, and is not intended to, act as legal, financial or credit advice. See Lexington Law’s editorial disclosure for more information.
If you need to improve your credit health, you’re not alone. Millions of people have a bad credit score, often due to delinquencies, or late payments. According to a recent report from the New York Federal Reserve, credit card, and auto loan delinquencies are on the rise. Having poor credit can limit your financial options, but credit repair companies may be able to help.
Credit repair companies specialize in helping people fix their credit, but unfortunately, there are some companies that take advantage of people. It’s important to understand the laws of each state so you can protect yourself and choose the right credit repair company.
In this post, we teach you about credit repair laws for each state as well as the federal credit repair laws. Knowing your rights and the credit repair laws is the first step on your credit repair journey.
Credit repair laws for each state
In addition to federal laws, many states have laws that regulate the credit repair industry. The state consumer credit repair laws provide protection from companies that take advantage of people who are experiencing financial hardship. While many states have laws, there are some that don’t. Check the graphic below to see if your state is one of the few that doesn’t have specific laws for credit repair.
It’s helpful to know that the state credit repair laws are based on the state in which the credit repair organization is operating from. Not only must they comply with their state credit repair laws, but they must abide by federal laws as well.
Depending on the state, they may require that the credit repair company has:
A state registration requirement
A surety bond to cover potential damages to consumers
A required cancelation period after the consumer signs the contract
A refund period after the consumer signs the contract
Here is a list of each state and some specifics about their laws.
Credit Services Organization Act (UT. Code. §13-21-1 et seq.)
Yes
$100,000
5
10
Vermont
No state laws
N/A
N/A
N/A
N/A
Virginia
Credit Services Businesses Act (VA. Code. § 59.1-335.1 et seq.)
Yes
$50,000
3
10
Washington
Credit Services Organization Act (R.C.W. § 19.134 et seq.)
No
$10,000
5
10
West Virginia
Consumer Credit and Protection Act (W.V. Code Ch. 46A et seq)
Yes
$15,000
3
10
Wisconsin
Credit Services Organization (WI. Leg. § 422.501 et seq.)
Yes
$25,000
5
15
Wyoming
No state laws
N/A
N/A
N/A
N/A
Federal credit repair laws
There are many consumer protections for people in the United States, and some involve your credit. The primary credit repair law to familiarize yourself with is the Credit Repair Organizations Act (CROA). In addition to the CROA, you should also know about the Fair Credit Reporting Act (FCRA), which is what many credit repair companies use when helping their customers.
Credit Repair Organizations Act (CROA)
CROA dates back to 1996. The Federal Trade Commission (FTC) states that this act “prohibits untrue or misleading representations and requires certain affirmative disclosures in the offering or sale of ‘credit repair’ services.” The specifics of CROA state that the following are illegal:
Exaggerating or misrepresenting the service
Submitting false information to credit bureaus and data furnishers
Providing a new identity to clear your credit history
Charging customers up front
Requiring customers to waive their rights
Fair Credit Reporting Act (FCRA)
The Fair Credit Reporting Act (FCRA) is another federal law that helps ensure fair credit reporting practices for consumers. Credit repair companies work by utilizing the FCRA, so it’s helpful to understand what it says and how it works.
Some of your rights and protections according to the FCRA include:
You have the right to be told what’s in your file.
You must be told if any information in your file is being used against you.
You have the right to ask for your credit score.
Consumer reporting agencies must fix or remove inaccurate information.
Credit repair services are completely legal, but you’ll need to find credit repair companies that are operating under state and federal laws. The best credit repair companies follow these laws and can assist you with challenging errors on your credit report.
The following are some signs of a good credit repair company:
They don’t charge you up front
They don’t guarantee results
They don’t ask you to lie about your information to reporting agencies
Credit repair companies charge for their services, so it may be helpful to shop around and look at online reviews. When doing this, keep in mind that although a company may be the least expensive option, it may not provide the best services.
Work with a credit repair company who knows credit law
If you’re looking for a credit repair company that understands state and federal laws when it comes to your credit, work with Lexington Law Firm. We have a team of legal professionals who follow credit repair laws, and we also challenge credit reporting errors on your behalf.
In addition to providing you with regular updates about the credit repair process, we also provide various tools to help you better understand your credit health. To get started, sign up today.
Inside: The decision on where you live is a big life choice. Learn how an HCOL vs LCOL area will impact you financially. Plus find the cost of living city that fits for you.
HCOL. LOCL. MCOL. What do these acronyms mean and why should I care?
Back when I was trying to decide where to live, there wasn’t a big discussion about the high cost of living or low cost of living areas.
You just picked a city close to family or branched out to a new area. Were you drawn to the big city or not? Plain and simple.
Today, there are many tools at our disposal to try and figure out what is the best city to live in based on income, expenses, and the lifestyle that you desire.
In this post, you will see how to analyze what type of city you want to live in and see if it makes financial sense for you.
Why such the price difference between HCOL and LCOL?
In a low cost of living city, you can buy a house for $50,000. In contrast, a median home price in a high cost of living city can cost $1.5 million. This is a correlation between supply and demand in the market.
The more people who want to live in a certain area that has less available space will naturally drive up prices. Whereas most low cost of living areas, the supply is abundant since there is plenty of space to spread out and find your own neck of the woods for much less.
Here’s a quick comparison of HCOL vs LCOL vs MCOL.
New York City has the highest cost of living at 100, followed by Los Angeles and San Francisco. This graph highlights the difference in cost of living in these example cities.
HCOL Seattle, WA
MCOL Las Vegas, NV
LCOL Knoxville, TN
Cost of Living Index
85.57
69.33
63.26
2 Bed Apartment Rent
$2,724
$1,176
$788
Median Home Price
$826,200
$441,771
$256,188
Median Income
$92,263
$56,354
$33,229
Data from Nerdwallet, Census.Gov, and Numbeo
What is HCOL area Mean?
Simply put, HCOL means a high cost of living.
This type of acronym is to describe certain areas or cities where expenses that impact your budget the most, such as housing, food, and transportation, are more expensive than other areas.
When defining an HCOL area, it is a comparison of the cost of living based on other areas around other cities, states, and countries.
There is no hard line to define high cost of living since it is compared to the other cities.
Is it possible to live in a high cost of living area? Absolutely, it all depends on how you choose to live, the income you make, your lifestyle choices, and your savings percentage.
VHCOL are VERY high cost of living areas, such as Manhattan, Honolulu, San Francisco, Singapore, or Hong Kong.
This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.
Pros and Cons of HCOL
Just because an area is labeled HCOL does not mean that you shouldn’t call the city home and stay away from these areas.
There are plenty of advantages and disadvantages of living in a high cost city.
There are always drawbacks to living in a high cost of living area and you have to decide whether or not what works for you.
In order to make a solid decision on where the best place is for you to live, you need to know this information.
Advantages of HCOL City
Job Market is Solid
First of all, in HCOL cities, the job market is stronger, there are more jobs available, and typically those jobs have a higher paying threshold than other areas.
That is why many companies are attracted to these areas because they know the talent pool of potential employees is much stronger in high cost of living area versus other areas where there are not as many skilled workers.
Income is Higher
Since companies know they must pay their employees a fair wage living in a high cost of living area, incomes are higher to support the increased expenses.
This helps those municipalities collect more taxes, which feed back into the system to provide more for their residents.
More Opportunities
More opportunities abound in a high cost of living cities.
Not only in the job market but there is access to public amenities and conveniences. Some examples include museums, sporting events, transit, best medical services, endless entertainment options, quality restaurants, high-end shopping, and quick access to international airports.
Even better, you can find free entertainment each and every day that does not cost a penny. Here is a list of 101 things to do with no money.
There are many benefits of living in a high cost of living area just because their opportunities are endless. You will always find something to do and there is always stuff going on.
Better Schools
Typically, in your high cost of living cities, that is where you will find the better schools. This is in direct correlation to the job market and skilled workers.
These skilled workers tend to have a higher instance of college graduates and they tend to want the best for their children. As a result, the schools tend to be much better than you would find in other areas.
Higher Chance of Home Equity
Another advantage of big cities is the variety of neighborhoods you can find in a bigger city. You can find the type of house you want to live in and the diversity you crave.
While home costs are much higher, there is also a greater chance of income increasing your home equity much faster than other areas.
For example, in Michigan, you could pay $100,000 for the exact same house in 5-10 years since appreciation will not happen at the same rate as other cities. Whereas, if you look at some of the hot markets, like Denver, Phoenix, or Austin, the home prices have been skyrocketing.
Thus, if you live in those quickly appreciating housing areas, there is a higher chance to increase the value of your house.
Disadvantages Of HCOL Cities
Higher Basic Cost of Living – Specifically Housing
First, housing costs can break the bank. It is the biggest expense for any household.
If you were unable to secure a salary to justify the housing cost, it makes it nearly impossible to be able to afford to live in a high cost of living area.
This is where you would have to get creative and look for housing subsidies or other means to stretch your housing budget.
Harder to Find Houses
Another con of a high cost of living areas is it is much harder to find housing! House and rent prices are higher, jobs are tougher to find where there’s opportunities abound, and you may feel like you are searching for a needle in a haystack.
You need to have the right opportunity to find the proper house for you. If you are looking at buying, you need things to line up properly and in your favor.
Stretch Yourself Too Far Financially
Since incomes tend to be much higher, many people find the urge to spend more discretionary income.
In many cases, this means that the average household may stretch themselves a little bit further by keeping up with the Joneses. They tend to spend more frivolously and not live as frugal.
This is a trap to be aware of if you are in a high cost of living area. You can be savvy with your money and save, but you have to be cognizant of how you spend your hard-earned salary.
HCOL Cities…
These are the HCOL areas. Do you need to avoid them? No, but going into those areas, you must realize the cost of living will be higher.
Here’s a list of all of the cities that are the top 20 cities that are high cost of living areas according to Kiplinger:
1.
Manhattan, New York
(145.7% above U.S. average)
2.
San Francisco, California
(94.7% above U.S. average)
3.
Honolulu, Hawaii
(97.6% above U.S. average)
4.
Brooklyn, New York
(80.5% above U.S. average)
5.
Washington, D.C.
(60.7% above U.S. average)
6.
Seattle, Washington
(56.7% above U.S. average)
7.
Oakland, California
(53.9% above U.S. average)
8.
Arlington, Virginia
(50.5% above U.S. average)
9.
Orange County, California
(50.2% above U.S. average)
10.
Boston, Massachusetts
(48.8% above U.S. average)
11.
Queens, New York
(47.8% above U.S. average)
12.
Los Angeles, California
(46.6% above U.S. average)
13.
Bethesda, Maryland
(45.5% above U.S. average)
14.
San Diego, California
(41.4% above U.S. average)
15.
Alexandria, Virginia
(40.0% above U.S. average)
16.
Stamford, Connecticut
(36.4% above U.S. average)
17.
Portland, Oregon
(34.3% above U.S. average)
18.
Fairbanks, Alaska
(27.9% above U.S. average)
19.
Bergen County & Passaic County, NJ
(26.6% above U.S. average)
20.
Anchorage, Alaska
(24.4% above U.S. average)
Source: Kiplinger
What Is LCOL Area Mean?
LCOL stands for lower cost of living.
These cities have a lower average cost of living versus the average.
Simply put…your ability to stretch your income goes much further in a low cost area compared to a high cost of living area. This is where you can get a bigger bang for your buck.
Pros and Cons of LCOL
The differences in the area where you can live can be vastly different. Thus, providing benefits or drawbacks of choosing to live there.
The cons are typically the reasons that most people want to stay away from these cities.
This is where personal preference tends to play the biggest reason for choosing one location over another.
Just like with a high cost of living area, you need to weigh the pros and cons of living somewhere where expenses are not quite as high.
Advantages of LCOL –
Slower Pace of Life
One of the biggest benefits is a slower pace of living in low cost of living area.
Life doesn’t move as fast.
There is more time to breathe, there is more time to step back and take a bigger picture. It is not go, go, go, go 24/7. Time to enjoy the fresh air and slower pace.
Cheaper Housing
This is why people choose to live in a low cost of living area. Period.
You are able to afford much more house for much less.
That right there, over the long term can make or break somebody financially.
Lower Taxes
Many of the lower cost of living cities also benefit from lower taxes as well. They have lower income taxes, and even possibly, lower property taxes. So, this is something to take into consideration when looking at a low cost of living area.
Check what the difference would be from where you’re currently at to where you are considering moving.
Remote Work
This is the bread and butter spot! When you can take in a higher pay and still live in a LCOL city.
After 2020, remote work is becoming more and more popular. In addition, it is an added benefit companies are including to attract skilled employees.
This is one scenario where you can get the best of both worlds.
Disadvantages Of LCOL Cities
Less Opportunities
First of all, there are fewer opportunities. There are fewer things to do, there are less things going on. The airport is a further drive away.
In a big city, you can always find events happening. It may not be the same in other cities. However, some cities have created programs to draw in residents with the big city feel like Bellefontaine, Ohio.
Income Potential is Lower
The job market doesn’t have the high-paying jobs that you would find in the bigger cities. The income potential in one of these cities does not compare.
Let’s face it… a good majority of your working years are about built around making an income. With a lower cost of living city, the income limitations can be cumbersome and it takes longer to be able to reach your financial goals.
LCOL States and Countries with LCOL
Geographic arbitrage can give you great value for your money.
Arbitrage is the spread of differing prices for the same thing like rent, food, or transportation.
This means you can save more money by living in LCOL state or spend less of your nest egg by living in a LCOL countries.
These are the areas you can find the lower cost of living. There are many LCOL cities to be found as well.
LCOL States:
1.
Mississippi
(84.10% of U.S. average)
2.
Kansas
(86.67% of U.S. average)
3.
Oklahoma
(88.09% of U.S. average)
4.
Alabama
(88.80% of U.S. average)
5.
Arkansas
(89.16% of U.S.average)
6.
Georgia
(89.30% of U.S. average)
7.
Tennessee
(89.49% of U.S. average)
8.
Missouri
(89.75% of U.S. average)
9.
Michigan
(90.54% of U.S. average)
10.
Indiana
(90.57% of U.S. average)
Source: US News
LCOL Countries:
Listed in alphabetical order because there are many to chose from based on your personal preferences.
The definition of MCOL is any area that just has an medium cost of living.
There is not one extreme or another. These cities are just plain average. Maybe slightly above or below the median cost of living.
This can be a sweet spot of reaching your financial goals while enjoying a higher quality of life.
Benefits of MCOL Area
As you can read on Reddit personal finance threads, there are plenty of reasons to live in an MCOL area.
Mostly because these types of cities you can get the best bang for your buck, and still have the pros of living in a high cost of living area, as well as the pros of living in a low cost of living area.
This is where the job market may be very stable with good wages but the cost of living is not going to cost you a fortune.
Also, you can find tons of cities that meet the criteria of a MCOL city.
Cost of Living Varies within Cities
Regardless of whether you choose, HCOL, LCOL, or MCOL areas, the cost of living will be dramatically different between these cities.
Whether you are looking at the downtown area, the outlying suburbs, or maybe even the cities that have popped up around near the main city.
Just because the city is HCOL or LCOL, there will be neighborhoods that will be the outliers to the main part of the city.
So, when you are looking at cost of living, you must know the things that are most important to you and what type of neighborhood that you would want to live in because they can be found.
That is what I call hidden gems.
It is possible to find a cheaper house in a low cost of living or high cost of living area, you just have to do your homework and know what you’re looking for.
Vice versa, it is very possible to find a neighborhood in a low cost of living area that is much higher than the surrounding areas.
How can I buy a house in a high cost of living?
It is possible to be a homeowner in a in a high cost of living area. You just have to be able to afford the down payment on the house to make being a homeowner justifiable, if possible.
Before you decide to buy a house, here are some factors you need to take into consideration..
1. Does it make sense?
First, you have to make sure that it makes logical sense to buy a house. Especially in a high cost of living area because the house prices may not match up to what the income that you are bringing in.
Will you still be able to reach your money goals by purchasing a house? Or will you be house poor?
2. Compare rent to potential mortgage
Will it be cheaper to rent? Or cheaper to have a mortgage?
To figure this out, take what the average rent is in your neighborhood. Then, use a mortgage calculator to figure out the maximum amount you can afford.
Since those calculators will leave you house poor. Decide what you are able to justify in spending on a mortgage and figure out what the mortgage payment is.
Is the mortgage payment less than average rent in the area?
For example, it may cost in a high cost of living area, like San Diego, it may cost $3,000 a month to rent a house. Whereas you might be able to buy a similar home in the same neighborhood and have your mortgage payment of $2,259.
Thus, making buying makes more financial sense than continuing to rent.
3. Expand your horizons
Another tip to afford your dream house – do not be set on that one specific neighborhood in a high cost of living area.
Many times you can find an up-and-coming neighborhood that is much less than the trendier and hip current neighborhoods that you want to live in.
Thus, you can typically save a good chunk of money. Plus in the long run, you greatly increase the potential for home equity.
4. New Homebuyer Programs
If this is the first time you are buying a house, then look into first-time homebuyer programs and grants. (Hint… this is like free money!)
There are many out there because cities want their residents to buy in their neighborhood and their cities because that means they are going to be there for a longer-term.
Also, there are programs for the military, teachers, nurses, single moms, minorities, graduate students. You just have to look.
5. Save for Down Payment
When you are looking at buying a house, this is the time to become serious about saving for a down payment.
You may have to find ways to save more money each month.
This could include things like downsizing your lifestyle to make it possible. Living with friends or family while you save up more money. Or just spending less for a certain period of time until you reach your downpayment goal.
6. House Hacking
The last step is one of the best ways to reach financial independence in a high cost of living city. Plus the concept works well in any city… house hack.
Find a multi-family housing property that you were able to buy. For example, plan to live on one side of the duplex and rent out the other. This will help you pay for your mortgage, by using the rent collected from your renters.
Thus, lowing your overall housing cost, which is your biggest expense.
Where Does Your Income Go the Furthest?
This is a comparison that you may be surprised by the outcome. Thus, proving why you need to do cost comparisons to see what financially makes the most sense when deciding to move from one to the other area.
comparison of income, expenses, taxes, and potential savings!!!!!!!!!!!
Once again, this is personal to your situation. So, take a moment and use the cost of living calculator yourself.
Paying taxes is one option to increase what you take home in each paycheck.
No Income States
These are the states that don’t pay state income taxes on wages:
Alaska
Florida
Nevada
New Hampshire
South Dakota
Tennessee
Texas
Washington
Wyoming
For most people, that is an instant decrease in overall taxes!
Higher Taxed States
Also, if you live in one of the higher taxed states, then you may want to reconsider moving to a lower cost of living area.
The higher taxes income tax states include:
California
Hawaii
New Jersey
Oregon
Minnesota
The District of Columbia
New York
Vermont
Iowa
Wisconsin
These states tax income somewhere between 7.65% – 13.3%.
Property Taxes
Property taxes vary from state to state.
In some states with large property taxes, it may even out with no income taxes. While other states, like Illinois, where property taxes are high and income taxes are above the national average as well.
Moving From HCOL to LCOL
The reason that most people move from HCOL to LCOL area is to save money. They want to decrease their expenses – that is the primary driver. Other times, it may be that they’re looking for a different type of lifestyle.
But as you can read on Reddit, everybody has a different personal experience.
It may have been beneficial and may have been bad timing. It may have been the best choice. It may have been the worst decision.
Make sure to factor in the costs associated with the move. Also, any ongoing expenses like travel if you are moving away from family.
How to Choose HCOL or LCOL?
Deciding where you live is one of the most personal decisions that you can make. Nobody can make it for you. You know what you want in life, how you want to live, and where you would feel more comfortable.
So, let’s look primarily at the financial side of making this decision of what is best.
1. Lifestyle You Desire
There are massive differences between HCOL and LCOL cities!! In big cities, life moves at a faster pace. While most cheaper cities areas move at a slower pace, so you have to make the decision of what type of lifestyle.
Do you want you want the big city? Do you want suburbia? Or do you prefer more of a country lifestyle?
When looking at this first factor, your answer should not include money. This is where your heart is. This is where your home. This is the life that you plan on living. This doesn’t include the financial sense.
This includes what makes your heart happy.
2. Your Money Goals
One of the things that discussed the most on this site is the 10 Money Bliss Steps to Financial Freedom. That is where most of our readers find their current money goal. And for good reason, you must build a strong foundation with money one step at a time.
In order to achieve long term financial success, the decision on housing is critical as it is the biggest expense in any budget. And that is can have the greatest impact on your budget!
On the flip side, the amount of income you are capable of making can also make the biggest impact on what you can afford to spend.
You must decide on your current money goal as well as the longer term money vision. Maybe you are looking at wanting to retire early? Love to live a slower life in the future?
It is possible to live in HCOL area where you are able to live extremely frugally and save more money. This is what my friend did over at Tuppennys FIREplace. For them, it was a smarter decision. On the flip side, maybe you are happier living a slower pace of life. Income is not the primary driver and you just want to enjoy life more.
At the end of the day, you must prioritize what you want, how your budget and your expenses correlate, and how your saving rate is impacted in various cities.
3. Season of Life
For those in their younger years may not understand this as much, but as you go through seasons of life, you will realize that you have different goals, objectives, and desires along the way.
When deciding where to live, your current season of life will probably have a very high impact on what you are looking for.
If you have young kids, you probably want to find a neighborhood where you have other families nearby that your kids can interact with.
If you are close to retirement, you may look decide to move out of the good school district because you do not need to pay the premium of living here. You may choose to move to a lower cost of living area, so you have the freedom to travel and help my kids and grandkids.
4. Potential Income & Career Opportunities
The greatest benefit of a high cost of living area is the income potential and the career opportunities. Both are much greater in the bigger cities than you would find in the smaller cities.
If your primary goal is increasing your income and advancing your career, then looking at high cost of living areas an absolute must. Plus you might be able to find something on the outskirts of expensive neighborhoods, that would make the most financial sense.
Then, living in HCOL is justified and necessary and the income can justify the higher costs associated.
On the flip side, there is plenty of income potential as a small business owner in a low cost of living area. You just have to know the market, what your skills are in, and what the needs are in your area.
4. Fixed Expenses
Fixed expenses can be dramatically different in each area.
Write out a list of your top fixed expenses and make sure to compare those as well.
For example, child care costs and tuition are going to be much more expensive in a big city than in the suburbs. Maybe in certain neighborhoods, a car would not be needed; thus, eliminating another big cost and associated maintenance.
While some fixed expenses seem meniscal, over time, they can add up significantly. Thus, helping or hurting your financial picture.
Unspoken Price Tag to Live Somewhere
As we covered in this post, there is a lot to consider when deciding between HCOL, LCOL, or MCOL areas.
It is a highly personal decision that you must take the time to make the best decision for you!
Not someone else, but for you.
One thing to watch out for when looking at where to live is what I call the “price tag” of a beautiful city.
Many times, employers know that the city that people want to live in their city for whatever reason. Thus, you will experience what I like to call the “income hit” to living there.
For example, Fort Collins, Boulder, and Austin are highly desirable areas for postgraduates to live in because they fall in love with the town and they want to stay here for the long term. Thus, employers know that this!
As a result, income for jobs maybe 10 to 15% less than they could make in any other type of market or city. So, that is something just to be aware of when wanting to stay in the city that they have grown to love.
In conclusion, when you’re looking at a high cost of living area versus a low cost of living area, there are two sides to the coin.
One – what makes financial sense. Two – your home is where your heart is.
Consequently, you have to make the decision on what makes sense for you.
While it makes financial sense to move to a lower cost city, at the same time, it may move you away from your family and your support system, and everything that you enjoy, and you may not be as happy in the long run.
Enjoy weighing the alternatives between all of the options available.
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