Despite a six-figure income seeming like a lot of money, there are a large handful of US cities where even modest monthly expenses are so high that families making $100,000 annually are falling behind on their bills.
A study from Lending Tree analyzed how far $100,000 for a family of three would go in the country’s 100 largest metro areas.
In the top 16 least affordable cities for $100K earners, eight of them are in California – including the top three on the list.
The study based its findings on a breakdown of spending categories frequently classified as ‘basic’ needs, including housing, child care, health care, food, entertainment and utilities, and of course taxes.
Other considerations were transportation, student loans, and savings.
Houses in downtown San Jose, California, the city determined to be least affordable for a family of three making $100,000
After that breakdown, the study found that in San Jose, California – a suburb of California’s tech-bubble, Silicon Valley – a family of three earning $8,333 per month, would have a net monthly income of -$1,493.
Exceptionally high housing and transportation costs bring the monthly expense total in San Jose to a whopping $9,496. In April, a Redfin rental data supported the position that the median rent was well south of $3,000.
In San Francisco, the same family would be netting -$1,163, and in Oxnard, the net negative would drop to -$904.
In SF, housing and transportation also rank most expensive, in addition to a bill of more than $1,000 for food.
In Oxnard, the study reports that average rent for a two-bedroom apartment is $2,023.
Also on the list are Honolulu, San Diego, Los Angeles, Washington, DC, Seattle, Boston and Denver.
Shockingly, no area of New York City made the list, though Poughkeepsie, New York – a city about an hour upstate of Manhattan – ranked 14th least affordable, where a family of three would have a net-negative income of $156.
New York City was the 17th ranked local where a $100,000 income would stretch the shortest distance. According to the study, after monthly costs, a family of three in NYC would be left with a mere $6.
Honolulu, the capital of Hawaii, was ranked fourth among cities that are least affordable for a family of three making $100,000. Expenses in the tropical paradise would generate a balance of -$865 at the end of the month
Jackson, Mississippi, on the other hand, was determined to be the major US city where a salary o $100,000 for three people would stretch the furthest
The median household income in Mississippi is just below $50,000 – about $20K off from the national average
The study also detailed which major US cities are the most affordable for a family of three making $100,000 annually.
Topping that list is Jackson, Mississippi, where monthly expenditures would total $6,939 and net income would leave a unit with $1,394. The cost of living in Jackson is about 11 percent cheaper than the national average, making a place that a family could maximize the spending power of $100,000.
The median household income in Mississippi is $49,111 – about $20,000 beneath the national median of $69,021.
Chief Credit Analyst at LendingTree Matt Schulz described why it is believable that even relatively high earners may be struggling to get by in high cost of living areas.
‘Lots of people in this country make six figures and are broke in this country for as many reasons as there are people,’ he said.
‘Some of it may be the result of questionable choices, but for many, it’s simply due to things that are out of their control, such as outrageous housing prices, the high cost of gas, grocery bills or health care expenses. The truth is that the financial margin for error for most Americans, including many who earn six-figure salaries, is perilously small.’
San Jose is the largest US city with an Asian plurality population. Thirty-seven percent of the city’s roughly 1million residents are Asian, while 31 percent are Hispanic, 25 percent are white, and the rest either identify as mixed race or African American.
According to Data Commons, the 2020 median household income in San Jose was $117,325. The median property value was $925,800.
In San Francisco, about 40 percent of the population is white, 34 percent is Asian, 15.5 percent is Hispanic, and 5 percent is black.
In 2020, the median household income was $119,136.
San Francisco, came in as the second least affordable city for a salary of $100,000 – due in large part to the exceedingly high costs of rent, food, and transportation in the Silicon Valley adjacent urban establishment
Oxnard, a city in Ventura, California is the third worst place financially for a family of three to live on $100,000 a year. The city of about 200,000 has an astoundingly high average rent market
San Diego rounded out the top five cities that are the worst for a three-person household living off $100,000 to live. The seaside southern California city would run the average family netting $8,333 a month into -$766 of debt every month
In Oxnard, a city roughly 60 miles to the west of Los Angeles, the median household income dipped below the six-figure threshold to $77,050. The city of about 200,000 people is roughly 75 percent Hispanic, 13 percent white, and seven percent Asian.
In Honolulu, Asian Americans are the dominant demographic group with a share of 55 percent of the population. Eighteen percent of the population is white, eight-and-a-half percent is Native Hawaiian and other Pacific Islander, and one-and-a-half percent is black.
In 2021, the median household income of Hawaii’s capital was $92,600. A family of three earning $100,000 loses $865 per month, according to the LendingTree study.
In San Diego, where a family of three earning $100,000 would be losing $766 a month, the median household income of 2021 is $89,457.
The southern California city of 1.3million people is 40 percent white, 30 percent Hispanic, 18 percent Asian, and six-and-a-half percent black.
Source: | This article originally belongs to Dailymail.co.uk