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FILE - Commuters exit the Wall Street subway station in New York, on March 9, 2023. Photographer: Lila Barth/Bloomberg via Getty Images
NEW YORK - For most of us, when you hear "$100,000" – that sounds like a huge amount of money. But if you live and work in the New York metropolitan area, such a salary doesn't go very far.
Personal finance site SmartAsset recently compared how much a $100,000 salary is actually worth in 76 of the largest U.S. cities, and New York was dead last.
"I think for New York City, $100,000 would make you pretty poor," Parul Jain, an associate professor of finance and economics at Rutgers Business School, told FOX 5 New York.
"Poor" – did you read that? Making $100,000 a year in New York City is poor.
One New Yorker told FOX 5, "Honestly, unless you're making about $150,000, I'd say you can't live comfortably." Another noted how "80% of my salary goes to rent alone."
Susannah Snider, managing editor for Financial Education with SmartAsset, noted "just how much taxes and then cost-of-living chip away at a six-figure salary."
Here's the breakdown:
- In New York City, $100,000 amounts to about $36,000 after taxes and adjusting for the cost-of-living.
- Making $100,000 in Memphis, Tennessee equals about $86,000, according to SmartAsset's analysis.
- In Houston, Texas, it's about $81,000, and in St. Louis, Missouri, it was about $80,000, the analysis found.
FILE - The sun illuminates the Empire State Building behind the skyline of lower Manhattan and One World Trade Center on March 5, 2023, in New York City. (Photo by Gary Hershorn/Getty Images)
Jain noted said many of the factors that eat up an individual's money include housing, transportation, and taxes, while food costs have also increased everywhere.
"$100,000 doesn't go very far, as far as New York City, in particular, is concerned," Jain said. "They will be forced to share and to live more like grad students than professionals."
She said in addition to high taxes and housing costs, inflation is taking a considerable chunk out of our budget.
"The same basket of goods about a year ago cost $350 less per month."
We often hear the argument that workers earn higher salaries in the tri-state – salaries we would not earn if we moved to Tennessee or Texas, for example. But Jain said the pandemic changed that because many companies are now more flexible, and you don't have to live in the same state as where you work.
"They've decided to move to Florida or the Midwest and other places, where they can reap the advantages, still reaping or tapping into higher salaries, but yet getting a lower housing bill and so on," Jain said.
