Six-Figure Salary: What It Gets You In 2022

Hitting a six-figure salary is part of the American Dream. A six-figure salary lets you live more comfortably and, in many cases, in the lap of luxury. So, what exactly will six figures get you in 2022?

In 2022, a six-figure salary allows you to provide for a family and pay the bills. If you intend to live in a nice location, buy a bigger house, pay for luxury vacations, or acquire other luxuries, earning a six-figure salary will get you there. 

This article discusses a six-figure salary. It also details the lifestyle and assets accessible to six-figure earners. Read further to determine what a six-figure income lets you afford and how taxes impact it.

pile of cash on white counter

UPDATED: JUNE 2022

How Far Does A Six-Figure Salary Stretch Where You Live?

So, what kind of life do you get for a six-figure salary in the year 2022? Where you live in the United States impacts how much your six figures are worth. 

In this section, let’s look at the ten most affordable states and the ten most expensive but desirable states to compare the value of a six-figure salary across the United States.

To understand how salaries are calculated and reported, we need to define the difference between the median and the mean. 

The median figure is the numerical figure that separates the top half from the lower half of the data. It is the exact middle number in a set of data and is used when the distributions are skewed. 

The mean is used to determine the mathematical average of a set of numbers. The mean is the most used measure for arriving at a set of figures’ central tendency and is used for data sets with a normal distribution.

This value is calculated by adding the numbers in the data set and then dividing them by the number of figures in the set.

The mean cost of housing and the residents’ mean salary is also included to explain how much of a six-figure salary is required for comfortable living in each state.

On basis of comparison, the national average annual salary is $48,672 based on a 40-hour workweek. In 2020 the average cost for a previously owned home was $260,000, while the average price for a newly built home was $334,000.

There are factors beyond average rent and home price to consider when determining how comfortable of a life your six-figure salary provides. Additional factors to research if you live in any of the top 10 expensive states include: 

  • Groceries
  • Transportation and gas
  • Childcare
  • Health care
  • State taxes

These goods and services tend to be priced higher on average than other states and have an impact on how much you can get for your six-figure salary.

For example, groceries and gas are much more expensive in Hawaii and Alaska because of offshore shipping costs.

Housing is much more expensive in Maryland because of its proximity to Washington D.C. and major harbors. In New York, housing is even more astronomical because of the prime real estate in the suburbs closest to Manhattan, where many people work.

If you intended to live in luxury, some of these states require a salary on the higher end of the six-figure spectrum.

The 10 Most Affordable States To live In: Stretch Your Salary Further

In this section, we look at the most affordable, ranked from more expensive to the least expensive state. Keep in mind; there are still pockets in these states where the cost of living is increased, specifically in metropolitan areas.

The table below lists both the mean and median yearly income to give a basis of comparison as to how the standard of living increases in these states with a six-figure salary. Further cost of living information is discussed state by state. 

StateMean Yearly IncomeMedian Yearly Income
Indiana$85,139$57,603 
Tennessee$74,750 $53,320
New Mexico$64,351$49,754
Alabama$69,842$50,536
Georgia$55,075$61,980
Missouri$76,060$55,461
Kansas$66,664$62,087
Arkansas$66,557$47,597
Oklahoma$72,695$51,924
Mississippi$62,835$45,081

Indiana

Ranking the most expensive of the ten most affordable states in the country, Indiana’s living index cost is 90.4, making the cost of living 9.6% lower than the average for the nation. 

In Indiana, the cost-of-living index is 90.4. The housing index in Indiana is 75.6, but the value of homes has increased by 8.5% in the last year alone.

A 2-bedroom apartment in Indiana, on average, will run you $750 a month to rent.

The average price for a typical 4-bedroom home in Indiana is $170,955. The average monthly average cost for a mortgage is $693, which makes up about 11.85% of the average income.

Tennessee

Ranked as the ninth cheapest state in the U.S., the cost of food is much lower here than in other states, but food costs vary from city to city. Monthly utilities tend to be lower in Tennessee than in other states as well. The cost-of-living index is 90.2. 

The average rent for a two-bedroom apartment is $854 a month. The average cost of your typical house in Tennessee is $205,297, making the median monthly mortgage payment $1,224. 

4.8% of Tennessee’s residents make over $200,000 annually. 

New Mexico

The average yearly salary in New Mexico is based on a range from the 25th percentile to the top earners ($44,481- $80,876). New Mexico’s cost of living index is 89.6. 

Utility bills are significantly lower than the national average. The average rent for a 2-bedroom apartment is $762/month. The median cost of a house is $193,200, making the housing index 80.4. 

Compared to other states, New Mexico offers inexpensive: 

  • Health care
  • Transportation

Alabama

Alabama has higher taxes and utilities than some of the other more affordable states, but it makes up for it with the cost of housing. The cost-of-living index is 89.4. 

For a 2-bedroom apartment, the median rent is $698/month. The median cost of a home in Alabama is $129,300, making the housing index 70.2.

Georgia

In the Peach State, the average cost of renting a 2-bedroom apartment is $788 per month unless you live in Atlanta, where the rent jumps to $1,517 a month.

The average cost of a house in Georgia is $265,000. A typical house at this price has three bedrooms, two bathrooms and is around 2,244 square feet. 

Groceries and gas prices are below the national median costs. The cost-of-living index is at 89.4. 

Missouri

The “show me” ranks as the fifth most affordable state, boasting the lowest housing costs in the nation. Rent for a 2-bedroom apartment averages at $694 per month. The average cost for a 4-bedroom house is a little over $200,000. 

Groceries are significantly less costly than other states. The cost-of-living index in Missouri is 88.9 compared to the rest of the country. 

Kansas

The sunflower state’s cost of living is about 12.1% lower than the rest of the country, with a cost-of-living index of 87.9.

Rent for a 2-bedroom apartment in Kansas is $821/month. The median cost of a house in Kansas is $137,700. 

Groceries are significantly lower than the national average. A dozen eggs cost $1.32 in some parts of the state. To live in Springfield is about 14.1% below the national average, and Joplin is 17.7% lower.

Arkansas

Formerly known as the “land of opportunity,” Arkansas is the third most affordable state to reside in the nation. Whether you rent or own your home, the average monthly cost for rent or a mortgage is $708. The median cost of a house is $128,800.

Unfortunately, the cost of living is balanced out with the lowest rate of yearly income in the country. Arkansas’ cost of living index is at 87.8.

Oklahoma

Oklahoma is the second cheapest state in the nation to live in, with a cost-of-living index of 86.8. The average rent for a 2-bedroom apartment is $879 per month. The average price for houses in Oklahoma is $124,800. 

Other items that are much lower than the national average cost are: 

  • Groceries 
  • Utilities
  • Gas 

Mississippi

Southern hospitality is not the only great thing about Mississippi. It also ranks as the most affordable state to reside in the United States. The average cost of living is %15 below the national average with a cost-of-living index of 84.8. 

Rent for a 2-bedroom apartment averages at $703 per month. The average value of a house in Mississippi is $126,511. 

Other living costs that are more affordable in Mississippi than in most other places in the nation include: 

  • Childcare
  • Health care
  • Food 

The 10 Most Expensive States to Live In: How Much Money Do You Need?

A six-figure salary does not have the same value across the country. Living in expensive cities with high cost of living can drastically alter your quality of life.

Below is a table that outlines the average yearly incomes and cost of housing in these states. While not an official state, Washington D.C. is included in the list. 

StateCost of living IndexAverage IncomeMedian IncomeAverage rent (2-bedroom apartment)Average Home Price
Hawaii196.3$65,000$80,212$2,413$1,158,492
District of Columbia 161.1$67,867$85,203$2,776$675,000
California138.5$62,356$75,277$2,495$554,866
Oregon134.6$84,258$62,818$907$549,358 (median)
New York133.7$61,372$64,894$3,667$1,901,222
Massachusetts132.6$111,498$77,378$81,215$663,942
Maryland128.1$111,417$84,805$1,700$794,750
Alaska128.0$98,606$77,640$1,288$265,385
Connecticut125.1$113,031$78,444$1,295$662,447
Rhode Island119.4$89,093$67,167$1,385$331,458

While the ten states listed above can be quite expensive to live in (especially the closer you are to a metropolitan area), a six-figure salary can bring you more comfort and some nice perks while living in a desirable location. 

Living in Hawaii, for example, is quite expensive because food has to be shipped to the island. However, you have access to some of the world’s most exquisite: 

  • Beaches
  • Landforms (volcanoes)
  • Cultural centers and events
  • Cuisine

If you work in a major city like New York City, it might be worth your money to pay the exorbitant rent to live in a high-end apartment close to your work.

If you prefer a house, then it might be worth the mortgage and transportation costs to purchase a nice home located in an upscale community in neighboring Long Island or Connecticut.  

Jobs That Earn Six Figures 

There are many options out there for six-figure jobs. All of these high income jobs don’t just offer a solid career path, but also financial security.

  • Physician’s Assistant
  • Transportation and Storage Manager
  • Airline Pilots
  • Dentist
  • Electronic Engineer
  • Software developer
  • Human Resource Manager
  • Air Traffic Controller
  • Higher Education Administrators
  • Nurse Practitioners
  • Professional Athletes
  • Personal Financial Advisors
  • Chief Executives
  • Pharmacists
  • Doctors and Surgeons
  • Software Engineer
  • Commercial Pilot
  • Real Estate Broker

All of these jobs pay a median salary average of around 100,000 dollars. The education level needed to be eligible for these jobs depends on the position. Some require a high school diploma, some a master’s degree while others will require a doctoral degree.

Healthcare Professions

A good portion of these jobs are in the healthcare-related field. Physician’s assistants, nurse practitioners, dentists, pharmacists, and doctors/surgeons, require more schooling than your average bachelor’s degree. But the salary for these jobs is well over 100,000 and can help you pay off any student loan debt.

These professions can be extremely rewarding and are usually in high demand. The amount of schooling may seem extensive, but depending on where you live, you can save more of your money.

Business Professions

Another field that tends to be great for higher-paying jobs are those in the business sector. In fact, even college professors in business departments can makeover 100,000. These jobs require financial prowess but also a good understanding of networking and interpersonal skills.

This field has been growing due to the technology sector and business tax incentives. A business job can be a long-term job with room for growth that will allow you to expand on your original salary.

Manufacturing Positions

Some manager positions such as a transportation and storage manager make 100,000. If you have a good understanding of the manufacturing market and how to interact with others, you can do this job without ever earning a college degree.

These positions require you to have good time management and organization skills. Typically, people who work in these positions will have spent years working through the company. This allows them to have the necessary understanding and expertise of the processes and products of the company.

Quality Healthcare and Wellness at Your Fingertips

Affordable, quality healthcare can be hard to come by as employer costs have skyrocketed in the last decade. However, with a six-figure salary, healthcare costs are not only manageable but enable you to receive some of the best medical services available. 

With a six-figure salary, you are less likely to wait if you need a serious medical procedure. Not only that, but you may even have a choice as to which medical facility to have the procedure and which specialist to perform it. 

For an additional yearly fee, concierge services, the newest trend in high-end health care, provide the following services for patients who subscribe: 

  • Virtual correspondence
  • In-house specialization
  • Care coordination

Virtual Correspondence with Your Medical Practitioner

Rather than have to procure an appointment, patients of concierge medical practices can simply reach out to their doctor in the following ways: 

  • Email
  • Text
  • Call

Often less serious medical issues can be taken care of without even seeing the doctor in person. This not only buys you great medical service but the time you would have spent driving to the doctor’s office and sitting in the waiting room. 

In-house Specialization Saves Time and Travel

Medical concierge services have a team of specialists in-house, so you won’t need to get a referral and schedule yet another appointment to treat any malady that comes up at your wellness or other visit. 

Care Coordination

The coordination of care and medical procedures is streamlined among the medical professionals involved in the care of a concierge patient. 

This practice is known as “quarter-backing” and helps patients to get appointments with specialists set up promptly. 

Communication among physicians and specialists makes transitions from doctor to doctor seamlessly as they have immediate access to patient records. 

Access to Wellness Products and Services

Beyond the quality and “high-end” health care, a six-figure salary allows you to enjoy wellness products and services that can be pricey.

In today’s world, many of us are overworked and stressed out. This can cause conditions like: 

  • Tension and stress
  • Anxiety
  • Chronic fatigue
  • Chronic pain

Many of these disorders do not respond to the traditional medicinal treatment, and that’s where many Americans have turned to wellness centers and practices. 

Some wellness centers require a yearly or monthly membership. Others are priced by service or product and can be quite expensive, but those who are willing to pay are usually happy with the treatment they receive. 

Wellness can include a wide range of products and services outside of traditional medicine and not covered by healthcare, including but not limited to the following: 

  • Massage therapy
  • Acupuncture
  • Counseling and therapy
  • Reiki and long-distance reiki
  • Oxygen chambers
  • Sensory deprivation chambers
  • Pathogen cleansing
  • Yoga classes
  • Chakra balancing therapy
  • Food and nutrition counseling
  • More nutritious, organic foods
  • Wellness supplements

How Your Six-Figure Salary Will Cover the Cost of Children

Raising children is expensive. The costs start building up when they are conceived and continue to compound over the next 18 plus years. 

In the first year of life alone, a child costs the average income family between $8,750 to $12,000. The table below lists the average costs of staple items associated with having an infant. 

Item Cost
Diapers$900
Formula$1200 – $1500/year
Baby food$60/month
Stroller$200 – $1,200
Bedroom Set (crib, dresser, changing table rocking chair)$1,000 to $2,000
Highchair $70 – $150
Play yard$40 – $200
Car Seat$100 – $300

This list doesn’t include other necessary items such as: 

  • Clothes
  • Toys
  • Diaper wipes
  • Lotions
  • Ointment
  • Additional equipment (swing, play stations)

This is just for starters. As children grow and develop, their needs change, and there are always new products and services to purchase to support healthy development and entertainment.

The Cost of Childcare

Child care is probably the most expensive part of having children. Infant childcare is the most expensive, and then the costs usually decrease as children get older and become more independent. Full-time daycare for an infant in the U.S. is $1,412 a month.

By the time they age out of daycare, it is time to think about the preschool tuition and then whether they will go to public or private school.

Academic Advantages You Can Afford with a Six-Figure Salary

Education is undoubtedly one of the most important tools one can receive and carry with them throughout life. In the United States, everyone has the right to free and appropriate education.

If you want a competitive advantage for yourself or your children, a six-figure salary can help you get it. Four years of college and additional years of graduate and postgraduate work will run you well into the hundreds of thousands of dollars. 

What better way to pay for college than through earning scholarships? Using your money to pay for academic services before college gives your children a competitive advantage.

Living Near A “Good” Public School versus Private School 

If you want the best education that money can buy, you will either need to live in an area where state and local taxes are higher, ensuring that public schools are well funded, or pay for private school.

On average, private school tuition across the U.S. ranges from $5,900 to $26,000 per year, with some of the highest-ranked schools exceeding the higher end. What you get for your money includes:

  • Higher expectations for students
  • Staff who are certified in the subject they teach
  • Smaller classes
  • Funding for field trips that offer authentic learning opportunities
  • Opportunities to participate in exclusive activities or organizations
  • Networking
  • A competitive edge in applying for college and scholarships

Investing in a good elementary and secondary education increases the likelihood that your child will receive college scholarships which is where tuition costs escalate substantially. 

Using Your Six-Figure Salary to Invest in College Savings Plans

Another way to effectively utilize your six-figure salary is by investing in college savings plans for your children early on. This is beneficial for several reasons. 

If you set aside part of your monthly income to contribute to a college savings plan starting at the birth of your child, their college tuition will be paid for by the time they get there. 

Contributing sufficient funds may provide additional money to cover boarding, books, and other additional fees associated with a college education. If enough money is invested wisely, the resulting funds can cover graduate and postgraduate education. 

In turn, once your children have earned a bachelor’s degree or beyond, they are more likely to earn their way to their own six-figure salary.

Upgrading Your Vacations on A Six-Figure Salary

We all look forward to well-earned intermit spring break trips and family summer vacations or other intermittent getaways to take a break from our usual routines. 

With a six-figure salary, you can upgrade your vacations and derive more enjoyment during your time off.

Are you taking the family to Disney World? Instead of booking a value resort, enjoy one of the more luxurious resorts located on Disney property. Opt for the upgraded park hoppers passes and all-inclusive meal plans.

Paying more upfront allows you to sit back, relax and not think about money during your vacation. This same concept applies to any destination you choose.

Now, instead of researching the thrifty way to travel, you can simply enjoy the fruits of your labor. Not worrying about money throughout your travel allows you to destress and enjoy time with your loved ones. 

Other Pleasures A Six-Figure Salary Provides

You may have a nice house or apartment, but what fun is it if you don’t have the things that bring you pleasure and comfort inside of it. 

Nice furniture and artwork bring comfort and aesthetic value to the interior of your house. This is just for starters. 

Outfit Your House with Innovative Technology

A six-figure salary also provides for state-of-the-art technology at your fingertips as well. With a more significant income, you can treat yourself to: 

  • A more extensive television with the most precise picture
  • Movie theater-quality surround sound speakers
  • Computers
  • Tablets
  • Smart Phones
  • Higher internet speeds
  • Security cameras
  • Intercom (inside and outside)

Additional Amenities That Provide Joy 

Your salary can provide for other fun toys and equipment for your family to enjoy in their free time. 

Outfit your backyard for the kids (and yourself) with the following fun things: 

  • Deluxe jungle gym set
  • Giant trampoline
  • Bouncy house
  • Swimming pool
  • Diving board and slide for the pool
  • Water Trampoline 
  • Hot tub
  • Basketball court
  • Volleyball court

There are endless ways to make your house a fun place to enjoy the fruits of your labor. 

Factors That Affect Your Six-Figure Salary

Even though you may be taking home a six-figure salary, there are still factors that can diminish your take-home pay. Your obligations and bills do not go away when you are making more money.

Student Loan Debt

Most of the jobs that earn six-figure salaries require a degree from a higher education institution. When pursuing higher education, you may need to take out student loans to fund your education.

These loans can have high interest rates and can leach away from your take-home pay. When paying student loans, they can take away from your net pay, and it can take years to pay it off.

Where You Live

As stated earlier, the cost of living differs in various parts of the country.  Some cities have higher costs of living, and your salary might not stretch as far. When deciding what job you are interested in, you may want to research the places you are thinking of living in to see how much your cost of living will be.

The cost of living factors can depend on rent, loans, and utility bills that limit the amount of money you are taking home. By living in a lower-income area, you can make your salary go further.

Happiness

When working at a six-figure salary job, you may spend more time at your job. This can force you to not spend as much time doing the things you enjoy. Your happiness may suffer, and you will struggle to make meaningful connections in your life.

This can limit the joy a six-figure salary job can give you and force you to spend more time working.

Cost/Time Differential

When you are working at a highly stressful and pressure-filled job, you may end up spending your money more recklessly. This can include the need to eat out or send other services out that may be doable if you had more time. Your six-figure salary can dwindle when you are paying for services and convenience.

The time/cost differential ensures you get things done, but your salary might not stretch as far. This can also be affected by where you are living and what services you need to fulfill.

Taxes

Depending on what tax bracket you are in and what state you live in, your taxes can greatly impact your overall pay. You may have a six-figure salary, but that can then be dwindled down to less when taxes are taken out.

When researching jobs, you may want to figure out what the taxes are and how they will affect your pay. This can impact how much money you see and what you will need to give up.

Uncle Sam comes calling to all of us in one way or another. The amount of money you make, combined with how much is withheld from your paycheck throughout the year, makes a difference in how much you owe in federal, state, and local taxes.

Based on the 2020 rates for federal taxes as published by the Tax Foundation, here is the breakdown of what to expect to be taxed for your annual six-figure salary.

Single IndividualMarried Filing JointlyTaxation Rate
$40,126 to $85,525$80,251 to $171,05022%
$85,526 to $163,300$171,051 to 326,60024%
$163,301 to $207,350$326,601 to $414,70032%
$207,351 to $518,400$414,701 to $622,05035%
$518,401 or more $622,051 or more 37%

How State and Local Taxes Impact Your Six Figure Annual Income

Taxation rates vary from state to state, so you will have to do some research to figure out how the rate of taxes for the state you live in will affect your net income. Typically, counties or townships that cost more to live in also have higher taxation rates. 

Most of the more expensive states to live in have higher state and local tax rates than the more affordable states. Tennessee, for example, taxes investment income but does not tax wages. Other states that do not tax wages according to the Tax Foundation are: 

  • Alaska
  • Florida
  • Nevada
  • South Dakota
  • Texas 
  • Wyoming 

Tax Breaks to Keep More Of Your Money

If you don’t want as much of your money taken from your paycheck, there are tax breaks that you can use so you can keep your hard-earned dollars to reinvest in yourself and your family. 

You can receive basic tax breaks for things like: 

  • Monetary donations
  • Childcare costs
  • Environmentally friendly additions to your home
  • Equipment and materials for a home-based business
  • Education

Consider donating to a charity that is meaningful to you in some way. You will be able to write off the donations. 

You can deduct up to a specific amount of your childcare costs from your taxes as well. 

Adding solar panels or other environmentally friendly features to your house will get you a tax credit in some states. 

If you work from home or own a home-based business, you can write off the materials and equipment needed to make your business run. 

You can also get a tax break if you are currently enrolled at an institution for higher learning if you have paid for tuition out of pocket. 

Maximizing Your Six-Figure Salary

If you have achieved your six-figure annual income, then you are in a great place financially. How you maximize it to create the lifestyle you want depends not only on where your salary is along the six-figure spectrum but on how you strategize your spending.

Arming yourself with financial information such as the tax rates and cost of living, groceries, utilities, and transportation in the place where you live or dream of moving to will help you to spend wisely so your money can help you get the things that allow you to live your best life. 

 

In 2021, a six-figure salary allows you to provide for a family and pay the bills. If you intend to live in a nice location, buy a bigger house, pay for luxury vacations, or acquire other luxuries, earning a six-figure salary will get you there. 

This article discusses a six-figure salary. It also details the lifestyle and assets accessible to six-figure earners. Read further to determine what a six-figure income lets you afford and how taxes impact it.

What is considered a six-Figure salary?

Technically, a six-figure salary is income between $100,000 – $999,999.99. Typically when you hit the $200,000 threshold you are then said to be making multiple six-figures.

With that being said, depending on the area you live, six-figures a year can look hugely different in terms of quality of life.

How Far Does A Six-Figure Salary Stretch Where You Live?

So, what kind of life do you get for a six-figure salary in the year 2021? Where you live in the United States impacts how much your six figures are worth. 

In this section, let’s look at the 10 most affordable states and the 10 most expensive but desirable states to compare the value of a six-figure salary across the United States. 

To understand how salaries are calculated and reported, we need to define the difference between the median and the mean. 

The median figure is the numerical figure that separates the top half from the lower half of the data. It is the exact middle number in a set of data and is used when the distributions are skewed. 

The mean is used to determine the mathematical average of a set of numbers. The mean is the most used measure for arriving at a set of figures’ central tendency and is used for data sets with a normal distribution. 

This value is calculated by adding the numbers in the data set and then dividing them by the number of figures in the set. 

The mean cost of housing and the residents’ mean salary is also included to provide an idea of how much of a six-figure salary is required for comfortable living in each state. 

On basis of comparison, the national average yearly income is $48,672 based on a 40-hour work week. In 2020 the average cost for a previously owned home was $260,000, while the average price for a newly built home was $334,000. 

There are factors beyond average rent and home price to consider when determining how comfortable of a life your six-figure salary provides. Additional factors to research if you live in any of the top 10 expensive states include: 

  • Groceries
  • Transportation and gas
  • Childcare
  • Health care
  • State taxes

These goods and services tend to be priced higher on average than other states and have an impact on how much you can get for your six-figure salary. 

For example, groceries and gas are much more expensive in Hawaii and Alaska because of offshore shipping costs.

Housing is much more expensive in Maryland because of its proximity to Washington D.C. and major harbors. In New York, housing is even more astronomical because of the prime real estate in the suburbs closest to Manhattan, where many people work. 

If you intended to live in luxury, some of these states require a salary on the higher end of the six-figure spectrum. 

The 10 Most Affordable States To live In: Stretch Your Salary Further

In this section, we look at the most affordable, ranked from more expensive to the least expensive state. Keep in mind; there are still pockets in these states where the cost of living is increased, specifically in metropolitan areas. 

The table below lists both the mean and median yearly income to give a basis of comparison as to how the standard of living increases in these states with a six-figure salary. Further cost of living information is discussed state by state. 

StateMean Yearly IncomeMedian Yearly Income
Indiana$85,139$57,603 
Tennessee$74,750 $53,320
New Mexico$64,351$49,754
Alabama$69,842$50,536
Georgia$55,075$61,980
Missouri$76,060$55,461
Kansas$66,664$62,087
Arkansas$66,557$47,597
Oklahoma$72,695$51,924
Mississippi$62,835$45,081

Indiana

Ranking the most expensive of the 10 most affordable states in the country, Indiana’s living index cost is 90.4, making the cost of living 9.6% lower than the average for the nation. 

In Indiana, the cost-of-living index is 90.4. The housing index in Indiana is 75.6, but the value of homes has increased by 8.5% in the last year alone. 

A 2-bedroom apartment in Indiana, on average will run you $750 a month to rent. 

The average price for a typical 4-bedroom home in Indiana is $170,955. The average monthly average cost for a mortgage is $693, which makes up about 11.85% of the average income. 

Tennessee

Ranked as the ninth cheapest state in the U.S., the cost of food is much lower here than in other states, but food costs vary from city to city. Monthly utilities tend to be lower in Tennessee than in other states as well. The cost-of-living index is 90.2. 

 An average rent for a two-bedroom apartment is $854 a month. The average cost of your typical house in Tennessee is $205,297, making the median monthly mortgage payment $1,224. 

4.8% of Tennessee’s residents make over $200,000 annually. 

New Mexico

The average yearly salary in New Mexico is based on a range from the 25th percentile to the top earners ($44,481- $80,876). New Mexico’s cost of living index is 89.6. 

Utility bills are significantly lower than the national average. The average rent for a 2-bedroom apartment is $762/month. The median cost of a house is $193,200, making the housing index 80.4. 

Compared to other states, New Mexico offers inexpensive: 

  • Health care
  • Transportation

Alabama

Alabama has higher taxes and utilities than some of the other more affordable states, but it makes up for it with the cost of housing. The cost-of-living index is 89.4. 

For a 2-bedroom apartment, the median rent is $698/month. The median cost of a home in Alabama is $129,300, making the housing index 70.2.

Georgia

In the Peach state, the average cost of renting a 2-bedroom apartment is $788 per month unless you live in Atlanta, where the rent jumps to $1,517 a month. 

The average cost of a house in Georgia is $265,000. A typical house at this price has 3 bedrooms, 2 bathrooms and is around 2,244 square feet. 

Groceries and gas prices are below the national median costs. The cost-of-living index is at 89.4. 

Missouri

The “show me” ranks as the fifth most affordable state, boasting the lowest housing costs in the nation. Rent for a 2-bedroom apartment averages at $694 per month. The average cost for a 4-bedroom house is a little over $200,000. 

Groceries are significantly less costly than other states. The cost-of-living index in Missouri is 88.9 compared to the rest of the country. 

Kansas

The sunflower state’s cost of living is about 12.1% lower than the rest of the country, with a cost-of-living index of 87.9. 

Rent for a 2-bedroom apartment in Kansas is $821/month. The median cost of a house in Kansas is $137,700. 

Groceries are significantly lower than the national average. A dozen eggs cost $1.32 in some parts of the state. To live in Springfield is about 14.1% below the national average, and Joplin is 17.7% lower. 

Arkansas

Formerly known as the “land of opportunity,” Arkansas is the third most affordable state to reside in the nation. Whether you rent or own your home, the average monthly cost for rent or a mortgage is $708. The median cost of a house is $128,800. 

Unfortunately, the cost of living is balanced out with the lowest rate of yearly income in the country. Arkansas’ cost of living index is at 87.8. 

Oklahoma

Oklahoma is the second cheapest state in the nation to live in, with a cost-of-living index of 86.8. The average rent for a 2-bedroom apartment is $879 per month. The average price for houses in Oklahoma is $124,800. 

Other items that are much lower than the national average cost are: 

  • Groceries 
  • Utilities
  • Gas 

Mississippi

Southern hospitality is not the only great thing about Mississippi. It also ranks as the most affordable state to reside in the United States. The average cost of living is %15 below the national average with a cost-of-living index of 84.8. 

Rent for a 2-bedroom apartment averages at $703 per month. The average value of a house in Mississippi is $126,511. 

Other living costs that are more affordable in Mississippi than in most other places in the nation include: 

  • Childcare
  • Health care
  • Food 

The 10 Most Expensive States to Live In: How Much Money Do You Need?

A six-figure salary does not have the same value across the country. Below is a table that outlines the average yearly incomes and cost of housing in these states. While not an official state, Washington D.C. is included in the list. 

StateCost of living IndexAverage IncomeMedian IncomeAverage rent (2-bedroom apartment)Average Home Price
Hawaii196.3$65,000$80,212$2,413$1,158,492
District of Columbia 161.1$67,867$85,203$2,776$675,000
California138.5$62,356$75,277$2,495$554,866
Oregon134.6$84,258$62,818$907$549,358 (median)
New York133.7$61,372$64,894$3,667$1,901,222
Massachusetts132.6$111,498$77,378$81,215$663,942
Maryland128.1$111,417$84,805$1,700$794,750
Alaska128.0$98,606$77,640$1,288$265,385
Connecticut125.1$113,031$78,444$1,295$662,447
Rhode Island119.4$89,093$67,167$1,385$331,458

While the 10 states listed above can be quite expensive to live in (especially the closer you are to a metropolitan area), a six-figure salary can bring you more comfort and some nice perks while living in a desirable location. 

Living in Hawaii for example is quite expensive because food has to be shipped to the island. However, you have access to some of the world’s most exquisite: 

  • Beaches
  • Landforms (volcanoes)
  • Cultural centers and events
  • Cuisine

If you work in a major city like New York, it might be worth your money to pay the exorbitant rent to live in a high-end apartment close to your work. 

If you prefer a house, then it might be worth the mortgage and transportation costs to purchase a nice home located in an upscale community in neighboring Long Island or Connecticut. 

Quality Healthcare and Wellness at Your Fingertips

Affordable, quality healthcare can be hard to come by as employer costs have skyrocketed in the last decade. However, with a six-figure salary, healthcare costs are not only manageable but enable you to receive some of the best medical service available. 

With a six-figure salary, you are less likely to wait if you need a serious medical procedure. Not only that, but you may even have a choice as to which medical facility to have the procedure and which specialist to perform it. 

For an additional yearly fee, concierge services, the newest trend in high end health care, provide the following services for patients who subscribe: 

  • Virtual correspondence
  • In-house specialization
  • Care coordination

Virtual Correspondence with Your Medical Practitioner

Rather than have to procure an appointment, patients of concierge medical practices can simply reach out to their doctor in the following ways: 

  • Email
  • Text
  • Call

Often less serious medical issues can be taken care of without even seeing the doctor in person. This not only buys you great medical service but the time you would have spent driving to the doctor’s office and sitting in the waiting room. 

In-house Specialization Saves Time and Travel

Medical concierge services have a team of specialists in-house, so you won’t need to get a referral and schedule yet another appointment to treat any malady that comes up at your wellness or other visit. 

Care Coordination

The coordination of care and medical procedures is streamlined among the medical professionals involved in the care of a concierge patient. 

This practice is known as “quarter-backing” and helps patients to get appointments with specialists set up promptly. 

Communication among physicians and specialists makes transitions from doctor to doctor seamless as they have immediate access to patient records. 

Access to Wellness Products and Services

Beyond the quality and “high end” health care, a six-figure salary allows you to enjoy wellness products and services that can be pricey. 

In today’s world, many of us are overworked and stressed out. This can cause conditions like: 

  • Tension and stress
  • Anxiety
  • Chronic fatigue
  • Chronic pain

Many of these maladies do not respond to traditional medicinal treatment, and that’s where many Americans have turned to wellness centers and practices. 

Some wellness centers require a yearly or monthly membership. Others are priced by service or product and can be quite expensive, but those who are willing to pay are usually happy with the treatment they receive. 

Wellness can include a wide range of products and services outside of traditional medicine and not covered by healthcare, including but not limited to the following: 

  • Massage therapy
  • Acupuncture
  • Counseling and therapy
  • Reiki and long-distance reiki
  • Oxygen chambers
  • Sensory deprivation chambers
  • Pathogen cleansing
  • Yoga classes
  • Chakra balancing therapy
  • Food and nutrition counseling
  • More nutritious, organic foods
  • Wellness supplements

How Your Six-Figure Salary Will Cover the Cost of Children

Raising children is expensive. The costs start building up the moment they are conceived and continue to compound over the next 18 plus years. 

In the first year of life alone, a child costs the average income family between $8,750 to $12,000. The table below lists the average costs of staple items associated with having an infant. 

Item Cost
Diapers$900
Formula$1200 – $1500/year
Baby food$60/month
Stroller$200 – $1,200
Bedroom Set (crib, dresser, changing table rocking chair)$1,000 to $2,000
Highchair $70 – $150
Play yard$40 – $200
Car Seat$100 – $300

This list doesn’t include other necessary items such as: 

  • Clothes
  • Toys
  • Diaper wipes
  • Lotions
  • Ointment
  • Additional equipment (swing, play stations)

This is just for starters. As children grow and develop, their needs change, and there are always new products and services to purchase to support healthy development and entertainment. 

The Cost of Childcare

Childcare is probably the most expensive part of having children. Infant childcare is the most expensive, and then the costs usually decrease as children get older and become more independent. Full time daycare for an infant in the U.S. is $1,412 a month. 

By the time they age out of daycare, it is time to think about the preschool tuition and then whether they will go to public or private school. 

Academic Advantages You Can Afford With a Six-Figure Salary

Education is undoubtedly one of the most important tools one can receive and carry with them throughout life. In the United States, everyone has the right to free and appropriate education. 

If you want a competitive advantage for yourself or your children, a six-figure salary can help you get it. Four years of college and additional years of graduate and postgraduate work will run you well into the hundreds of thousands of dollars. 

What better way to pay for college than through earning scholarships? Using your money to pay for academic services before college, gives your children a competitive advantage. 

Living Near A “Good” Public School versus Private School 

If you want the best education that money can buy, you will either need to live in an area where state and local taxes are higher, ensuring that public schools are well funded or pay for private school. 

On average, private school tuition across the U.S. ranges from $5,900 to $26,000 per year, with some of the highest ranked schools exceeding the higher end. What you get for your money includes: 

  • Higher expectations for students
  • Staff who are certified in the subject they teach
  • Smaller classes
  • Funding for field trips that offer authentic learning opportunities
  • Opportunities to participate in exclusive activities or organizations
  • Networking
  • A competitive edge in applying for college and scholarships

Investing in a good elementary and secondary education increases the likelihood that your child will receive college scholarships which is where tuition costs escalate substantially.

Using Your Six-Figure Salary to Invest in College Savings Plans

Another way to effectively utilize your six-figure salary is by investing in college savings plans for your children early on. This is beneficial for several reasons. 

If you set aside part of your monthly income to contribute to a college savings plan starting at the birth of your child, their college tuition will be paid for by the time they get there. 

Contributing sufficient funds may provide additional money to cover boarding, books, and other additional fees associated with a college education. If enough money is invested wisely, the resulting funds can cover graduate and postgraduate education. 

In turn, once your children have earned a bachelor’s degree or beyond, they are more likely to earn their way to their own six-figure salary. 

How Do Taxes Impact Your Six-Figure Salary 

Uncle Sam comes calling to all of us in one way or another. The amount of money that you make, combined with how much is withheld from your paycheck throughout the year, makes a difference in how much you owe in federal, state, and local taxes. 

Based on the 2020 rates for federal taxes as published by the Tax Foundation, here is the breakdown of what to expect to be taxed for your annual six-figure salary. 

Single IndividualMarried Filing JointlyTaxation Rate
$40,126 to $85,525$80,251 to $171,05022%
$85,526 to $163,300$171,051 to 326,60024%
$163,301 to $207,350$326,601 to $414,70032%
$207,351 to $518,400$414,701 to $622,05035%
$518,401 or more $622,051 or more 37%

How State and Local Taxes Impact Your Six Figure Annual Income

Taxation rates vary from state to state, so you will have to do some research to figure out how the rate of taxes for the state you live in will affect your net income. Typically, counties or townships that cost more to live in also have higher taxation rates.  

Most of the more expensive states to live in have higher state and local tax rates than the more affordable states. Tennessee, for example, taxes investment income but does not tax wages. Other states that do not tax wages according to the Tax Foundation are: 

  • Alaska
  • Florida
  • Nevada
  • South Dakota
  • Texas 
  • Wyoming

Tax Breaks to Keep More Of Your Money

If you don’t want as much of your money taken from your paycheck, there are tax breaks that you can use so you can keep your hard-earned dollars to reinvest in yourself and your family. 

You can receive basic tax breaks for things like: 

  • Monetary donations
  • Childcare costs
  • Environmentally friendly additions to your home
  • Equipment and materials for a home-based business
  • Education

Consider donating to a charity that is meaningful to you in some way. You will be able to write off the donations. 

You can deduct up to a specific amount of your childcare costs from your taxes as well. 

Adding solar panels or other environmentally friendly features to your house will get you a tax credit in some states. 

If you work from home or own a home-based business, you can write off the materials and equipment needed to make your business run. 

You can also get a tax break if you are currently enrolled at an institution for higher learning if you have paid for tuition out of pocket. 

Maximizing Your Six-Figure Salary 

If you have achieved your six-figure annual income, then you are in a great place financially. How you maximize it to create the lifestyle you want depends not only on where your salary is along the six-figure spectrum, but on how you strategize your spending. 

Prioritize what is most important to you. Is it having a big house with all of the amenities or being able to live in a major metropolitan area.  Avoiding lifestyle creep (buying fancy cars or a more expensive house with every raise) can help maintain the life you want.

Arming yourself with financial information such as the tax rates and cost of living, groceries, utilities, and transportation in the place where you live or dream of moving to will help you to spend wisely so your money can help you get the things that allow you to live your best life. 

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Kristen

Kristen is the founder and content creator at Mom Managing Chaos where she teaches busy moms how to simplify and organize their life and finances. She writes about frugal living, budgeting, productivity and organization.