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The lifestyle that a $100,000 salary can buy you varies significantly across the country, but due to inflation quality of life is starting to slip everywhere.

It’s no secret that New York City, San Francisco and Los Angeles are some of the most expensive cities in the country, but which cities offer the best value for the money?

According to a ranking by personal finance advisor SmartAsset, which takes into account state taxes as well as the overall cost of living, seven of the 10 best-value cities to live in are in Texas.

However, top of the list was Memphis, Tennessee, where the cost of living is almost 14 percent lower than the national average and no state taxes are applied on income.

At the bottom of the list was New York, where a $100,000 salary feels like just $36,000.

Predictably, towns in the center of the country offered the best value for money, in terms of cost of living and tax, whereas coastal cities were the most expensive

Predictably, towns in the center of the country offered the best value for money, in terms of cost of living and tax, whereas coastal cities were the most expensive

New York City was the most expensive city in the country, where a combination of state tax and high cost of living meant a $100,000 salary felt more like $36,000

New York City was the most expensive city in the country, where a combination of state tax and high cost of living meant a $100,000 salary felt more like $36,000

The financial comfort that comes with a 100,000-a-year salary is also diminishing. 

According to a survey from December 2022, carried by PYMNTS and LendingClub, around 51 percent of people earning more than $100,000-a-year were living paycheck to paycheck – seven percent higher than the year before.

The study calculated how much that salary would count for in real terms by applying all taxes and then scaling the remaining amount in accordance with the price of housing, groceries, utilities, transportation, etc. using data from the Council for Community and Economic Research.

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In Memphis, somebody making $100,000 took home around $75,000 after tax, which was then raised to $86,000 to compensate for a cheaper cost of living. 

El Paso in Texas, which also has no state income tax, was second on the list with an effective salary of $85,000.  

The low cost of living, as well as the lack of state income tax, means a $100,000 salary amounts to an average $78,000 in all the Texan cities analyzed. 

Other Texas cities in the top 10 included: Lubbock, Houston, San Antonio, Fort Worth and Arlington. Slightly separate from the rest of the pack was Austin, which was in 24th position with an effective take-home pay of $74,000. 

Dallas was in 34th position, where a salary of 100,000 was worth around $72,000.

Memphis is the US city where a $100,000 salary goes the furthest. A lack of state income tax and a low cost of living means the effective take-home salary is around $86,000

Memphis is the US city where a $100,000 salary goes the furthest. A lack of state income tax and a low cost of living means the effective take-home salary is around $86,000

‘I think it’s intuitive: $100,000, a six-figure income – it feels like this big milestone, but it also feels very different depending on where you live,’ Susannah Snider, a financial planner and the managing editor of financial education at SmartAsset told Bloomberg.

‘But to really break it down city-by-city reveals some of the quirks in what a difference where you live makes – and how the tax landscape of where you live really impacts what a six-figure salary feels like.’ 

The US economy is especially fragile. Contributing to the day-to-day burden on ordinary Americans has been the Russian invasion of Ukraine, which drove up energy prices. 

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In an attempt to combat high inflation in the last year the Federal Reserve has been gradually increasing interest rates. One likely consequence was the collapse of Silicon Valley Bank last week. 

After the SVB collapse, which saw depositors lining up outside bank branches in the hopes of withdrawing their money, concerns have been flagged that a ripple could topple other institutions and ultimately lead to a recession.  

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