For People Living in These 3 Cities, $300K Feels Like the New $100K Due to Inflation

No matter where you live, you likely feel the sting of rising living costs. But in some parts of the country, you need to make much more money to live a comfortable life than in years past. A SmartAsset study found that residents in three major U.S. cities now need much more than a $100,000 salary to get by due to inflation. Is your city one of them?

A $100,000 salary won't go far in expensive U.S. cities

While residents in most towns and cities nationwide deal with rising living costs, some regions feel a greater impact. In cities with high living costs, residents feel they need to make much more money to afford their daily expenses in today's expensive landscape.

For many Americans, $100,000 used to be a realistic salary goal to live a comfortable life in many parts of the country -- but that's no longer the case in many areas thanks to inflation. While $100,000 may sound like a lot, it no longer affords you the same lifestyle as it did in years past due to higher taxes and living costs. That's especially true if you live in a high-cost-of-living area.

During the third quarter of 2022, SmartAsset conducted a study to determine the salary needed to feel like you're earning $100,000 in the U.S. Salaries in 76 cities were analyzed and adjusted for taxes and living costs to find the "new $100,000." The study found that a salary of $300,000 or more is needed in the following three cities to bring home the new $100,000.

1. Honolulu
2. New York City
3. San Francisco

Residents in these cities are taxed roughly 40.5% or higher and have a cost of living over 82% above the national average. Even if you have a solid savings account balance, a higher salary is necessary to live comfortably in these areas. Below, we'll break down the pre-tax income workers need to make in these cities to feel like they're earning at least $100,000.

Residents in Honolulu need to earn $312,400

The study found that those living in The Big Pineapple need to earn at least $312,400 pre-tax. This salary works out to be around $186K in take-home pay. Since many everyday goods are imported to the Hawaiian islands, residents of Honolulu pay much higher living costs than Americans who live in other parts of the country. Living expenses in this beautiful city are 86% above the national average.

New Yorkers need to make $312,000

New Yorkers need to earn similar money to afford life. The study found that residents must earn at least $312,000 pre-tax to achieve that six-figure feel. Workers who want to earn $100,000 in take-home pay can expect to pay around 41% in federal, state, and local taxes. The cost of living in New York City is 83.6% higher than the national average.

San Francisco workers need to earn more than $300,000

You'll need to earn triple a $100,000 salary to live well in San Francisco. This tech-focused California city has a median household income nearly double the national average. Living expenses cost 82.8% more than the national average, making it a pricey place to live. To earn $100,000 of purchasing power, San Francisco residents need to make just over $300,000 in pre-tax income. Having a higher checking account balance is useful if you live and work here.

Where you live can impact your finances significantly

While it would be nice to have the ability to live anywhere in the world without having to worry about living expenses, that's not a reality for most people. Where you choose to live can impact your finances significantly. If you're considering moving to a new-to-you part of the country, research living costs, housing expenses, and taxes before you make a big move.

The good news is that salaries tend to be higher in many high-cost-of-living parts of the country to account for living costs. But if you work a remote job or are self-employed, it's essential to consider whether your current salary will continue to meet your needs if you hope to move to a more expensive part of the U.S.

If you're open to living somewhere beyond the costly cities mentioned above, check out the most affordable cities with high salaries and low costs of living for inspiration. Even though life is more expensive in many parts of the country, it's possible to continue to make progress on your financial goals. For additional money tips, check out our personal finances resources.