5 U.S. Cities Where Your Paycheck Goes the Furthest

Many factors influence where we choose to live. While our home's proximity to friends and family is a crucial deciding factor, ultimately where we decide to live is influenced by our finances. The two major factors influencing where we live are the cost of living and the income potential in a given region. The problem with looking at these two factors individually, however, is that they often are highly influenced by one another and have a strong positive correlation. Fat paychecks in New York City and San Francisco translate into $20 salads, exorbitant rents, and surge-priced Uber rides.

When we analyze the data, it’s apparent that the most affordable cities to live in while earning an excellent living are in the middle of the country, rather than along the expensive coasts. We’ve compiled a list of the best cities in the United States that combine a low cost of living with relatively high per capita income compared with the rest of the nation.

Houston, Texas

The city of Houston benefits from a high domestic migration rate and a high economic growth rate. According to the U.S. Census Bureau’s 2021 population estimates (the most recent data available from the Census Bureau), Texas has experienced the nation's largest population growth for each year between 2010 and 2021. The 2020 Census reports that the population for Texas is 29.1 million people, adding nearly 4 million people between 2010 and 2020, an increase of 15.9%.

Houston is one of the state's leading areas of population growth, primarily due to its resilient economy. While Houston is well-known as a major oil town, the city has seen job growth in a variety of sectors, including information technology, biomedicine, aeronautics, and manufacturing. Houston’s average household income was $84,179 in 2020. Houston residents' income levels typically outpace the cost of living, with a fabulous transportation system, relatively affordable housing, and low prices of common consumer goods.

Dallas-Fort Worth, Texas

The Dallas-Forth Worth hub also lies in the Sunbelt. The city benefits from high net domestic migration and a nonexistent state income tax.

In a 2022 cost of living comparison between Dallas and Los Angeles, you would need an income of around $8,151 per month in Los Angeles, California, to maintain the same standard of life that you can have with $4,500 per month in Dallas, Texas. The cost of living in Los Angeles is approximately 75% higher than in Dallas. The most significant differences between the two cities are home prices, which are 240% higher in Los Angeles than in Dallas.

Charlotte, North Carolina

Charlotte may seem off the beaten path to some, but to North Carolinians and Southerners who’ve grown up loving the city, the move seems like a no-brainer. Charlotte is a major U.S. financial center and is the headquarters of Bank of America. Other major industries include motorsports and energy. The city is home to the NASCAR Hall of Fame and boasts its own NFL football team, the Carolina Panthers.

In 2022, Charlotte's average household income is $94,516. Housing costs are a key factor in Charlotte's affordability, with the median home price coming in at $301,300. Median home costs are 53% lower in Charlotte compared to New York City.

Denver, Colorado

Denver is a gorgeous, relatively quiet city situated in the mountains. Downtown is a short half-hour drive from the University of Colorado at Boulder. Many beautiful, smaller towns are in the region, where people can hike with their dogs and families free of charge.

According to the Massachusetts Institute of Technology’s Living Wage Calculator as of Aug. 2022, a typical annual salary in Denver for a management job is $135,055. Business and financial operations workers typically earn a salary of $80,935. The calculated “living wage” that individuals must earn to support themselves working full time was $20.31 an hour as opposed to $30.81 in San Francisco. In addition to high wages, Colorado offers a high quality of life which continues to attract lovers of nature and adventure.

Austin, Texas

Dubbed “The Live Music Capital of the World” and the capital of the Lone Star State, the city of Austin had job growth of 5.1% in 2022 and a 2021 population of about 964,000. The knowledge hub of Austin is home to a new wave of workers who vary from “hippie types” to tech-savvy millennials and corporate employees. The influence of the University of Texas has turned the city into a tech hub with a lively downtown full of theaters, art galleries, and restaurants.

According to the City of Austin, in 2022 the median four-person household income in Austin is $110,300 and Realtor.com reports that the median home price came in at $659,000. MIT's Living Wage calculator states that a typical annual salary in Austin for a management job is $111,430 and $96,439 for a job in information technology.

The Bottom Line

Career mobility is rising due to the advent of technology, transportation, and communication systems, allowing the U.S. population to move from city to city quite easily. Often, high salaries coincide with a relatively high cost of living. This list of cities highlights a few of the outliers.

Cities in the middle of the country, particularly in Texas, place workers in an optimal financial situation. This is due to the net migration, economic boom, and high salary growth rates in these particular hubs. These cities offer a high quality of life due to low prices and decreased financial stresses while providing an opportunity to find a lucrative career.