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    Home»Millionaire Habits»How to Ruin a $100,000 Salary
    Millionaire Habits

    How to Ruin a $100,000 Salary

    Steve AdcockBy Steve AdcockMay 13, 2023Updated:May 14, 20234 Mins Read
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    A $100,000 salary is a good chunk of change, isn’t it?

    It sounds like a great salary, but there’s another piece to this equation that we need to keep in mind here. Millionaires not only know what that other piece is, but they are also great at exploiting that other piece.

    The fact is $100,000 isn’t necessarily $100,000 everywhere.

    Want to know why? Read on.

    Cost of living will make or break your salary

    Consider this: A $100,000 salary in New York City is equivalent to nearly $36,000 a year after taking into account the cost of living. In other words, making $100K in NYC is like making $36,000 elsewhere in the country.

    Well, shit, that’s no longer a lot of money, right?

    Maybe that’s why a whopping 51% of people earning more than $100,000 still live paycheck-to-paycheck. Let that sink in for a minute. That’s over half!

    Cost of living is the other piece of the puzzle, and knowing exactly how your location-based costs affect your income will help to make you a millionaire.

    Here are a few other cities where $100,000 doesn’t go far:

    • $36,000 – Honolulu, Hawaii
    • $36,400 – San Francisco, California
    • $46,600 – Boston, Massachusetts

    Living in expensive cities eats away at your salary. In some cases, more than 2/3rds of your salary effectively disappears due to the cost of living there.

    Curious how much you really have to earn in New York City to equal the purchasing power of a $100,000 salary?

    I’m unsure if you’re ready for this, but here goes: $312,000.

    👉 You need to earn over $310,000 in New York City just to have the same purchasing power as someone who earns $100,000 in a city with an average cost of living.

    Whereas cities like Memphis, Tennessee ($86,400) and Oklahoma City, Oklahoma ($84,500) eat significantly less of your salary to live there. Many Texas cities, like El Paso, Houston, and Lubbock, also eat less.

    If you like your high cost of living city, that’s fine. Your job is to ensure that you’re being compensated appropriately. Your financial future depends on it.

    So, what now?

    You get the point…your cost of living is important. Your location-based costs will eat away at your saving and investing power.

    What can you do about it?

    • Ask for a raise – If you love where you live and can’t stomach the thought of moving, ask for a raise instead. Millionaires don’t leave their salaries to chance. Be proactive and get what you deserve.
    • Switch companies – On average, job switchers make more money than those who remain loyal to a company (yes, it’s been proven). Try switching companies to get a better raise, a better job, and maybe even better benefits (like working from home part of the time).
    • Move to a cheaper city – This comes with pros and cons, of course. Cheaper cities may not have the same high-paying jobs available in more expensive cities. But then again, you may not need a higher-paying job if you live in a cheaper city.
    • Go remote and move to a cheaper city – Ask your boss if you can work remotely, at least part of the time. Then, consider moving to a cheaper nearby city, allowing you to drive once or twice a week to the office. This way, you can keep your high salary and pay less to live!

    Curious how your cost of living would change if you moved to another city? Check out this calculator to help make the math easy.

    💡 Other newsletters worth checking out

    • Amazon Insider – Want to start your very own Amazon business? Look no further than the Amazon Insider newsletter, where you get the scoop on making lots of money on Amazon.

    Chat soon,

    – Steve

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    Steve Adcock
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    Steve Adcock quit his job after achieving financial independence at 35 and writes about the habits millionaires use to build wealth and get into the best shape of their lives. As a regular contributor to The Ladders, CBS MarketWatch, and CNBC, Steve maintains a rare and exclusive voice as a career expert, consistently offering actionable counseling to thousands of readers who want to level up their lives, careers, and freedom. Steve lives in a 100% off-grid solar home in the middle of the Arizona desert and writes on his own website at MillionaireHabits.us.

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