It’s worth noting that a household income of $200,000 is higher than what the majority of people in the United States earn. In fact, according to Census Bureau data, only 12% of households in the U.S. have an annual income of $200,000 or more.
For most Americans, $200,000 can provide a comfortable financial cushion. However, this amount can go even further in areas where the cost of living is lower.
Although people move for many reasons, cost is often a significant factor. In fact, even families with high incomes are now relocating to more affordable states, particularly in the South. This may also serve as an additional incentive for individuals to consider moving.
New research from SmartAsset shows that between 2020 and 2021, Florida experienced a substantial net migration of high-earning residents. Based on data from the IRS, over 40,000 households earning $200,000 or more moved to the Sunshine State.
During that time, Florida experienced a decrease of 12,567 high-earning households, resulting in a net migration of 27,567 households.
The Southern region has witnessed a rise in its affluent population, with five out of the top 10 states experiencing the highest net migration of high earners.
Look at the top 10 states that attracted high earners from 2020 to 2021.
1. Florida
- Inflow: 40,134
- Outflow: 12,567
- Net migration: 27,567
2. Texas
- Inflow: 22,751
- Outflow: 13,743
- Net migration: 9,008
3. North Carolina
- Inflow: 11,437
- Outflow: 5,991
- Net migration: 5,446
4. Arizona
- Inflow: 9,763
- Outflow: 5,200
- Net migration: 4,563
5. South Carolina
- Inflow: 7,312
- Outflow: 2,802
- Net migration: 4,510
6. Tennessee
- Inflow: 7,353
- Outflow: 3,436
- Net migration: 3,917
7. Nevada
- Inflow: 5,576
- Outflow: 2,791
- Net migration: 2,785
8. Idaho
- Inflow: 3,246
- Outflow: 931
- Net migration: 2,315
9. Colorado
- Inflow: 8,771
- Outflow: 6,719
- Net migration: 2,052
10. Utah
- Inflow: 3,579
- Outflow: 1,827
- Net migration: 1,752
Where are households with a $200,000 income relocating to?
It appears that wealthy Americans prefer to live in states that have lower tax rates. States like Florida and Texas, which do not collect state income tax, are popular choices for this reason. Tennessee and Nevada are also among the states that do not require residents to pay state income tax.
The ranking of states is determined by their net migration, but if only inflows were considered, California and New York would come in at third and fourth place, respectively. However, despite having a large influx of people, both states experienced a significant number of high-income households leaving, causing their net migration totals to fall into negative territory.
Several states, including New Jersey, Washington, and Virginia, experienced a significant influx of households earning $200,000 or more. However, these states also had a higher number of such households leaving.
Although historically considered more budget-friendly compared to other regions of the United States, states located in the Sun Belt – encompassing the southern and southwestern parts of the country – have not been resistant to surging costs due to inflation in the past few years. According to a recent WalletHub study, multiple cities in Florida, Texas, and Arizona are among the areas experiencing the fastest inflation growth.
