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How much money do you need to make to be in the top 5% in your state?
By Nick Jachim,
29 days ago
(NEXSTAR) – The disparity between the income that an average U.S. resident brings in yearly compared to those sitting at the top of earners in each state has always been a major topic of discussion.
In fact, WalletHub states that “the highest-earning 10% of individuals in the United States earn over 12 times more than those in the lowest-earning 10%, based on the latest Census data.”
And while looking up what the “average salary” is across the country, ( $74,600 , according to the latest data from the Federal Reserve), appears to give a solid idea of how far off most Americans are from the 5% club, a closer look at the high-end salaries reveals that the disparity is even more stark.
WalletHub broke down the income of all 50 U.S. states and Washington D.C into three different groups: the average annual income of the top 5%, the average for the bottom 20%, and the median for all of each state’s residents.
Landing at No. 1 was New York where the top 5% makes about $553,000 a year. That’s almost $35,000 more than the next two highest states and nearly $100,000 more than the 10th-ranked state.
While the top 5% is thriving in the Empire State, its bottom 20% is falling well short, ranking 44th in salary with $13,301.
Right behind New York is Connecticut and Virginia where the average is about $518,000 apiece. Followed by New Jersey and Illinois which are both hovering around $505,000.
The state with the lowest top 5% threshold is Alaska, where earning roughly $321,000 will get you into the club. Hawaii and Vermont aren’t far behind where the top 5% makes about $334,000.
Check out what you need to make in your state:
Rank
State
Average Annual Income of Top 5%
Median Annual Income
Average Annual Income of Bottom 20%
1
New York
$553,436
$91,366
$13,301
2
Connecticut
$518,757
$114,156
$14,576
3
Virginia
$518,296
$89,393
$18,694
4
New Jersey
$505,621
$117,847
$16,445
5
Illinois
$504,800
$78,304
$16,192
6
Georgia
$487,870
$66,612
$16,472
7
Texas
$481,483
$70,513
$16,802
8
Washington
$474,067
$103,748
$18,223
9
Florida
$470,308
$68,818
$15,375
10
Massachusetts
$466,208
$127,760
$13,689
11
Minnesota
$464,981
$86,364
$19,797
12
Colorado
$456,603
$97,301
$18,451
13
California
$454,829
$123,988
$13,949
14
Tennessee
$453,539
$59,077
$15,679
15
District of Columbia
$450,892
$162,265
$9,011
16
North Carolina
$450,592
$63,025
$15,836
17
Utah
$448,195
$89,786
$22,491
18
Michigan
$446,114
$62,446
$17,019
19
Missouri
$446,069
$59,715
$16,821
20
Pennsylvania
$445,261
$74,711
$15,801
21
Ohio
$436,922
$61,904
$16,188
22
Maryland
$427,135
$124,693
$16,647
23
Arizona
$424,913
$74,375
$16,604
24
Kansas
$423,517
$68,489
$17,176
25
Nebraska
$416,325
$72,384
$17,380
26
Arkansas
$416,224
$51,032
$14,069
27
South Carolina
$412,771
$62,909
$13,996
28
Kentucky
$411,897
$55,629
$13,800
29
Oklahoma
$405,113
$57,215
$15,205
30
Idaho
$403,737
$70,041
$18,372
31
Delaware
$402,989
$87,173
$16,930
32
Wisconsin
$402,256
$72,602
$17,973
33
Nevada
$401,062
$80,366
$14,472
34
New Hampshire
$400,343
$110,205
$18,075
35
Indiana
$399,270
$64,170
$16,670
36
Alabama
$398,584
$55,480
$13,242
37
Montana
$395,720
$68,937
$15,337
38
Louisiana
$395,155
$56,282
$11,504
39
Iowa
$395,093
$68,974
$17,621
40
South Dakota
$393,809
$69,266
$17,252
41
North Dakota
$387,548
$79,874
$15,661
42
Wyoming
$387,280
$76,307
$16,199
43
Oregon
$377,399
$91,100
$14,720
44
Mississippi
$377,040
$46,880
$12,168
45
Rhode Island
$353,721
$104,252
$12,668
46
New Mexico
$351,972
$58,911
$11,944
47
West Virginia
$345,239
$52,719
$12,477
48
Maine
$338,866
$79,800
$13,749
49
Vermont
$334,470
$89,695
$14,477
50
Hawaii
$334,369
$141,832
$14,014
51
Alaska
$321,634
$113,934
$15,646
(Credit: WalletHub)
As for what state’s residents make the most money on average, Washington D.C. finished with the highest median income of $162,265. Unfortunately, D.C. also finished with the lowest salary for the average annual income of the bottom 20%, with $9,011.
Other states that had a high median income were Hawaii ($141,832), Massachusetts ($127,760), Maryland ($124,693), and California ($123,988).
These states with a smaller gap between the average earner and the top 5% make it easier to make the jump, but it’s still difficult.
According to GoBankingRates , it will take a variety of factors to make that jump. First, you need a steady increase in income. This could mean you are making better financial decisions, investing wisely, or perhaps experiencing career advancements.
Another factor is maybe having a solid investment strategy, look to see that you are getting positive returns on your investment and that you have a well-diversified portfolio.
Finally, prioritize your long-term financial stability. Look to prioritize saving over short-term pleasures.
And if you’re looking to go even higher than the top 5%, Forbes found that to be one of the top 1% of earners in the U.S., you need to bring in an annual salary of at least $597,815, so start saving up!
Copyright 2024 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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