Yahoo Finance How much money do you need to make to be in the top 5% in your state?
(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.
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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 |
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.
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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!
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