The rich are certainly getting richer. 25 U.S. cities have seen a big increase in the wealth of the wealthy. The Wall Street Journal recently reported that the U.S. economy is doing pretty well right now, with low inflation, rising consumer spending and low unemployment — all of which could be helping line the pockets of the wealthy.
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To identify cities where wealth is growing among the wealthy, GOBankingRates selected the 100 cities with the highest median household income and household count of more than 7,500 from the 2022 American Community Survey. Each city's median household income in 2019, median household income in 2022, and three-year percentage change in median household income were scored and combined by GOBankingRates. The percentage of the population with a household income of $200,000 or more in 2019 and 2022, and the three-year percentage change in the population with a household income of $200,000 or more were also factored into the final numbers.
Here's what I learned:
Key findings
- The wealthy are thriving in California. Los Altos, California topped the list as the No. 1 city where the wealthy are getting wealthier with a median household income of $400,817 in 2022. Seven of the cities in the top 10 are in California. There were a total of 11 California cities on the list of 25 cities ranked by GOBankingRates. Crunching the numbers, we find that 44% of the places where the wealthy are getting wealthier are just in California.
- More than half of the growing wealth is on the West Coast. Fifteen of the 25 cities on the list are located in two West Coast states: California and Washington.
- When it comes to wealth growth, the East Coast lags behind the West Coast. Despite being largely absent from the top 10, nine cities from East Coast states made it into the top 25 list.
- Massachusetts is the most popular East Coast state with growing wealth. Of the total list of 25 cities, the five that made the ranking include Wellesley, Winchester, Needham, Lexington and Marblehead.
- Texas is the only Southern state ranked for wealth growth. Southlake, Texas, was the only Southern state to make the top 10, coming in at No. 5. In the ranking of 25 cities, it is the only Southern state to make the list.
- An increase in income of more than $200,000. Among the top 10 cities, more than half of the population in cities like Los Altos, Wellesley, McLean, Southlake, Saratoga, Cupertino, Palo Alto and Lafayette earn more than $200,000.
Cities where the wealthy are getting even wealthier
Let's take a look at the top 10 cities where the wealthy are getting even wealthier.
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1. Los Altos, California
Los Altos is ranked number one city where the wealthy are getting even wealthier.
The median household income in 2019 was $326,456, which jumped to $400,817 in 2022. The three-year percentage change shows that the median household income increased by 22.78%.
There has been a steady increase in incomes over $200,000 for a large portion of the city's population. In 2019, 57% of the population earned $200,000 per year. By 2020, this amount had increased to 64%, meaning that more than half of Los Altos' population earns more than $200,000 per year.
2. Wellesley, Massachusetts
Coming in second is Wellesley, Massachusetts, one of only two East Coast cities to make the top 10.
Wellesley's median household income has increased 27% over three years, from $287,793 in 2019 to $367,801 in 2022. Wellesley residents also enjoyed three years of income increases: In 2019, 49% earned more than $200,000 annually. That number jumps to 64% by 2022.
3. McLean, Virginia
Coming in third is the second-highest ranking East Coast city on this list, McLean, Virginia. Like Los Altos, McLean also saw a 22% change in median household income over the three-year period.
But unlike Los Altos, McLean residents will see a much faster jump in incomes above $200,000. In McLean, the percentage of residents earning more than $200,000 will increase from 52% in 2019 to 61% in 2022, an 18% increase.
4. Los Gatos, California
Los Gatos, ranked No. 4, had the largest three-year percentage change in median household income of any city ranked in the top 10.
Median household income was $217,966 in 2019 and will jump to $305,653 in 2022, an increase of 40%.
The population earning more than $200,000 per year is also expected to show a healthy 22% increase over the three-year period, from 40% in 2019 to 49% in 2022.
5. Southlake, Texas
Coming in at No. 5 is Southlake, Texas, the only Southern state to make the top 10 list of cities with even more affluence.
In Southlake, the percentages are generally very favorable. Median household income has increased 20% over three years, from $299,637 in 2019 to $360,078 in 2022.
However, the population earning more than $200,000 has grown more slowly than the other nine cities in the top 10, with incomes growing just 9% over the three-year period.
6. Saratoga, California
Saratoga, California, occupies the sixth place in GOBankingRates' rankings.
Many of those percentages are in line with other notable California cities ranked in the top 10. Median household income has increased 27% over the three-year period. Saratoga's population earning more than $200,000 also continues to grow, growing rapidly from 47% in 2019 to 58% in 2022.
7. Menlo Park, California
Menlo Park, California residents saw their median household income increase by 31% within three years, putting the city in seventh place.
Income above $200,000 is on the rise, and as of 2022, almost 50% of Menlo Park's population earns this amount annually.
8. Cupertino, California
Coming in at No. 8 was Cupertino, California, which had the second-largest change in median household income after Los Gatos.
In 2019, the median household income for Cupertino residents was $206,009. This amount is expected to increase to $283,063 in 2022, an increase of 37%.
The number of people earning more than $200,000 a year is also on the rise, with 54% expected to earn this amount annually by 2022.
9. Palo Alto, California
Coming in at number 9 is Palo Alto, California, where median household income grew by nearly 30% within the last three years, from $232,529 in 2019 to $301,226 in 2022.
As of 2022, more than half of Palo Alto residents, 52%, earn more than $200,000.
10. Lafayette, California
Rounding out the top 10 is Lafayette, California, which will see a significant increase in median household income from $250,550 in 2019 to $312,233 in 2022, an increase of nearly 25%.
Like many of the cities in the top 10, incomes above $200,000 remain the norm in Lafayette, which has grown from 45% in 2019 to 53% in 2022, a 16% increase.
Methodology: For this article, GOBankingRates first looked at the 100 cities with the highest median household income and total households of 7,500 or more from the 2022 American Community Survey conducted by the U.S. Census Bureau. These cities were selected, and for each city, GOBankingRates calculated (1) the median household income in 2019, (2) the median household income in 2022, (3) the three-year percentage change in median household income, (4) the percentage of the population with a household income of $200,000 or more in 2019, (5) the percentage of the population with a household income of $200,000 or more in 2022, and (6) the three-year percentage change in the population with a household income of $200,000 or more. Factors (2), (3), and (5) were then scored and combined with the lowest score as the best score. In the final calculation, factor (2) was weighted 4 times and factor (3) was weighted 2 times. All data was collected and current as of April 29, 2024.
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This article originally appeared on GOBankingRates.com: American Wealth: 25 Cities Where the Rich Are Getting Even Richer
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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