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What is a good salary based on your location?

Red pin on the map, US east coast, Oakland, San Francisco, San Jose
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The reason a good salary depends on your location is that the cost of living varies from state to state. According to the Census Bureau's latest American Community Survey, the U.S. median household income in 2019 was $65,712.

That’s enough money to live a decent middle class life in my home state of Louisiana, where the median household income is $51,073 as per the census, but I’d probably have to decrease my standard of living if I moved to San Francisco where the median is $80,440. Why? Because San Francisco costs more.

How much more? Let’s use a cost of living calculator to find out, and compare San Francisco with Baton Rouge, Louisiana's capital city.

After inputting the data, we get the following results:

  • San Francisco is 197.9% more expensive than Baton Rouge.
  • The median cost of a home is 739.7% more expensive in San Francisco.
  • Food and groceries are 22.4% more expensive in San Francisco.
  • Utilities are 9.8% more in San Francisco.

What’s shocking is that the median home price in Baton Rouge is $164,200 compared to $1.38 million in San Francisco. If I were to make that move, my monthly mortgage payment would increase by a factor of 10. Also, I’d have to pay more in property taxes.

Even if I were to get a roommate in San Francisco, there’s a high probability I’d have to live paycheck to paycheck, unless I found a job that paid more. Since people in San Francisco typically earn more, I could possibly earn more by moving there.

According to data from the U.S. Bureau of Labor Statistics, or BLS, the average annual wage for all occupations in Louisiana is $44,170 versus $61,290 in California.

To make a more informed decision, I’d have to compare the annual wage based on my specific occupation. This is why the answer to what’s a good salary depends on your career choice.

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What is a good salary based on your career?

Back view of female employee speak talk on video call with diverse multiracial colleagues on online briefing, woman worker have Webcam group conference with coworkers on modern laptop at home
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When evaluating whether a salary is good or not, you’ll have to base it on your chosen career. The BLS website provides wage data based on your occupation.

For example, if you want to be a computer analyst, the average annual wage nationwide is $96,160. Since it is an average, high or low numbers skew the data a bit. The data is further broken up into percentiles.

Here’s a breakdown of what computer analysts earn:

  • The bottom 10% earn $55,180 per year.
  • The top 10% make $147,600 per year.
  • The median annual wage (meaning half the salaries are higher, half are lower) is $90,920.

Now, let’s compare that data to what elementary school teachers earn:

  • The bottom 10% earn $39,020 per year.
  • The top 10% make $97,900.
  • The median annual wage is $59,670.

As you can see, wages are generally higher for computer analysts than elementary school teachers. The BLS site has occupational data based on location as well. Use that info to help you make a more informed decision.

In addition, you can use websites including PayScale, Glassdoor and Indeed to find more salary statistics for research purposes.

Other factors to consider

health insurance form, paperwork and questionnaire for insurance concepts
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Although your salary is an important factor in determining whether to accept a job offer, you should ask yourself these questions:

  • Does the job offer good health insurance?
  • What’s the vacation policy?
  • Will I have an opportunity to grow with the company or acquire in-demand skills?
  • Will my salary allow me to pay off my debt?

Having good health insurance is paramount because medical expenses can potentially destroy your finances. When evaluating a job offer, be sure to include the benefit of health care in your analysis. Some employers might allow you to have access to an HSA plan that has triple tax benefits.

Also, don’t forget to inquire about the vacation policy. Will you be able to take some time off each year to avoid burnout? Time off is critical to having a healthy work-life balance.

Next, you should ask about growth and learning opportunities within the company. Depending on your experience, your starting salary may be on the lower end, but you might be able to earn more through getting raises and promotions.

Even if you don’t get promoted, you can seek out opportunities that’ll pay you more for the new skills you’ve acquired.

A final consideration is whether your salary will allow you to pay off your debt. Having debt with high interest rates can prevent you from building wealth. To get rid of the debt quickly, you might have to take on a job that pays a high salary but doesn’t offer much of a work/life balance.

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The best salary for you

Lifestyle freelance business woman working with laptop computer he has glad on the job in coffee shop
Sorapop Udomsri / Shutterstock

The best salary for you is one that allows you to achieve your financial goals. It is one that will pay you for doing something you enjoy doing.

Although you could earn a higher salary with a job as a computer systems analyst versus a job teaching children, you’ll have to decide which path fits your lifestyle.

Regardless of which path you take, keep in mind that gaining in-demand skills is a proven way to increase your salary in the long run.

When you increase your salary, remember that it's a wise money move to save and invest a portion of it to increase your financial security.

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About the Author

Jerry Brown

Jerry Brown

Freelance Contributor

Jerry was formerly a freelance contributor to MoneyWise.

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The content provided on Moneywise is information to help users become financially literate. It is neither tax nor legal advice, is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Tax, investment and all other decisions should be made, as appropriate, only with guidance from a qualified professional. We make no representation or warranty of any kind, either express or implied, with respect to the data provided, the timeliness thereof, the results to be obtained by the use thereof or any other matter.