Even the wealthy have limits as to how much they’ll spend for creature comforts. And some states’ high cost of living can be a dealbreaker, causing even the wealthy to relocate.
According to a recent SmartAsset study, wealthy millennials are leaving certain states much more than others. So which states are they leaving — and where are they going?
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Here are five states wealthy millennials are leaving and where they’re going instead.
Also see the living wage a millennial needs to live comfortably in America.
Which States Are Millennials Leaving?
According to the study, California ranks as the No. 1 state wealthy millennials are fleeing the most. The Golden State is currently losing wealthy millennials in droves, thanks to the states dizzyingly exorbitant housing prices and cost of living.
As a recent Realtor.com article noted, the state’s complex and costly real estate infrastructure makes it difficult for millennials — even wealthy millennials — to stay for long.
“Property tax rules in California are a travesty,” 37-year-old wealth advisor Clint McCalla told Realtor.com, after having abandoned San Diego for Austin, Texas, with his family in 2023. “You currently have a system that provides legacy real estate owners and investors with a disproportionate benefit relative to new buyers. Combine that with a state that has refused to build new housing in any significant way for 20 years, and it creates the problem we now see.”
Don’t forget about cost of living as well. According to McCalla, “almost everything costs less in Austin.” McCalla said he didn’t think he’d ever be in a financial position that would allow him to get ahead while living in California.
He isn’t the only one. The SmartAsset study indicates that California lost 3,226 wealthy millennial households between 2021 and 2022 — more than any other state in the union. But California isn’t the only state with such an unfortunate exodus. Illinois (1,323 households), Massachusetts (1,102 households), New York (345 households) and Pennsylvania (320 households) were all close behind.
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Where Are They Going?
So with all those wealthy millennial households leaving, where are they choosing to go instead? Like the McCalla family, many are landing in Texas, which had a net gain of 1,660 wealthy millennial households, per the study. But you might be surprised to know that Texas didn’t take the top spot. Florida, which gained 1,786 such households, saw the highest influx of wealthy millennials.
Why the move to those two states? As SmartAsset noted, “High-earning households have the most to gain when it comes to minimizing income taxes,” meaning that wealthy millennials could find themselves rather comfortable in Florida and Texas — which have no state income tax whatsoever.
And let’s not forget about lower cost of living. Per Sperling’s BestPlaces, California’s cost of living is 49.9% higher than the national average, while Florida’s is just 3.1% higher and Texas’ is 5.8% lower. Housing is less expensive too, with California’s average home price being $773,363, per Zillow, compared with Florida’s $394,728 and Texas’ $301,627.
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This article originally appeared on GOBankingRates.com: Wealthy Millennials Are Fleeing California and 4 More States — Here’s Where They’re Going Instead
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