New data reveals most of America’s highest earners live in this state

Washington, D.C. and California have the most high-income households in the country, a GOBankingRates analysis of the just-released American Community Survey from the U.S. Census Bureau found. California has the most high-income households and the biggest increase year-over-year  of high-income households, while Washington, D.C. has the highest percentage of high-income households.

The American Community Survey is a comprehensive survey conducted annually covering a broad range of topics including financial, economic and housing. GOBankingRates zeroed in on the survey’s high-income household data. Several past GOBankingRates studies have found that the middle class is getting squeezed and wealth inequality is growing.

GOBankingRates determined which states have the most high-income households in absolute numbers and as a percentage of all households. For the study, high income was defined as households earning $125,000 or more a year. 

Read on to find out which states are home to the most high-income households in the U.S. 

RELATED: Take a look at the salary needed to buy a home in America's biggest cities:/strong>

Salary needed to buy a home in 25 biggest US cities
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Salary needed to buy a home in 25 biggest US cities

25. St. Louis, Missouri

Income needed for 20% down: $37,027

Income needed for 10% down: $41,655

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24. Atlanta, Georgia

Income needed for 20% down: $45,592

Income needed for 10% down: $51,291

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23. San Antonio, Texas

Income needed for 20% down: $47,158

Income needed for 10% down: $53,053

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22. Tampa, Florida

Income needed for 20% down: $48,013

Income needed for 10% down: $54,014

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21. Houston, Texas

Income needed for 20% down: $48,9678

Income needed for 10% down: $54,975

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20. Philadelphia, Pennsylvania

Income needed for 20% down: $48,948

Income needed for 10% down: $55,067

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19. Charlotte, North Carolina

Income needed for 20% down: $49,844

Income needed for 10% down: $56,074

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18. Dallas-Ft. Worth, Texas

Income needed for 20% down: $53,322

Income needed for 10% down: $59,988

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17. Chicago, Illinois

Income needed for 20% down: $53,973

Income needed for 10% down: $60,720

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16. Orlando, Florida

Income needed for 20% down: $54,116

Income needed for 10% down: $60,880

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15. Phoenix, Arizona

Income needed for 20% down: $55,479

Income needed for 10% down: $62,414

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14. Minneapolis-St. Paul, Minnesota

Income needed for 20% down: $55,845

Income needed for 10% down: $62,826

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13. Baltimore, Maryland

Income needed for 20% down: $61,216

Income needed for 10% down: $68,868

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12. Miami, Florida

Income needed for 20% down: $72,222

Income needed for 10% down: $81,250

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11. Riverside, California

Income needed for 20% down: $73,748

Income needed for 10% down: $82,967

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10. Portland, Oregon

Income needed for 20% down: $81,235

Income needed for 10% down: $91,389

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9. Sacramento, California

Income needed for 20% down: $84,683

Income needed for 10% down: $75,274

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8. Washington, DC

Income needed for 20% down: $86,667

Income needed for 10% down: $97,500

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7. New York-Newark-Jersey City, New York

Income needed for 20% down: $87,114

Income needed for 10% down: $98,004

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6. Denver, Colorado

Income needed for 20% down: $91,570

Income needed for 10% down: $103,016

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5. Boston, Massachusetts

Income needed for 20% down: $99,972

Income needed for 10% down: $112,468

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4. Seattle, Washington

Income needed for 20% down: $102,291

Income needed for 10% down: $115,078

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3. Los Angeles, California

Income needed for 20% down: $127,945

Income needed for 10% down: $143,938

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2. San Diego, California

Income needed for 20% down: $132,238

Income needed for 10% down: $148,768

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1. San Francisco, California

Income needed for 20% down: $201,205

Income needed for 10% down: $226,356

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States With the Most High-Income Households

California topped the list, adding over 250,000 households with incomes of $125,000 or more in just one year, for a total of 3 million households. Washington holds the highest percentage of high-income households, with over 31 percent earning $125,000 or more.

Here’s a breakdown of the top 10 states with the most high-income households. This scored ranking comes from a comprehensive analysis of each state’s percentage of households earning $125,000 or more against the absolute number of such high-income households.

California is home to dozens of America’s wealthiest cities. Eight large cities — those with more than 50,000 residents — have median household incomes in excess of $125,000, according to Census data:

  • San Ramon: $161,870
  • Palo Alto: $153,802
  • Pleasanton: $152,123
  • Mountain View: $135,115
  • Sunnyvale: $134,234
  • Yorba Linda: $132,952
  • Milpitas: $127,984
  • Fremont: $127,235

Hawaii only has 38,127 households earning $200,000 or more. But out of a total of 455,502 households in the state, that’s equal to 8.4 percent of all households. Hawaii is tied for the largest increase in $200,000-earning households, rising by 34.2 percent from 2015 to 2017.

Connection Between High Incomes and Inequality

A notable pattern among these states is wealth inequality. Five of the states with the most high-income households also possess the highest levels of wealth inequality in the country: Washington, D.C.; New York; Connecticut; California; and Massachusetts, in that order.

The Gini index is a metric used to gauge wealth inequality, with a value of 1 equal to complete inequality, and zero equal to complete equality. According to the most recent Census data, the national Gini index is 0.4815, so anything higher than that has wealth inequality that’s worse than the national average.

Here’s a breakdown of these states’ Gini coefficients and the percentage of households with incomes of less than $25,000 vs. the percentage of households with incomes of $125,000 or more. 

States with higher Gini coefficients than the U.S. average tend to have very high rates of low-income households — many are close to a fifth of all households.

Find out more about how wealth inequality is making it harder than ever to live comfortably in America.

More from GO Banking Rates:  
Here’s How Much the Average Person Makes in 30 Countries Around the World 
The 3 Cities With the Fastest-Growing Incomes Are in the South 
Many Americans Have No Idea What Income Class They’re In

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