Creating wealth is a lofty goal that takes time and patience to achieve. What many people don't think about when they start to plan for it is that where you choose to live can make a surprising difference in your ability to hit your target.

If you’re ready to take your net worth to the next level, here are five cities that offer a combination of higher median household incomes, a lower cost of living and optimal tax rates. (For more, see 3 Simple Steps to Building Wealth.) If you weren't born in one of these places, it's worth checking them out as you think about your future. Even if you're well past your 20s, opportunities in these cities could still be worth exploring.


Houston gets a lot of attention from Millennials, who head here in search of jobs in the tech and oil sectors, but it’s a great choice for anyone who’s focused on building wealth. The cost of living is below the national average, but housing is very slightly above average compared to the rest of the country, though not as expensive as many other cities (see The 10 Most Expensive ZIP Codes in Houston). The median household income nears $46,000 annually, which isn’t too shabby. One nice perk is the fact that the state of Texas has no state individual income tax, which means you have more of your hard-earned dollars available to invest at the end of the day.     


When it comes to the cost of living, Baltimore is more than 12% cheaper than the rest of the U.S.. Compared to other states along the Eastern seaboard, Maryland is pretty reasonable on the tax front. The personal income tax rate is 5.75%, which is more than 3% lower than nearby Washington, D.C. Speaking of which, the nation’s capital is less than 40 miles away, making for a relatively easy commute for those employed by the federal government. If you plan to work closer to home, the median household income for Baltimore is a respectable $41,819. (For more, see Maryland’s 3 Most Affordable Retirement Communities.)         


Minneapolis has emerged as an 18-hour city, making it a hotspot for job-seeking Millennials, young families and retirees seeking a budget-friendly place to spend their later years. It offers a median household income of $50,767, almost as high as the national average, but a cost of living that’s 8% higher than the rest of the nation. One potential drawback is taxation: The personal income tax rate is 9.85%, which is something to keep in mind if you’re a high net worth individual earning a salary in the six-figure range. For general information, see Why '18-Hour Cities Are the Next Big Thing for Real Estate Investors.


Atlanta is another member of the 18-hour city club that’s gaining popularity among career-minded young adults and families. Home values have jumped by more than 16% over the last year, but housing won’t break the bank, whether you’re renting or buying. Median household incomes hover around the $46,000 mark, and the 6% personal income tax rate doesn’t put too much of a strain on your ability to build wealth. Unemployment is slightly higher than the national average, but job creation is on the rise. (For more, see What $200,000 Will Buy in the Atlanta Real Estate Market.)  

​Raleigh-Durham, N.C.

The Research Triangle region is a focal point of the Raleigh-Durham area’s economy, and it’s part of what makes both cities such desirable places to live for wealth-minded individuals. The median household income is $53,000, about equal to the national average. Like Maryland, North Carolina’s personal income tax rate is a moderately low 5.75%. Home values have held fairly steady over the last few years, so you won’t have to worry about housing costs draining money away from your investable assets. (For more, see 5 Best Real Estate Markets for 2016.)   

​The Bottom Line

Packing up and moving to a new city may seem like an extreme way to create wealth, but it can be worth it if it allows you to divert more money into building your portfolio. Paying less in taxes and reducing housing costs will free up more of your income, which you can use to create a brighter financial future over the long term.