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10 cities where your paycheck goes the furthest

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Detroit Skyline at sunset

Many people dream of living in New York or Los Angeles — rubbing shoulders with celebrities and Instagramming food from the hottest restaurants. They dream of flashy jobs and fat paychecks.

That is, until they scroll through Craigslist or Zillow and determine they could never afford a fourth-floor walk-up above a noisy bar, let alone afford to buy a house in such an expensive city.

If “they” is really “you,” you might want to consider a midsize city where your paycheck will go the furthest.

More: I moved from a blue state to a red state and it changed my life

More: Planning: Why you shouldn’t rely on a retirement calculator

More: 10 states where graduate degrees boost your pay the most

10 cities with excellent cost-of-living ratios

For this list, we turned to a recent report by Glassdoor, which looked at salaries and housing costs for the 50 most populated metro areas across the US.

With that data, Glassdoor determined each city’s cost-of-living ratio — the median annual base salary divided by the median home value.

The results show that where you live and how much you make are directly related.

“Though there are certainly other financial factors to consider when taking into account total cost of living, this data reinforces that pay typically goes further in [midsize] cities versus big metropolitan areas, where there is often tighter competition for housing,” said Dr. Andrew Chamberlain, Glassdoor’s chief economist.

It probably won’t surprise you that New York City, Boston and San Francisco fared poorly, with ratios of 18%, 17%, and 11%, respectively. Some of the winners might surprise you, though. Here are the 10 cities where your paycheck will go the furthest.

10. Louisville

Cost-of-living ratio: 39%

Median base salary: $54,000

Median home value: $137,500

When most people think of Louisville, they think of big hats and baseball bats. But this city has a lot more going for it — not least of all is its southern charm.

UPS employs more than 20,000 people here, and the city has become a major center for the health care and medical sciences industries — both of which are growing fields with good pay.

9. Kansas City

Cost-of-living ratio: 39%

Median base salary: $58,000

Median home value: $147,500

Kansas City has the most expensive homes on the list and the second-highest salaries. You’ll find friendly people and a lot of love for the local baseball team here.

Jobs are available in health care, education, and government, and companies such as Garmin, Hallmark, and Sprint have headquarters in the larger Kansas City metro area.

8. Birmingham, Ala.

Cost-of-living ratio: 40%

Median base salary: $50,800

Median home value: $128,000

If you love barbecue, you’ll love Alabama. And Birmingham offers excellent restaurants, easy access to the outdoors, and passionate college football fans.

Its biggest industries are banking and insurance, health care, and logistics and transportation. Major employers include the University of Alabama at Birmingham, Regions Financial Corp., Honda and Mercedes-Benz.

7. Cincinnati

Cost-of-living ratio: 40%

Median base salary: $57,179

Median home value: $143,400

Even though I’m a Michigan grad and therefore not supposed to like Ohio, I have a soft spot for Cincy. My favorite activity is wandering the scenic riverfront park and then having a picnic while I watch the boats sail past.

Procter & Gamble, the University of Cincinnati, and Kroger are major employers here.

6. St. Louis

Cost-of-living ratio: 40%

Median base salary: $56,896

Median home value: $141,900

How aren’t more people flocking to St. Louis? This city’s got it going on.

Thanks to its large student population, it has a bumping nightlife and lots of nice cafes. Another highlight is the City Museum, which is basically a jungle gym for adults and kids.

Big industries include biotech and health care, and Boeing employs more than 15,000 people in the area.

5. Indianapolis

Cost-of-living ratio: 43%

Median base salary: $56,000

Median home value: $130,200

My friend’s dad — a well-traveled person — calls Indianapolis his favorite city. Although I’ll never fully understood that, I can see why it’s appealing.

I lived in this affordable city during middle school, and it offers Midwestern values, a healthy population of young people, quality sports teams, and a convenient location in the heart of the country.

Its major industries include health care, education, finance and tourism.

4. Cleveland

Cost-of-living ratio: 44%

Median base salary: $55,000

Median home value: $125,500

Downtown Cleveland is cool — and not just because it’s home to the Rock & Roll Hall of Fame. There’s a fun and active culture about the city, as evidenced by the many restaurants on the walkable East 4th Street.

Cleveland’s major industries are advanced manufacturing and health care.

3. Pittsburgh

Cost-of-living ratio: 45%

Median base salary: $56,896

Median home value: $126,700

With American Eagle, GNC, and Dick’s Sporting Goods headquartered in the area, in addition to several manufacturing and steel companies, incomes are good in Pittsburgh.

So if you want to be in the Northeast and close to major cities such as Philadelphia, New York, Boston and Washington, D.C., Pittsburgh makes an excellent home base.

2. Memphis

Cost-of-living ratio: 46%

Median base salary: $52,000

Median home value: $112,100

The birthplace of rock ’n’ roll has a lot going for it: a vibrant culture, mild winters, and excellent southern cooking. With a median home value of just over $110K — the lowest on this list — it’s clear you can get a lot for your money here.

Major employers include FedEx, International Paper, AutoZone and St. Jude’s Children’s Research Hospital.

1. Detroit

Cost-of-living ratio: 50%

Median base salary: $61,500

Median home value: $123,100

Detroit is on the upswing. I went to college nearby, and I know many people who moved back and are passionate about the city’s growth and success.

Quicken Loans and General Motors have headquarters here, and other major industries with employment potential include health care, finance and government.

Living as a millennial is not cheap. Veuer’s Natasha Abellard (@NatashaAbellard) has the story.Buzz60

How major expenses and income affect the cost of living

Although I’ve written before about the most affordable cities in the U.S., Glassdoor’s report provides a new angle on the issue by including income — because the combination of low-cost homes and decent incomes makes a compelling argument for midsize cities. Even if you take steps to drastically reduce your cost-of-living expenses, that pairing is hard to beat.

Still not convinced? The numbers might change your mind.

Let’s say you lived in San Francisco, where the median home value is $806,600, and saved 10% of your $88,000 median base salary. It would take you over 18 years to save a 20% down payment. If you lived in Detroit and saved 10% of your $61,500 income, it would take you only four to save for a 20% down payment on a $123,100 house. So the next time a flashy city calls, think about that.

If you’re ready to pack up and move to one of these affordable cities, it’s a good idea to check out mortgage loan offerings in the area first. Affordable housing is great, but it’s even better when paired with a loan that has a competitive APR. Check out Credit.com’s Mortgage Loan Center to learn more about available loan offerings.

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