Advertiser Disclosure

News

America’s Biggest Boomtowns

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

iStock

The story of the United States is the story of people migrating to different cities and towns to build new lives through new opportunities. From the promise of gold to the promise of big tech in Northern California; from trading furs to building cars in Detroit; from the prosperity of shipping to the prosperity of hospitality in Charleston, the country is built on boomtowns.

We wanted to find out where Americans are gathering now to take advantage of growing prosperity and improved lifestyles to achieve the American dream.

Key findings

  • Austin, Texas; Provo, Utah and Raleigh, N.C., top our list of America’s boomtowns.
  • Scranton, Pa.; Syracuse, N.Y. and New Haven, Conn., fall to the bottom.
  • Americans are flocking to and prospering in Texas.
    • Texas metros take up one-third of the top 15 spots.
  • Parts of the Mountain region are also booming, comprising four of the top 15.
    • Two of the three Utah metros we reviewed are in the top 15 (Provo in 2nd place and Ogden in 12th), with Salt Lake City not far behind in 18th.
    • Denver came in 6th, and Boise, Idaho came in 8th.
  • The Carolinas are also attracting workers and businesses, with Raleigh taking the 3rd spot, Charleston the 4th and Charlotte the 13th. Durham, Raleigh’s neighbor, is in 16th place.
  • On the other end of the spectrum are the Northeast and some neighboring states, including Ohio, where four of six metros in our study saw their labor forces and the number of businesses shrink, and only one saw appreciable growth (Columbus, Ohio).
  • Every metro in Connecticut and Pennsylvania falls in the bottom quarter of our list, as did every metro in New York except for New York City. In fact, the only Northeast city to fall in the top half of our list was Boston.

The elements of a boom

To find out which of America’s metros are booming, we looked at how much each metro has changed between 2011 and 2016 (the most recent year for which all data is available at the metro level) in three different categories, which we scored independently before combining the results to reach a metro’s final score.

Growing industry

The first thing we looked at was how much business and industry has grown locally. We not only wanted to know how many new businesses there are but also how businesses in general are doing, as measured by their increase in hiring and — for businesses that don’t have employees, known as non-employers — how much revenue has increased.

More people and housing

The most essential component to a boomtown is this: Are people coming, and is the metro growing to keep up? To figure that out, we used the Census Bureau’s American Community Survey (ACS) to measure changes in total population and the number of housing units.

Growing workforce and employment opportunities

People generally enter a local workforce because they seek better opportunities, so we wanted to see how that changed, along with improvements to the unemployment rate and the increase in earnings.

Why some of our results might surprise you

Some of the metros that have been declared among the “fastest growing” in the news may fall lower on our list on than one would expect. For example, Greenville, S.C., has been touted as one of the fastest growing cities in America, but we see a population growth of 5.5% over the five-year period. Nothing to sniff at, but it’s the 13th highest on our list rather than in the top five.

One reason is that we looked at the five-year growth period rather than one year. Another is that the Census changed the area of some metros, so additional counties were added between 2012 and 2013. To make sure we were actually talking about the exact same footprint, we used and compared the data for counties that are currently in each metropolitan statistical area.

The biggest boomtown in America

These are the metros that are seeing the biggest influx of people, work opportunities and business growth.

1. Austin, Texas

Final Score: 87.8

Austin jumps way out ahead of all the metros we reviewed, showing the greatest five-year growth in population and housing, earning a perfect Population & Housing score of 100. Even so, the increase in housing units of 10% isn’t keeping up with the population growth of almost 16% over a five-year period. Interestingly, almost all of those gains in population have gone directly to the local workforce, and that, combined with a 23% drop in unemployment and an almost 9% increase in median wages, gives Austin the highest Workforce & Earnings score (70.3) on our list. While the metro comes in second for Business Growth, it’s with an A score of 93, thanks to a 21% increase in the number of businesses and a 24% increase in the number of employees those firms hired.

2. Provo, Utah

Final Score: 75.7

Business is booming in Provo, with 20% more businesses in 2016 than in 2011 employing 30% more workers. This gives the metro the top Business Growth score of 95.1. It also ranks high in Population & Housing, coming in third with a score of 79.9 thanks to a population increase of 12% and a housing increase of 8%. The Workforce & Earnings score is a respectable 52.2 (8th highest on our list), thanks to 13% growth in the workforce, and an OK drop in unemployment compared with other metros, at 20% (32nd). But wages don’t seem to be keeping up, as the median earnings for workers is only 3.5% higher than it was five years earlier (63rd).

3. Raleigh, N.C.

Final Score: 67.7

The second biggest population and housing increases — 13% and 9%, respectively — give Raleigh the second highest Population & Housing score of 84.1. North Carolina’s capital ranks No. 5 in Business Growth with a score of 70.8, boasting a 13% increase in establishments and a 21% increase in paid employees. Raleigh earned the 10th highest Workforce & Earnings score (48.3), thanks to 12% increase in the civilian labor force, which offset the mediocre (relative to the other metros on our list) 18% drop in the unemployment rate and a median earnings growth of under 4%.

4. Charleston, S.C.

Final Score: 66.4

Nipping at Raleigh’s heels, the historical coastal city saw its population jump by 11% between 2011 and 2016. The increase in housing units hasn’t kept up, at just over 6%, giving Charleston the fifth-highest Population & Housing score (66.9). The Business Growth score is the fourth highest on our list, at 71.7, due to a 14% increase in business establishments and 17% increase in paid employees (the fifth and 18th highest gains on our list, respectively). Charleston shines even more in Workforce & Earnings category, with a score of 60.6, the third highest on our list. The healthy 22% drop in unemployment and an 11% increase in the workforce (closely matching the overall population increase) are matched by the seventh-highest median wage increase of over 9%.

5. Nashville, Tenn.

Final Score: 60.7

Business is good in Nashville, where firms grew their staff by 21% (fourth highest), numbers that seem to be in excess of the 10% increase in establishment (22nd highest). That earned Nashville a Business Growth score of 72.9, the third highest among the metros we reviewed. It follows that the metro, which has long been diversifying from its country music legacy, has the fifth highest Workforce & Earnings score of 54.6, thanks to a 9% increase in workforce (ninth highest), a 25% drop in unemployment (14th highest), and 7% increase in median earnings for workers (16th highest). An interesting note is that the increase in the workforce is actually greater than the overall increase in population of just under 9% (14th highest), suggesting that the boom may be luring people to work. Although at 5%, housing growth isn’t keeping up with the influx of people, it is the 13th biggest increase on our list and adds up to a Population & Housing score of 54.5.

The most sluggish places

Not every metro is growing, and some are even contracting. These are the five most sluggish of the metros we reviewed.

100. Scranton, Pa.

Final Score: 9.9

Believe it or not, Scranton’s 0.4 Population & Housing score wasn’t the lowest on our list (Toledo, Ohio earned a perfect 0.0), but it is the result of a population drop of 0.4% and a 0.1% increase in housing units. At 14.3, Scranton had the third lowest Business Growth score (Pittsburgh and Syracuse, N.Y. fare worse at 13.2 and 14.1 respectively), thanks to an incremental 0.6% increase in business establishments. However, businesses did slightly better in hiring 5.5% more employees, the 15th lowest on our list. One bright spot is the rise in median earnings for workers — at 8.4%, it was the 11th highest of all the metros we reviewed. Unfortunately, it wasn’t enough to counter the 1.4% drop in labor force that presumably followed the drop in population, or the slight increase in unemployment (the fifth and sixth smallest gains on our list). That adds up to a Workforce & Earnings score 15.1, the 12th lowest on our list.

99. Syracuse, N.Y.

Final Score: 10.8

Business isn’t great in this upstate college town; only one other metro (Pittsburgh) got a score lower than Syracuse’s Business Growth score of 14.1. The metro saw no change in the number of business establishments, and businesses only increased their staff by 4% (the eighth lowest on our list). The population stayed steady with a 0.1% increase and was slightly outpaced by new housing units (0.9%), earning the metro a Population & Housing score of 4.6, the 12th lowest on our list. A 0.4% decrease in workforce and a marginal decrease in the unemployment rate of 3.2% offset the metro’s respectable 5.9% gain in median earnings (33rd highest), leaving Syracuse with the eighth-lowest Workforce & Earnings score (13.6).

98. New Haven, Conn.

Final Score: 11.6

People aren’t moving to this Ivy League community, and the people there seem to be leaving the workforce. Unemployment was down almost 9%, which seems great, but 72 other metros on our list saw bigger improvements, and 66 other metros had their median earnings increase by more than the 3% New Haven did. Business establishments grew by almost 2% in New Haven in five years (80th out of 100), but they only took on 5% more workers (90th place). That general stasis earned New Haven a score of 3 for Population & Housing (10th lowest), 13.9 for Workforce & Earnings (ninth lowest) and 17.9 in Business Growth (ninth lowest).

97. Cleveland

Final Score: 13.1

People seem to be leaving metros in Ohio, and Cleveland is no exception, experiencing a population decrease of just under 1%. In fact, it was the biggest population loss of all metros we reviewed. There was a small increase of 0.2% in housing units (fourth lowest), which is why Cleveland’s Population & Housing score of 1.1 came in ahead of Toledo, Ohio and Scranton, Pa. The number of establishments actually went down by about 1% (second only to Toledo’s loss of 1.4%), and the remaining businesses only increased their staff by about 4% (the fifth lowest gain). Overall, Cleveland’s Business Growth score of 15.6 was the sixth lowest on our list. On a brighter note, Cleveland earned a Workforce & Earning score of 22.7 (71st out of 100), thanks to a substantial 17% reduction in unemployment (46th out of 100) and over 4% more in median earnings (52nd), but these results were dragged down by a workforce that shrank by 1.4%, the fourth biggest loss on our list.

96. Hartford, Conn.

Final Score: 13.3

The good news is that median earnings for workers in Hartford went up by 6.6%, the 23rd highest on our list. The drop in unemployment was almost 9%, which seems like a lot, but 74 metros on our list did better. That, combined with a barely perceptible 0.3% increase in the workforce gave Hartford a Workforce & Earnings score of 20.6, which ranks 76th out of 100. Unfortunately, it’s downhill from there, with 90th place in the Population & Housing score because of a population growth of 0.3% and a housing unit increase of 0.6%. Connecticut’s capital had the 5th lowest Business Growth score of 15.1, thanks mostly to a lackluster 7% increase in receipts by non-employer businesses (second lowest on our list).

Comparing the 100 biggest metros in the U.S.

Methodology

Limiting our research to the current 100 largest metropolitan statistical areas (“MSAs”), we tracked the five-year change between 2011 and 2016 (the last year for which all data was available) using data from the U.S. Census American Community Survey and County Business Patterns in the following categories:

Population & Housing:

  • Total population
  • Total housing units

Workforce & Earnings:

  • Total civilian labor force
  • Unemployment rate
  • Median earnings for workers (dollars)

Business Growth:

  • Number of establishments
  • Paid employees per pay period
  • Total receipts for non-employers

Because the U.S. Census has changed the boundaries of some MSAs in the intervening years, we collected the data at the county level and then mapped it to the current MSA borders.

Each data series was scored relative to the other metros so that the biggest positive change received a score of 100 and any zero or negative changes received a score of 0 (except for unemployment rate, where this was reversed). For each category, these scores were summed and then divided by the number of series in each category, for a highest possible category score of 100 and a lowest of 0. The three category scores were then summed and divided by three for a final score. The highest possible final score was 100 and the lowest was 0.

How the metros have changed

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Kali McFadden
Kali McFadden |

Kali McFadden is a writer at MagnifyMoney. You can email Kali at [email protected]

TAGS: , , ,

Advertiser Disclosure

Mortgage, News

We Downsized Our House So We Could Travel the World

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Purchase agreement for house

You’ve settled into your dream house and have called it home for years. But now you realize your family has more house than it actually needs, plus a large mortgage to match. Is it time to downsize?

The answer depends on what your financial and lifestyle goals are. Below, we share one story about a Florida-based family downsizing their home. Giving up 1,600 square feet allowed them to pay off their mortgage in a fraction of the time and achieve their goals of globe-trotting.

Keith and Nicole’s downsizing story

Keith and Nicole DeBickes loved their house in Delray Beach, Fla., but with more than 3,500 square feet of living space, it was perhaps larger than they actually needed at the time. “One day, I came to the realization that I had a 400-square-foot bathroom that I spent 20 minutes a day in, and we had this big formal dining room and formal living room that we never used,” Nicole said. “And we had a really big mortgage to cover it.”

She also wasn’t thrilled with the schools in the area — or with the idea of paying for private education. She and Keith knew they had to make a change.

The DeBickes (who work as an engineer manager and software engineer, respectively, and make between $100,000 and $200,000 combined annually) put their house on the market and started looking for a smaller home that was zoned for better schools.

They eventually settled on a 1,900-square-foot, four-bedroom house in Boca Raton. “We wanted to buy with the idea that we’d have a much smaller mortgage and we wouldn’t have to pay for private school,” Nicole said. “Then we could do things with our family like travel or retire earlier.”

The couple took out a 30-year mortgage for $110,000 in 2007, much smaller than what they had before. They then refinanced into a 15-year loan for $150,000 in 2009 to remodel their kitchen and upgrade their electrical work.

Pros and cons of downsizing your home

Deciding to downsize your house is a major decision that takes a good amount of effort and planning. Consider the following pros and cons before you choose to move forward.

Pros

  • Reduces your mortgage debt.
  • Potentially reduces other housing-related expenses, such as utilities.
  • Frees up cash to reduce or eliminate non-mortgage debt.
  • Gives you a smaller house to maintain.

Cons

  • Reduces your available square footage, giving you less space than you’re used to.
  • Unless you have enough equity to cover the purchase of your new home, you must qualify for a new mortgage.
  • You’ll have to sell your existing home.
  • You will have to shell out thousands of dollars for both your home sale and new home purchase.

Tips to pay off your mortgage more quickly

The DeBickes didn’t like the idea of having a mortgage on their downsized home. “We didn’t want to be working every month for a mortgage,” Nicole said. “We don’t like debt, and we wanted it to be gone.”

The couple buckled down and started making double and triple payments every month on their home loan. They drove older cars, carpooled to save on gas and maintenance and packed lunches to cut down on their food costs. The family took relatively modest vacations, staying with family or driving to the west coast of Florida.

All their diligence paid off — the DeBickles submitted their last mortgage payment in fall 2013.

If you’re on a mission to be mortgage-free sooner rather than later, here are tips to help you get there:

  • Make extra principal payments each month. Try rounding up your monthly mortgage payment. For example, if your payment is $1,325 every month, pay $1,400 instead or increase the amount by even more, if your budget allows. Be sure to communicate to your lender that you want the extra payments applied to your principal balance and not your interest.
  • Pay biweekly instead of monthly. Split your monthly mortgage payment into biweekly payments. Since there are 52 weeks in a year, you would make 26 half payments, or 13 full payments. Making one extra full payment each year could allow you to shave a few years off your mortgage term.
  • Consider recasting your mortgage. If you have at least $5,000 or $10,000 — depending on your lender’s requirements — you could use that lump sum to recast your mortgage. A mortgage recast allows you to lower your monthly payments by paying your lender a set amount of money to reduce your mortgage principal.
  • Dedicate windfalls to paying down your principal. Every time you get a tax refund, bonus or some other windfall, use it to pay down your outstanding loan balance.

Achieving financial freedom

Although they’re now mortgage-free, the DeBickes were still putting money away like crazy. They eventually quit their jobs (temporarily) and traveled abroad for two years with their boys, who were 10 and 7 in 2015. Without a mortgage payment, they were able to amass the $190,000 they thought they needed to travel for 28 months. “We have been living on one salary and saving or paying off the house with the other for 12 years,” Nicole said.

Despite their hefty savings goals, they’ve been able to take the boys to Europe and Costa Rica, too. “We want to really get them prepared for what travel is going to be like,” Nicole said.

The trip, which is outlined on the family’s website, FamilyWithLatitude.com, took the foursome everywhere from Ireland to France, among other spots. Nicole and Keith “road schooled” their children as they traveled, with the help of Florida’s virtual school program that allows them to take classes online.

They planned to rent their home while they were away, which will help finance part of the trip and cover some house expenses, such as insurance and property taxes. In the meantime, they are maxing out their 401(k)s and taking care of college funds for the boys.

“(In 2014) we were able to purchase the prepaid college plan for my youngest son in a lump sum,” said Nicole, who had already done the same thing for her eldest. “So I know that both boys have good college funds to take care of them.”

The bottom line

If you’re looking to move into a smaller home and save money in the process, it might make sense for you to downsize. Just be sure you’re clear on the benefits and drawbacks, and how the choice to cut down your square footage would align with your personal goals.

In the end, the lack of debt will allow the DeBickes the freedom to not only to travel the globe, but to hang out with the important people in their lives.

“With both of us working, we haven’t been able to spend as much time with the kids as we wanted,” Nicole said. “It’s a real luxury that we can do this. I’m looking forward to spending time together as a family.”

This article contains links to LendingTree, our parent company.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Kate Ashford
Kate Ashford |

Kate Ashford is a writer at MagnifyMoney. You can email Kate at [email protected]

Crissinda Ponder
Crissinda Ponder |

Crissinda Ponder is a writer at MagnifyMoney. You can email Crissinda here

TAGS:

Advertiser Disclosure

News

Study: Millennials Depend on the Bank of Mom and Dad

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Millennials are advancing steadily into middle age. But statistically speaking, America’s largest generation retains one characteristic of their youth: Widespread dependence on their parents to help pay the bills.

A new survey reveals that even millennials who think of themselves as independent on money matters still hit up their parents for regular, recurring expenses. Of those surveyed, 54% claimed they stood on their own two feet, but when pressed a further 30% of those admitted to leaning on their parents to help cover costs on everything from groceries to car insurance.

The costs being covered by parents

For the most part, millennials aren’t hitting up their parents for cash to cover extravagant, one-off charges like airfare for an Instagram-worthy vacation. Instead, the survey found millennials ask mom and dad for help making ends meet for living expenses, such as the phone bill, food and rent. For example, of the millennials who receive monthly help from their parents, 48% of respondents say the money helps cover the phone bill. A more detailed breakdown can be seen in the graph below:


Besides these day-to-day costs, emergency spending requires a call home for some millennials. About 15% of all survey respondents said they would need help from their parents to cover a sudden $1,000 expense. Instead, most would opt to use either cash or savings, provided those savings weren’t earmarked for retirement in a tax-advantaged account.

Millennial money worries

Dipping into your emergency fund to repair a hole in the ceiling is a good strategy (and a reason why you save), while making a withdrawal from your savings account to pay for a bottle of rosé is not. Unfortunately a staggering 70% of millennials surveyed admitted to using savings to cover non-emergency expenses.


To use a favorite phrase of millennials, “this is problematic.” A savings account can only be drawn upon six times a month via debit card or check (due to federal regulations) and you don’t want to waste one of your six free withdrawals to pay for a pint of Americone Dream. Even worse, the money spent on non-emergency expenses won’t be there when you need it to pay for an unexpected, urgent cost.

Another metric of financial health where millennials could stand to improve is retirement savings. While 58% of the millennials surveyed claimed to save money with either each paycheck or once a month, 44% don’t have any sort of retirement savings account — either a private one or through work.


To be fair, millennials aren’t exactly celebrating these personal finance failures. Approximately 57% said they regretted how they’ve spent money from their savings account, and a little over 36% said that during the past week, they felt anxiety about their finances every single day.

The numbers behind the stress

A significant financial worry on millennials’ minds is not having enough money. While we’re pretty sure everyone, regardless of age, would like to have more money, a recent study by the Federal Reserve underscores that millennials are particularly hard-strapped for cash.

Titled “Are Millennials Different?”, the report found when compared to members of Generation X and Baby Boomers when they were roughly the same age as today’s millennials, the millennials have less means to deal with their financial challenges.

As the authors of the report put it in the conclusion of the report, “We showed that millennials do have lower real incomes than members of earlier generations when they were at similar ages, and millennials also appear to have accumulated fewer assets. The comparisons for debt are somewhat mixed, but it seems fair to conclude that millennials have levels of real debt that are about the same as those of members of Generation X when they were young and more than those of the baby boomers.”

How can millennials do better?

Besides winning the lottery, what else can millennials do to improve their financial situation and rely less on their parents?

“Many millennials are skeptical of the market,” said Dallen Haws, a financial planner based in Arizona. “Although it’s good that they are not investing willy-nilly, it will be very important that they get comfortable with investing to be able to reach their full financial potential.” Read more on how millennials (and everyone else) can start investing with an eye toward retirement.

Millennials should also embrace the power of austerity. That doesn’t mean living like a monk, but it does mean thinking twice (or thrice) about making big-ticket purchases and whether or not they are affordable.

“Without question, the biggest regret amongst millennials I work with is overpaying for a car,” said Rick Vazza, a CFA/CFP based in San Diego. “Some of my most successful young members have happily continued holding on to inexpensive cars allowing them to funnel more money toward travel, retirement funds or a down payment.”

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

James Ellis
James Ellis |

James Ellis is a writer at MagnifyMoney. You can email James here

TAGS: