Tennessee’s median household income is nearly 15% below the U.S. average, but the Volunteer State is drawing a disproportionate number of wealthy families relocating to Tennessee, according to tax records.
A new study by the personal finance website SmartAssets found that Tennessee was among the top six states in attracting relocating families with households incomes above $100,000 in the year before the coronavirus pandemic hit the economy in 2020.
“Tennessee does not tax wages and earnings, meaning that upper middle-income class earners may be able to increase their savings rate,” said Stephanie Horan, a mortgage, savings and retirement expert for SmartAssets.
About 11,200 upper-middle-class people moved to Tennessee between 2018 and 2019, while less than 7,800 left Tennessee. In total, the net migration of upper middle-class people in Tennessee was 3,409.
Former Reagan administration economist Arthur Laffer, who moved to Nashville in 2006 in part to capitalize on lower taxes and cheaper costs, said his tax savings alone nearly paid for his move from California.