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Where to grow up wealthy

By Judy Martel · Bankrate.com
Wednesday, July 31, 2013
Posted: 6 am ET

If you live and grow up in Atlanta, Memphis, Tenn., Indianapolis or Cincinnati, your odds of moving up the income ladder are lower than if you live in Seattle, Boston, Salt Lake City or New York.

A new study reported in The New York Times finds that metro areas in the industrial Midwest and the Southeast are among the worst for upward mobility, while the Great Plains, West and Northeast are among the best.

"Where you grow up matters," Nathaniel Hendren, a Harvard economist and one of the study's authors, told The New York Times. "There is tremendous variation across the U.S. in the extent to which kids can rise out of poverty."

Researchers analyzed a variety of factors and identified those that seem to affect upward mobility. It's not so much the actual geography, they found, but the nature of the community itself. Poor families living in mixed-income neighborhoods in metro areas with a larger middle class were more likely to move up the income ladder.

Other factors that propelled upward mobility among the poor families included being raised in a two-parent household, better school systems and higher participation in religious and community groups.

The study also found that children who moved at a young age from a metro area with low income mobility to one with higher mobility did as well financially as those children who spent their entire lives in high-mobility areas.

Not surprisingly, wealthy parents tended to raise children who became wealthy. A third of 30-year-olds who grew up with wealthy parents were earning at least $100,000, while only 1 in 25 of 30-year-olds whose parents were in the bottom half of the income distribution earned that much.

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1 Comment
freebird
July 31, 2013 at 10:58 am

I think it's all linked together-- income mobility correlates with lots of highly educated immigrants, rapidly growing businesses like technology, and booming real estate prices. In short it's the "blue states". Where I work in silicon valley, our team is about half immigrants from all over the world with American postgraduate degrees, and the other half are mostly transplants from flyover states looking for a better opportunity, not that many native born Californians in fact. I arrived here three decades ago from the midwest and was stunned by what my engineering degree could get me here compared to back home, so I never looked back. Multiply my situation by hundreds of thousands and this can explain a lot of what you see.

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