Why Earning $100,000 in California Is Considered Lower Middle Class

California residents who earn an income of $100,000 per year are now considered lower-middle class in the state.

A middle-class person is someone who earns around two-thirds to double the median income of their state. Using this definition, MoneyLion researchers broke the middle class into thirds and calculated the lower-middle-class income of each state.

Since the median household income in California is $100,149, they found that the “top income” for lower-middle-class households is $111,277 annually.

According to the Pew Research Center, a lower-middle-class household is one that earns less than two-thirds of the median income.

So, a California family that earns $100,000 may still be struggling financially.

California Rent Hikes

Over the past two decades, rent in California has increased significantly.

According to a 2019 study by RentCafe, rent prices from 2009 to 2019 increased by 65%.

Since 2019, these hikes have not slowed. The cost of living remains a primary concern for Californians.

A February 2026 analysis by Jonathan Lansner found that pay raises generally fail to keep up with rent increases.

In Los Angeles and Orange counties, income outperformed rent increases by only 0.2 percent. A similar result was reported for Sacramento.

Meanwhile, in San Diego and Stockton, rents outpaced earnings by 1.6 to 1.7 percent.

The widest gaps were seen in Fresno, the Inland Empire, and Bakersfield, where rent raises outdid pay increases by 3.1 to 3.8 percent.

The ‘30% rule’ suggests not spending more than a third of your income on rent, but this has become increasingly difficult in California.

It is not only rent where prices are higher. Compared to residents in other states, California residents spend 61% more money on utilities, 40% more on gas, and 11% more on groceries.

As a result, many Californians have left or are leaving the state.

Leaving California

In the past decade, approximately 10 million people have left California for other states.

A March 2026 California Policy Lab (CPL) report by researchers Brett Fischer and Evan White suggests that affordability is a main motivator.

“The price tag has gone up on the California Dream, and many families are leaving the state for more affordable places,” White said in a CPL press release. “The difference these moves make is stark. Their destination neighborhoods are half as expensive, and they end up much more likely to own a home within just a few years.”

While composing the report, the duo found that, on average, Californians moved to communities where rent costs are about $638 less per month.

Additionally, the median price for homes in their new states is about 48% lower, nearly half, than their Californian counterparts.

This difference in home costs may explain why seven years after leaving the state, “former residents are about 48% more likely (11-percentage-point difference) to own a home than similar Californians who stayed in the state.”