Just as each state in the U.S. has its own unique identity and culture, they also vary by cost of living.
It’s expensive to live in Hawaii, for example, because it’s relatively small, which means housing supply is limited. Plus, since it’s a group of islands, many everyday items have to be imported from somewhere else, and retailers have limited competition motivating them to lower prices.
As a result, $1,000 won’t get you very far in Hawaii; it can only buy you about $892 worth of goods and services in the Aloha State, according to a U.S. Bureau of Economic Analysis comparison of prices nationwide.
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It’s even worse in California and Washington, D.C., BEA finds, where $1,000 is only worth around $875 and $872, respectively. One reason for that is because these places have notoriously high costs for many necessities, including rent and groceries.
Here’s the relative value of $1,000 in all 50 states and the District of Columbia:
The analysis doesn’t take into account factors like income tax, which could further decrease the spending power of every dollar you earn in some states.
While BEA’s price parity analysis covers all consumable goods, it reports that higher regional prices typically correspond with higher local rents.
That helps explains why your purchasing power depletes in states like Hawaii and California. As of March 2024, the average rents in Hawaii and California both exceeded $2,500 a month, according to RentCafe. Average rent prices were only higher in two states: New York and Massachusetts.
Residents of Hawaii also have to grapple with high grocery costs. Households there spend an average of $334 a week on food at home, the most of any state, according to a 2023 Census Bureau Household Pulse survey.
Similarly, Alaskan residents spend an average of $329 a week on groceries, and those in California shell out $298, the Bureau finds.
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