If you want paradise, then you will have to pay a pretty steep price. Hawaii is now listed as the worst state in America to make a living in.
Yes, the economy in Hawaii is fantastic and the jobless rate is low, but other factors put together by MoneyRates.com put Hawaii squarely at the top of the list of worst states in America to make a living in.
Think of the United States as a collection of mini economies, with each state being its own economy. Every state was analyzed to find out where workers have both the best, and worst shots at making a good living. These other 5 key factors were used in the formula:
- Average Wages
- State Tax Rate
- Cost of Living
- Unemployment Rate
- Incidents of Workplace Illness, Injuries, and Fatalities
The price you pay to live in Hawaii is extreme, in many areas. I grew up in the islands and it is home, I love it. That being said, the cost of doing business, paying rent, groceries, taxes… the laughable house prices… those all really add up. Sometimes it is a stretch to wonder how so many make it in Hawaii. I am sure it helps that Hawaii is consistently listed as the happiest and healthiest state in the nation. At least we know that while paying $1,600 per month average for a 350 square foot studio that we are still happy and healthy.
On a quick side note, Texas, Washington and Wyoming finished 1-3 as best states to make a living in. Not surprisingly, none of the states have state income tax.
Hawaii Worst State in America to Make a Living In
Here are the deciding factors and the reasoning behind Hawaii coming out as the worst state in America to make a living.
Hawaii: The islands of Hawaii may be a terrific place to spend a vacation, but they are a difficult place to try to make a living. Hawaii ranks as the worst of all states for making a living. Why? Cost of living is the main issue. Hawaii has the highest cost of living of any state. One of the biggest reasons why cost of living is so great in the state is higher than average housing expenses. According to Zillow, the median home value of a house in Hawaii is $537,300, which could price some buyers out of the market. Additionally, salaries in the state do not compensate for its high cost of living – the average wage in Hawaii is about typical for the rest of the nation. Hawaii has one of the highest income tax rates of any state. Adjusted for taxes and the cost of living, workers in Hawaii get the equivalent value of just 55 cents for every dollar they make. — MoneyRates.com
Hawaii’s cost of living index comes in at an eye popping 170.8, which again are mainly driven by housing costs. No, you don’t have to buy a home, but rent is also the highest in the nation as noted above. You can live in a walk in closet with a parking space for an average of $1,600 per month… no utilities included.
The estimated state tax on average income sits right at $3,073.77. An average income of $46,230 is in line with the rest of the nation. That same $46,230 is going to carry you and your family a lot further in most other states. When you take that number and adjust for taxes and the cost of living, workers in Hawaii get the equivalent value of just $0.55 for every $1.00 they make, as noted by the Money Rates quote above. If you do the math on $0.55 on the dollar that comes out to an average of income of $25,426.50, which is below the poverty line in Hawaii. At least we are happy and healthy!…