Arizona Ranks among the Most Expensive States to Live In

A new study has revealed the most expensive states to live in based on disposable income adjusted for each region’s cost of living. Arizona has the fourth lowest purchasing power in the country. Arizona’s average annual disposable income is just $55,333, which is 2.9% lower than the national average.

The study, conducted by QR Code Generator, utilized state-by-state economic data from the Bureau of Economic Analysis (BEA) and the Missouri Economic Research and Information Center. The research analyzed each state’s average annual disposable income (a person’s income after taxes) and the cost-of-living index to create a ranking of states by purchasing power. Each state received a purchasing power score on a scale of 100. Each state received a purchasing power score out of 100. Lower scores indicate more expensive areas with less disposable income after adjusting for cost of living.

The cost-of-living index is standardized at 100, representing the national average. Scores above or below 100 indicate a state’s cost of living relative to this average. For instance, a score of 90 means the cost of living is 10% lower than the national average.

Ranking as the state with the worst purchasing power, Hawaii scored 0 out of 100 overall. This is due to its distinctly average annual disposable income of $57,427, which cannot compete with a cost of living that is more than 86% higher than the average state’s.

In second place, although notably better than Hawaii, South Carolina has a pitiful purchasing power score of just 32.5 out of 100. The state suffers from both a high cost of living – 13.4% above average – and a low annual disposable income of just $50,345.

California ranks third, scoring a dismal 38.9 out of 100 for purchasing power. Despite earning 16.6% more than the average state, with an average annual disposable income of $68,267 a year, the cost of living in California is a staggering 45% higher than the national average. This means that although residents earn more than in other states, their money doesn’t stretch as far.

In fourth place, Arizona scored 46.1 out of 100 for purchasing power. Residents suffer from a slightly above-average cost of living, at 110.5, and a disposable income of $55,333, which is around 2.9% below the national average.

Oregon has the fifth lowest adjusted disposable income, with a score of 46.4 out of 100. The average annual disposable income per capita is 0.64% above the national average, a respectable $57,306. However, this isn’t enough to combat the cost of living, with Oregonians paying more than 14% more to live in the state.

In sixth place is Mississippi, with an overall purchasing power score of 46.7. Residents in Mississippi benefit from a cost of living that is 11.7% below the national average. However, the state’s disposable income is the lowest in the country, at just $44,436 annually, meaning the cost of living is, unfortunately, still too high for many.

The state with the seventh-worst disposable income is Maine, where an average income combined with an above-average cost of living means the state scored just 47.7 out of 100 for purchasing power. Maine’s average disposable income is less than 1% below the US average, but the cost of living is 11.3% over the national average, making it difficult for Maine residents to afford necessities.

In eighth place, Massachusetts residents face a purchasing power score of just 49.5 out of 100. While the state’s average disposable income is a substantial $74,342 annually, it is significantly offset by a 44.3% increase in the cost of living compared to the US average.

Vermont ranks ninth, with a nearly average annual disposable income of $59,330, but the cost of living is 14.7% above the national average, resulting in a low overall purchasing power score of 50 out of 100.

Rounding out the bottom ten states for disposable income, Idaho residents have a below-average annual disposable income of $52,950 – 7.5% below the national average.

States with the lowest disposable income (adjusted to cost of living):

Rank	State	Annual Disposable Income	Cost of Living Index Score	Purchasing Power Score (Out of 100)
1	Hawaii	$57,427	186.2	0.0
2	South Carolina	$50,345	113.4	32.5
3	California	$68,267	145	38.9
4	Arizona	$55,333	110.5	46.1
5	Oregon	$57,306	114.1	46.4
6	Mississippi	$44,436	88.3	46.7
7	Maine	$56,489	111.3	47.7
8	Massachusetts	$74,342	144.3	49.5
9	Vermont	$59,330	114.7	50.0
10	Idaho	$52,950	101.1	51.6

On the other end of the scale, the study also revealed the states where residents have the most disposable income.

Ranking in first place, residents of Wyoming have the strongest purchasing power in the US, with a top score of 100 out of 100. The state has a high annual disposable income of $69,039, the eighth highest in the country and over $9,000 higher than the national average.

What’s more, Wyoming has a relatively low cost of living, ranking among the cheapest 50% of states. This combination of factors makes Wyoming the state with the best purchasing power.

North Dakota has the second-best purchasing power, scoring 99.3 out of a possible 100. The cost of living in North Dakota is reasonably low, with an index score of just 92.8, compared with the national average of 100. Additionally, the average annual disposable income in North Dakota is $67,093, making it another state where salaries stretch further.

Colorado ranked third, with a purchasing power score of 89.3 out of 100. Despite a slightly above-average cost of living at 101.8, the state’s high average annual disposable income of $69,353 secures its position firmly in the top five.

With a purchasing power score of 86.1, fourth place goes to the state of Illinois, where the average annual disposable income is $62,317. Although this is lower than in other states, the cost of living in Illinois is also 6.7% lower than the US average.

In fifth place, Minnesota received an overall purchasing power score of 85.2 out of 100, thanks to its impressively low cost of living. While the state’s average annual disposable income is only $2,664 above the national average, its lower cost of living score of 94.8 allows Minnesotans to enjoy a higher quality of life.

South Dakota ranks sixth with an overall purchasing power score of 84.8 out of 100. The state offers a slightly above-average annual disposable income of $64,656, a respectable $4,357 more than the national average. Additionally, its 2.4% below average cost of living means salaries can stretch further than in other states.

In seventh place is Texas, where a relatively low average disposable income is offset by an even lower cost of living. On average, residents receive an annual disposable income of $59,422. However, the state still scored an impressive 83.7 for overall purchasing power, mainly due to its cost of living being nearly 10% below the national average, with an index score of 90.3.

Eighth in the ranking is Nebraska, where the average resident has an annual disposable income of $61,114 – 1.35% above the national average. In addition, the cost of living in Nebraska is 6.6% lower than the average state.

Connecticut ranks ninth and stands out from the rest of the list. Despite a high cost of living, averaging over 13% more than the national average, the state’s formidable average annual disposable income of $73,888 propels it into the top ten. In fact, Connecticut residents are the second-highest earners in the US.

Rounding out the top ten is Kansas, where residents enjoy an incredibly low cost of living: 12.7% lower than the average US state. This, combined with an annual disposable income barely 5.6% lower than average, means that Kansas residents are able to live well from their wages.

States with the highest disposable income (adjusted to cost of living):

Rank	State	Annual Disposable Income	Cost of Living Index Score	Purchasing Power Score (Out of 100)
1	Wyoming	$69,039	95.1	100.0
2	North Dakota	$67,093	92.8	99.3
3	Colorado	$69,353	101.8	89.3
4	Illinois	$62,317	93.3	86.1
5	Minnesota	$62,963	94.8	85.2
6	South Dakota	$64,656	97.6	84.8
7	Texas	$59,422	90.3	83.7
8	Nebraska	$61,114	93.4	82.8
9	Connecticut	$73,888	113.2	82.5
10	Kansas	$56,940	87.3	82.3

Commenting on the findings, Marc Porcar, CEO of QR Code Generator PRO SL, says: “According to a recent survey, more than three in four Americans (77%) feel anxious about their financial situations. This highlights the importance of identifying states where living expenses are more manageable and disposable incomes are higher.

“States like Wyoming, North Dakota, and Colorado are top choices for those seeking higher disposable incomes and reduced financial stress, offering greater financial freedom and a higher standard of living to their residents.

“In contrast, states such as Hawaii, South Carolina, and California are less favorable options for those looking for either more disposable income or a more affordable lifestyle. These findings highlight the variability in living expenses across the US and the ongoing challenge many Americans face in balancing essential costs with disposable income for luxuries and savings.”