A $70,000 salary is not the same offer in San Francisco as it is in Jackson, Mississippi. Housing, groceries, and services cost more in some states than others, so the number on your contract tells you less than you might think. What matters is how much that paycheck actually buys once local prices are taken into account.
The cleanest way to compare states is the Regional Price Parities series from the U.S. Bureau of Economic Analysis. It sets the national average at 100 and scores every state against it, so a figure of 110 means prices run about 10 percent above the national average, and 90 means about 10 percent below. The latest release covers 2024.
The cheapest and the most expensive states
On the 2024 data, the most expensive states to live in are California at 110.7, Hawaii at 110.0, the District of Columbia at 109.9, and New Jersey at 108.8. At the other end, Arkansas is the cheapest at 86.9, followed closely by Mississippi at 87.0, then Iowa and Oklahoma at 87.8.
The spread is wider than most people expect. Prices in California run roughly 27 percent higher than in Mississippi. Put another way, a dollar does about a quarter more work in Little Rock than it does in Los Angeles. Big states in the middle land where you would guess: Texas sits at 97.1, just under the national average, while Florida has climbed to 103.4 and New York reaches 107.9.
You can explore the full ranking and convert a salary between any two states with the US cost of living tool, or read a detailed breakdown for a single state, such as California or Texas.
A worked example
Say you earn $60,000 and live comfortably in Mississippi. To keep the same standard of living after a move to California, you would need about $60,000 multiplied by 110.7 divided by 87.0, which comes to roughly $76,300. That is a 27 percent raise just to stand still on buying power, before you have improved your life at all.
This is why a job offer that looks generous on paper can leave you worse off in practice. Always test a relocation offer against local prices rather than the headline number. The inflation calculator is useful here too, since prices in a single place also shift over time and a salary that felt fine three years ago may not stretch as far today.
What the price gap is mostly made of
Housing drives most of the difference between states. The BEA publishes a separate housing price parity, and it swings far harder than the parities for goods or other services. Groceries and gas vary by single-digit percentages between states, but rent and home prices can differ by half or more. That is why coastal states with tight housing markets sit at the top of the table and why a high-paying city can still feel expensive.
If a move is on the cards and a mortgage is part of the plan, work out what you could borrow in the new state with the mortgage affordability calculator before you commit to anything. Local price levels feed straight into how far a deposit and a monthly payment will go.
How to use these numbers well
Treat the price parity as a multiplier on your real buying power, not a verdict on a place. A state at 92 means your money goes about 8 percent further than the national average there, which can offset a lower local salary. A state at 108 needs a higher salary to match, but it may come with wages that are higher to begin with. The honest comparison is salary adjusted for prices, not salary alone.
FAQ
What is a Regional Price Parity? It is an index from the U.S. Bureau of Economic Analysis that measures the price level of goods and services in a state against the national average of 100. A value above 100 means prices are higher than average, and below 100 means they are lower.
Why is housing treated separately? Because rents and home prices vary far more between places than groceries or fuel do. Housing is the single biggest reason two states have different overall price levels.
Does a cheaper state mean I will be better off? Not always. Lower-cost states often pay lower salaries. What counts is your pay measured against local prices, which is exactly what the cost of living tool works out for you.
How current is this data? The figures here come from the 2024 BEA Regional Price Parities, which is the most recent full-year release. The BEA updates the series annually.
Two offers, same headline pay
Suppose two jobs both pay $70,000. One is in a state with a price level of 90 (cheaper than average), the other where it is 110 (pricier). Adjusted for local prices, the first salary has the buying power of about $77,800 at the national average ($70,000 / 0.90), while the second is worth about $63,600 ($70,000 / 1.10). The same paycheck stretches roughly 22% further in the cheaper state, which is why moving for a small raise can leave you worse off.
| Price level (RPP) | What it means | Buying power of $70,000 |
|---|---|---|
| 90 | 10% cheaper than average | about $77,800 |
| 100 | national average | $70,000 |
| 110 | 10% pricier than average | about $63,600 |
Run a real move with a state page such as California cost of living.
Where state taxes tip the balance
Price level is only half of what a paycheck faces. State income tax is the other half, and the two do not always point the same way. A handful of states levy no state income tax at all, and some of them are also cheap to live in. Tennessee sits at 91.9 on the 2024 parities and charges no state income tax, so a mover gains on both fronts. Texas, at 97.1, is close to the national average on prices but still keeps that tax off the paycheck. The lesson runs the other way too: Washington has no state income tax yet carries a price level of 107, so its higher cost of living eats into the tax saving. The honest test is take-home pay measured against local prices, which is why it helps to run the after-tax number for a specific state with the US paycheck calculator before comparing offers.
Sources
- U.S. Bureau of Economic Analysis, Regional Price Parities by State, 2024 release.
- U.S. Bureau of Labor Statistics, Consumer Price Index, for price-change context.