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6 states where the minimum wage and cost of living offer the best bang for your buck

The highest state minimum wage in the U.S. is now $16.28 per hour, but some cities are even higher.

Map via Wikimedia Commons (multiple creators)

State minimum wages range from $7.25/hr to $17.00/hr in 2024.

Public discourse about minimum wage and living wages has been ongoing for years, with people debating whether the government should mandate a minimum hourly pay for workers. President Franklin D. Roosevelt signed the first federal minimum wage law in 1938, setting the lowest wage a worker could be paid at 25 cents per hour. Nearly a century later, the federal minimum wage is $7.25/hr, holding steady since 2009, with people lobbying to raise it to at least $15/hr for over a decade.

However, in addition to federal law, each state has its own laws, a handful of which establish a state minimum wage higher than $15, a handful of which don't have a set minimum wage at all and everything in between. Cost of living has also been a hot topic as inflation has squeezed everyone's wallets and certain cities and states have become utterly unaffordable, especially for people in low-wage jobs or who who are just starting out in their careers. So how do minimum wage and cost of living correlate state-by-state? Are there any sweet spots with a high(er) minimum wage and low(er) cost of living?

While there’s no perfect storm of super low cost of living and super high minimum wage—for instance, Washington, D.C. has the highest state minimum wage at $17/hr, but housing costs 140% more than the national average—there are some states where the ratio is far more favorable than others. According to Insider Monkey, here are the top six states where you can get the most bang for your minimum wage buck.

6. New Mexico

The Land of Enchantment offers a relatively decent living for its $12/hr minimum wage thanks to the state's below average cost of living. According to Rent Cafe, housing in New Mexico is 8% lower than the national average, monthly utilities are 9% lower, food is 4% lower, transportation is 3% lower and healthcare, goods and services are 2% lower.

According to Smart Asset, Albuquerque, New Mexico ranks as No. 10 in U.S. cities where minimum wage goes the furthest.

5. New Jersey

The Garden State's relatively higher-than-average cost of living is counteracted by relatively solid minimum wage of $14.13/hr. Most of the cost of living in New Jersey is wrapped up in housing, which is 30% higher than the national average, according to Rent Cafe, and utilities, which are 12% higher. Goods and services are 5% higher, but healthcare is 2% lower than the national average. Food and transportation are 1% and 2% higher, respectively.

4. Connecticut

With both a cost of living and minimum wage slightly higher than New Jersey, Connecticut rolls in at No. 4 with a $15/hr minimum wage. Where the Constitution State hits hardest is in utilities, which Rent Cafe places at 30% higher than the national average, and housing, which is 24% higher. Healthcare and goods and services are both 9% higher, while transportation and food are just 1% and 2% above average.

3. Missouri

The Show-Me State says, "Show me the money!" with its somewhat respectable $12/hr minimum wage, which goes pretty far with its relatively low cost of living. Housing is the biggest cost benefit Missouri offers at 18% lower than the national average. But utilities, food, healthcare, and goods and services are also all below average, with only transportation landing right at the national average.

Additionally, St. Louis clocked in at No. 5 for a minimum wage real-world value of $13.68 when adjusting for the city's lower-than-average cost of living.

2. Washington

With the highest state minimum wage in the nation (unless you count Washington, D.C.), Washington's $16.48/hr puts it in second place when accounting for cost of living. Make no mistake, Washington isn't cheap overall, with a cost of living 15% higher than the national average. Housing and transportation hit hard at 29% and 27% higher than the national average, respectively. Healthcare is pricey as well at 20% higher than average. Food costs 12% more, but utilities clock in at 7% less than the national average.

Two cities in Washington hit the top 15 for highest real minimum wage value, though, with Seattle at No. 13 and Spokane at No. 2.

map of united states with these states highlighted in green: Washington, New Mexico, Missouri, Illinois, New Jersey and Connecticut

These six states offer the best minimum wage to cost of living ratio.

Created with mapchart.net

1. Illinois

If you want the best bang for your minimum wage buck, head to the Prairie State with its $13/hr minimum wage and 8% lower than average cost of living. Housing in Illinois is 22% lower than average and utilities are 10% lower. The only expense that comes in higher than average for Illinois is transportation at 3% above average, which isn't enough to keep it out of the top spot.

However, there are some minimum wage sweet spots in certain U.S. cities that aren't reflected in these state rankings. According to Smart Asset, Denver, CO, is the city where minimum wage goes the farthest in the nation. Colorado comes in at a respectable 7th place in state minimum-wage-to-cost-of-living ratio, but Denver has its own mandatory minimum wage of $18.29/hr.

A citywide minimum wage is part of what puts Seattle at the No. 13 spot on that same list. Seattle is one of the most expensive cities in the U.S., but its $19.97 minimum wage for most workers changes the ratio in its favor.

Other cities in the top 10 include Buffalo, NY; Minneapolis, MN; Tucson, AZ; St. Paul, MN; Phoenix, AZ and Stockton, CA.

The minimum wage conversation may vary widely across the U.S., with different costs of living and different state laws on the books. But if you're looking to move someplace where your wage will go the furthest, these six states will likely be your best bet to check out first.


This article originally appeared last year.

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Pop Culture

Middle class families share how much money they have in savings and it's eye-opening

"I transfer money each paycheck but always end up needing to transfer it back."

Photo by Karolina Kaboompics/Pexels

Many middle class families are sharing that they have nothing in savings right now.

According to an April 2024 Gallup poll, 54% of Americans identify as part of the middle class, with 39% identifying as "middle class" and 15% identifying as "upper-middle class." That percentage has held fairly steady for years, but for many, what it feels like to be a middle class American has shifted.

Notably, inflation caused by the pandemic has hit middle class families hard, with incomes not keeping up with cost-of-living increases. Housing costs have skyrocketed in many areas of the country, mortgage interest rates have risen to levels not seen since the pre-Obama era and grocery bills have increased significantly. One government study found that cost of living has increased between around $800 and $1,300 a month depending on the state since 2021, putting a squeeze on everyone, including the middle class.

One woman shared that her family is just getting by and asked other people who identify as middle class to "chime in" with what they have in their savings account.

"I swear, every paycheck I am putting money into my savings, but needing to transfer it back within a few days," shared @abbyy..rosee on TikTok. "My registration is due. My husband's registration is due. He needed two new tires, even though they had a warranty. That's $300. My oldest needs braces, he needs a palate expander, that's $120 a month. Not to mention groceries are $200 more a week. Forget about feeding your family great ingredients because who has $500 a week to spend on perfect ingredients to feed your family?"


@abbyy..rosee

somethings gotta give #savings #middleclass #relatable

She explained that her husband makes enough money that they should be able to live comfortably, and that she quit her job because the cost of daycare was more than she was making.

"At some point, something has to give," she said. "What is going on? How do I save money?"

People in the comments chimed in with their savings account totals and it was quite eye-opening. Many people shared that they have $0 saved.

"We make the most money we ever have and have zero savings. We live paycheck to paycheck and every month I don’t know how we get by."

"I think the middle class is 1 personal disaster away from bankruptcy."

"Y’all got savings accounts?!?! 😂"

"I used to freak out if I had under $10k in savings, now I’m happy when I have over $150. 😫"

"We make almost 100,000 a year with no savings!!!! It's always something!!"

"I'm lucky if we have $500-$1K for an emergency. every single time we start saving something happens. the vet, the cars, the kids... something."

"Savings account? I transfer money each paycheck but always end up needing to transfer it back. My husband makes great money too but we are scraping by."

"$803 but we have to pay a $750 deductible this week b/c my Husband hit a deer soooo… back at it 😭 It’s exhausting. Constantly draining it, refilling it, transferring."

Some people shared that they do have some savings, but several said it was because they'd had an inheritance or other chunk of money come their way. Many people shared that their savings has dwindled as increased costs have taken their toll. Some people gave lifestyle advice to save money, but most agreed that just the basics have gotten so expensive it's harder to make ends meet much less put extra into savings.

Thankfully, the inflation issue appears to be waning, but even just plateauing at their current financial reality isn't ideal for many American families. Middle class is supposed to be a comfortable place to be—not rich, but well enough off to feel secure. That's not how many middle class folks feel, though. Most Americans don't have anything close to the amount of money saved that is recommended across the age spectrum, but at least hearing that others are in the same boat is somewhat comforting.

It can be vulnerable to put your financial reality out there, but it's helpful to hear what other people are doing and dealing with so we all feel less alone when we're struggling. Perhaps if people were more open about money, we'd all be able to help one another find ways to improve our financial situations rather than lamenting our empty savings accounts and wondering how to change it.


This article originally appeared last year.

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Frugal people share 13 silly money-saving tips that actually work.

Warning: These may involve some light stealing from work.

Unsplash

Most adults take a look at their lives somewhat frequently to try to figure out where they can save money. It might be cutting one of the streaming services we're not using or trying to dial back the Starbucks PSLs. However, the people on the subreddit r/frugal, take saving money to a whole new level.

A recent thread posted by u/Jskyesthelimit was chock full of solid gold advice for anyone looking to trim the budget but who doesn't want to put in a lot of work.

(Yeah, yeah — we all know meal-prepping is effective, but who's got the time? We're looking for easy wins, here.)

The prompt, "What's the little effortless, stupid thing you do that TECHNICALLY saves you money?", got some responses and tips you've probably never thought of.

They're small, they're silly — but they do add up.

1. Spend more time outside

"if i go outside and play all day, i don't have consumerist urges to buy stupid shit." - looney417

Can't spend money if you don't go into a store!

It's a good idea to get away from your phone or laptop for a while, too. If you're not careful, you can buy a hundred dollars worth of junk on Amazon before you even realize what's happening.

2. Time your dishwasher runs

"When our dishwasher is full and ready to be started, I set an alarm on my watch for 9pm. I start the dishwasher when the alarm goes off since the electricity rate goes down after 9pm." - misterfuss

A half loaded dishwasherNathan Dumloa/Unsplash

Did you know that electricity costs more during "peak hours"? Where I live, power can cost up to 4x as much from 2-7pm versus off-peak hours.

Most people run the dishwasher at night anyway, but you should look up your own local peak hours. Starting the nightly load at 9 instead of 8 every night could actually save you a couple of bucks a month.

3. Fill a large water bottle at work before you leave

u/MrPerfectionisback swears by this one.

Getting a gigantic, high-quality water bottle could be a great investment if you're able to top it off at the office every day and bring your water bill down a smidge.

4. Use less laundry detergent

Most of us approach laundry detergent with a "fill 'er up" attitude. But, usually, you can get away with even just one tablespoon if your clothes aren't that dirty. and using less will help your clothes last longer.

u/jbblue48089 also recommends using solid bar shampoo and dish soap, which have a longer lifespan than liquid soaps.

5. Re-wear clothes (other than socks and underwear)

Another option from u/ztreHdrahciR — don't wash your clothes at all! At least not right away.

Chances are you can get a few wears out of jeans or even t-shirts and save on laundry costs, to the tune of a few dollars per year.

6. Make your own doggie poo bags

"Use used food bags to pick up the dogs poop." - bezere

Poop bags are expensive! You could easily spend $20-50 per year depending on what brand you use.

Next time you pack a sandwich for lunch, save that plastic baggie and use it for pick-up duty later on.

7. Charge your phone at work (or wherever there's an outlet)

A good one from u/runmemymo.

Never pass up a chance for free electric!

If you don't work in an office, just carry your phone charger with you. Lots of restaurants and even public spaces have outlets so you can get a little free juice.

8. Poo at work (or wherever there's a bathroom)

u/larkfor says they save a ton of money each year on water and toilet paper by doing their business at work or the office.

Never pass up a chance for free water and toilet paper!

9. Cut sponges in half

yellow soapy spongePille R. Priske/Unsplash

u/plaincheeseburger recommends turning one sponge into two.

It will still work exactly the same and last twice as long.

10. Repair old dog toys

I love this one from u/pdxarchitecht!

My dogs love immediately ripping the stuffing out of new toys, which doesn't feel like a great value for my money.

The hack? Put the stuffing back in and add a stitch or two to close it up and save yourself $10 or more.

11. Twist the stems off of peppers if paying by weight

This ingenious and petty tip comes from u/casterix75.

Not all supermarkets charge by weight for bell peppers (or similar produce), but if they do, why pay for the stem? Twist it off and save yourself a few cents at the checkout.

12. Save the cold water when running a shower or bath

An old science teacher taught me this one in high school, recommended in this thread by u/smartquokka.

Put a bucket in the shower or bath to collect the cold water while it's heating up. Use that to water plants, fill the dog bowls, or flush the toilet.

13. Unplug everything at night

hands holding a plugKelly Sikkema/Unsplash

Many people recommended this — it's an r/frugal staple.

Appliances on standby still use power, so unplug as many things as possible before going to bed. u/Larkfor estimates this saves them $10 a month or so on power.

These tips are so small they're almost microscopic, but you know what? Most of them are so easy you'd barely notice a difference in your lifestyle and routine. And all together, you could save yourself a decent chunk of money every year by making a few simple changes.

Thanks to the thrifty people of Reddit for sharing their hacks with the rest of us!

This article originally appeared last year.

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Modern Families

Study ranks each American state by its living wage for a family of four. Over half exceed six figures.

Hawaii has easily the highest total

Photo credit: Canva

A study ranked all 50 U.S. states by living wage for a family of four. Over half of them exceeded six figures.

Let’s face it—it’s expensive to live anywhere in the U.S., and only those at the very top are cruising by. But it’s interesting to look at the data and see which areas of the country may offer the most financial breathing room.

A recent study by GOBankingRates crunched some numbers, breaking down the living wage in each state for a family of four. Per their methodology, they analyzed "annual living expenses" by using the 2023 Consumer Expenditure Survey data "for a married couple with children (oldest child 6-17) from the Bureau of Labor Statistics." The factored costs of living were "housing, groceries, utilities, healthcare, and transportation" (or "necessities"), and they defined "living wage" as "the income required to be able to cover 50% necessities, 30% discretionary/luxury spending, and 20% for savings."

Bugs Bunny counts his money Bugs Bunny Money GIF by Looney TunesGiphy

Some of the results are probably what you’d expect—others less so. The 10 cheapest and 10 most expensive are below, and the full list (with additional metrics) is available at the GoBankingRates site.

1. West Virginia (living wage for a family of four: $82,338)
2. Mississippi ($87,564)
3. Alabama ($87,607)
4. Kansas ($87,944)
5. Arkansas ($88,312)
6. Oklahoma ($90,659)
7. Iowa ($91,667)
8. Missouri ($91,669)
9. Tennessee ($92,179)
10. Kentucky ($93,349)

41. Arizona ($131,102)
42. Oregon ($131,824)
43. Vermont ($131,996)
44. New Jersey ($134,990)
45. Maine ($135,943)
46. Alaska ($136,990)
47. New York ($155,738)
48. California ($188,269)
49. Massachusetts ($199,671)
50. Hawaii ($258,918)

Twenty-six states exceed a six-figure wage. (The others not listed above are South Dakota, Illinois, Wyoming, North Carolina, Delaware, Wisconsin, Idaho, Virginia, Florida, Colorado, Nevada, Rhode Island, New Hampshire, Connecticut, Utah, and Washington.)


- YouTubewww.youtube.com

Of course, it’s one thing to analyze some numbers, but it’s also worth considering real-life experience. And if we consult Reddit, where opinions are never in short supply, a lot of people don’t agree with these findings. If you scan the r/coolguides subreddit, for example, you’ll find responses like this:

  • "Yeah, I call BS on this. I’m in CA with a family of 3 (me, wife, 4yo daughter), roughly making a combined $250k, and we’re still living with a tight budget"
  • "Maine more expensive than Connecticut? That doesn't seem right."
  • "This list is just very wrong. I live in the Midwest, and families due just fine making 40-50k. They live within their means."
  • "Need to see 'living wage' for NY State with data from NYC completely omitted... My family of four lives pretty comfortably on literally half that amount."

It’s a nuanced subject, not a one-size-fits-all situation. And even if you accept that, say, Hawaii requires the highest living wage for a family of four, there are plenty of other reasons you might want to live there. (I can think of about 15 off the top of my head.)

For example, let’s consult some of WalletHub’s recent reports. In September 2024, they published a breakdown of the "happiest states," analyzing "economic, emotional, physical, and social health" across 30 key metrics, from depression rate to productivity levels. Hawaii hit number one on that list, with residents citing "the highest levels of life satisfaction in the nation and the lowest depression rate." Massachusetts, meanwhile, came in at number 10.

Morgan Freeman applauds at the OscarsMorgan Freeman Applause GIF by The Academy AwardsGiphy

In August 2024, they assessed the "best states to live in" using 51 indicators of livability, ranging from housing costs to education rate to quality of hospitals. These are further broken down into broader categories of ""affordability," "economy," "education and health," "quality of life," and "safety." Massachusetts was number one, followed by Florida, New Jersey, Utah, and New Hampshire.

Massachusetts also took the top spot in two of the company’s other recent lists: one measuring the quality of school systems (factoring in "performance, funding, safety, class size, and instructor credentials") and another based on family-friendliness (factoring in "median annual family income, housing affordability, health care quality, crime rate, and school quality"). The state also topped Consumer Affairs’ September 2024 list measuring quality of public education.

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