California’s high cost of living and tax burdens are putting a strain on residents, despite the state’s reputation for offering generous paychecks. A recent report from the US Bureau of Economic Analysis highlights how expenses in California are 11.2% higher than the national average, making it the most expensive state to live in. In contrast, Arkansas is considered the most affordable state, with costs 15.6% below average.
While Californians have the sixth-highest per capita income in the country at $81,300, the state also has the fourth-highest tax burden at 14.9%. This leaves residents with a spendable income of $61,400, ranked 26th among states. While some may argue that the state’s non-financial charms make up for the high costs, others point out that many residents, especially those earning below-average wages, struggle to make ends meet.
Despite these challenges, California continues to have one of the lowest rates of residents leaving the state. The report also highlights other states like Wyoming and South Dakota, which offer a better cost-and-tax-adjusted income for residents.
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