States Where the Average Salary Isn’t Enough to Get By

Can you afford to get by on the average salary in your state? According to the 50-30-20 budgeting rule, 50 percent of your income should be dedicated to necessities such as rent and groceries, 30 percent should be dedicated toward discretionary spending and “splurges” and 20 percent should be put toward savings. But depending on where you live and how much you make, living by this expert-approved budgeting strategy might not actually be realistic.

GOBankingRates determined the states where the average salary isn’t enough to get by — comparing the annual expenditures using the 50-30-20 rule based on the cost of living by state to the state’s median household income — and in all but eight states, you wouldn’t earn enough to stick to this budget.

• Difference between income needed vs. actual income: $108

Texas’ median household income is $54,727, but the annual income needed is $54,835 — the ninth-lowest of all the states and just shy of the average salary in the U.S., which is $55,322. You’d easily be able to cover necessities ($27,417.50) and splurges ($16,451) earning the median income, but you’d fall short of being able to save 20 percent. Unfortunately, the difference between the average income and the amount needed to live comfortably could increase, especially in Texas cities where the cost of living is rising.

• Difference between income needed vs. actual income: $183

Thanks to a low cost of living — the income needed in Kansas is $53,754, the seventh-lowest in this cost-of-living comparison by state — you can almost budget perfectly with the state’s median income of $53,571, even though it’s below the median income in the U.S. But you’d fall just shy of being able to save 20 percent after covering the costs of necessities and discretionary spending. However, you might be able to save more money by downsizing.

• Difference between income needed vs. actual income: $345

You could easily cover necessities and splurges in North Dakota while earning the median household income of $59,114. But you’d fall short of being able to put away $11,892 — 20 percent of your income — for savings each year.

• Difference between income needed vs. actual income: $625

The income needed in Iowa is $55,195, which breaks down to $27,597.50 for necessities, $16,559 for splurges and $11,039 for savings, based on the 50-30-20 budgeting rule. The median household income of $54,570 falls a few hundred dollars short of enabling a household to stick to that budget.

• Difference between income needed vs. actual income: $1,712

In Nebraska, the median household income is $54,384 and the income needed to live by a 50-30-20 budget is $56,096. But that income needed is almost doubled for people living in the 68526 zip code, which is one of the most expensive zip codes in America.

• Difference between income needed vs. actual income: $2,197

In Washington, the median household income is $62,848, and the income needed is $65,045. But that number could rise, especially in cities like Seattle, which is one of the cities where the cost of living is soaring, a separate GOBankingRates study found.

• Difference between income needed vs. actual income: $2,251

The cost of living in Maryland is high — with total expenditures averaging $78,318, it’s the fifth-most expensive state to live in the U.S. However, the median income of $76,067 — the highest in the U.S. — is almost enough to cover needs and discretionary spending with 20 percent left over for savings.

• Difference between income needed vs. actual income: $2,286

The average annual expenditures in Delaware are relatively high, with $63,303 needed to cover necessities, splurges and savings. But the median household income is also on the higher end at $61,017, just not high enough to cover all your costs.

• Difference between income needed vs. actual income: $2,470

Average annual expenditures total $53,273 in Michigan, which has the third-lowest cost of living per state following a 50-30-20 budget. The median household income in the Great Lake State is $50,803, so it’s enough to put $26,636.50 toward necessities and $15,982 toward discretionary spending, but it wouldn’t be enough to put $10,655 toward savings.

• Difference between income needed vs. actual income: $3,228

Following the 50-30-20 rule, you’d need $28,919 to cover necessities, $17,351 for discretionary spending and $11,568 to put toward savings, for a total of $57,838. The median household income in America’s Dairyland is $54,610.

• Difference between income needed vs. actual income: $3,497

The income needed in Georgia is $54,534, the eighth lowest of all the states. But the median household income — $51,037 — is also low, so you wouldn’t be able to follow the 50-30-20 budgeting rule if you made the median amount.

• Difference between income needed vs. actual income: $3,800

Missouri is the fifth most affordable state to live in, with the average annual expenditures totaling $53,393 when the 50-30-20 budgeting rule is applied. But the $49,593 median household income falls short of being able to cover the estimated costs of necessities, splurges and savings.

• Difference between income needed vs. actual income: $4,175

Alaska is actually the fourth most expensive state to live in, with average annual expenditures totaling $78,619. But the second-highest median income of all the states — $74,444 — prevents Alaska from ranking lower on this list.

• Difference between income needed vs. actual income: $4,522

In the state of Indiana as a whole, the median household income is $50,433 and the income needed is $54,955. Unfortunately, the cost of living comfortably in Indianapolis is higher, and the median income is lower, a separate GOBankingRates study found.

• Difference between income needed vs. actual income: $4,581

Connecticut’s annual expenditures total $76,336 — the eighth-highest on this list. Fortunately, the median household income is the fifth highest of all the states at $71,755, which is enough to cover $38,168 worth of necessities and $22,901 in splurges, but it wouldn’t be enough to put an additional 20 percent toward savings.

• Difference between income needed vs. actual income: $4,995

Oklahoma’s annual expenditures total of $53,033 is the second-lowest in the nation. But the state also has the 10th-lowest median household income. The median income — $48,038 — is enough to cover necessities ($26,516.50) and splurges ($15,910), but it wouldn’t be enough to save 20 percent ($10,607).

• Difference between income needed vs. actual income: $5,002

Overall, the state’s median household income of $50,674 isn’t enough to cover annual expenditures. But you could live better if you lived in a city: Ohio is home to three of the cities where your paycheck stretches the furthest — Cincinnati, Cleveland and Toledo — according to a separate GOBankingRates study.

• Difference between income needed vs. actual income: $5,477

In Arizona, the median household income is $51,340 and the income needed is $56,817. But if you lived in Phoenix, you’d likely make a higher salary while still enjoying a low cost of living. It’s one of the cities with the highest salaries and lowest living costs in the nation, a separate GOBankingRates study found.

• Difference between income needed vs. actual income: $5,683

The average annual expenditures in Massachusetts based on the 50-30-20 budgeting rule total $76,637 — the seventh highest of all the states. But the median household income, $70,954, is the sixth highest, which prevents the state from ranking lower on this list.

• Difference between income needed vs. actual income: $5,886

Pennsylvania’s median household income is $54,895, and the income needed to stick to the 50-30-20 rule is $60,781. It could be even harder to stick to the budget if you make the minimum wage and live in Philadelphia: It’s one of the places where the cost of living outpaces the minimum wage.

• Difference between income needed vs. actual income: $6,502

Average wages are low in Idaho: The median household income is $49,174, and the income needed is $55,676, assuming $27,838 goes toward necessities, $16,703 goes toward discretionary spending and $11,135 gets put away into savings.

• Difference between income needed vs. actual income: $7,120

Tennessee has the sixth-lowest income needed of all the states, $53,964, but it also has the eight-lowest median household income. The median household income in the state — $46,574 — is enough to cover necessities ($26,847) and discretionary spending ($16,108), but it wouldn’t be enough to put 20 percent toward savings.

• Difference between income needed vs. actual income: $8,140

The median household income in North Carolina is $48,256, and the income needed to cover necessities, splurges and savings in the state is $56,396.

• Difference between income needed vs. actual income: $8,575

Alabama is the fourth-most affordable state to live in, with the average annual expenditures totaling $53,333. The median household income in the state is the fourth lowest overall at $44,758, which is enough to cover necessities ($26,666.50) and splurges ($16,000), but wouldn’t be enough to put 20 percent toward savings.

• Difference between income needed vs. actual income: $8,703

The median household income in South Dakota is $52,078, and the income needed is $60,781. But the difference between the two could decrease, as South Dakota is one of the states where cost of living decreased the most between 2017 and 2018.

• Difference between income needed vs. actual income: $9,922

Mississippi is the most affordable state to live in, with annual expenditures totaling $50,450. But it also has the lowest median household income — $40,528 — which isn’t enough to make the 50-30-20 budgeting rule work.

• Difference between income needed vs. actual income: $10,122

The median household income in New Mexico is $45,674 — that’s the seventh lowest among all states. Following the 50-30-20 budgeting rule, you’d need $27,898 for necessities, $16,739 for discretionary spending and $11,159 for savings, so you’d come up over $10,000 short of earning the median income.

• Difference between income needed vs. actual income: $10,444

Louisiana has the sixth-lowest median household income of all the states: $45,652. That’s just enough to cover necessities ($28,048) and discretionary spending ($16,829), but it’s not nearly enough to put an additional 20 percent ($11,219) toward savings.

• Difference between income needed vs. actual income: $10,499

The median household income in the Sunshine State is $48,900, but the income needed is $59,399. The gap between those numbers could rise, especially in cities like Jacksonville, which is one of the U.S. cities where the cost of living is quickly rising.

• Difference between income needed vs. actual income: $10,805

Kentucky has the fifth-lowest median household income in the U.S.: $44,811. That income is just enough to cover the average cost of expenses ($27,808) and splurges ($16,685), but only a couple hundred dollars would be left over for savings each year.

• Difference between income needed vs. actual income: $10,997

Arkansas is tied with Alabama for the fourth-lowest income needed, but the median income is lower — $42,336 vs. $44,758 — so Arkansas ranks lower on this list. The state has the second-lowest median income in the U.S.

• Difference between income needed vs. actual income: $12,141

South Carolina’s median household income is $46,898, the ninth-lowest in the U.S. It’s not enough to cover the average annual expenditures in the state, which total $59,039.

• Difference between income needed vs. actual income: $13,152

The income needed in Nevada is $66,246, but the median household income is just $53,094. The disparity between the two numbers could be even worse for people living in Reno — one of the U.S. cities with a low cost of living, but also low salaries.

• Difference between income needed vs. actual income: $14,022

A relatively low median household income — $48,380 — and a relatively high annual expenditure — $62,402 — make it hard to live by the 50-30-20 rule in Montana.

• Difference between income needed vs. actual income: $14,406

Vermont is an expensive place to live, with $35,255 needed to cover necessities alone. The median household income in the state is $56,104, so you’d fall far short of being able to cover both splurges and savings if you make the median earnings.

• Difference between income needed vs. actual income: $15,006

In Rhode Island, you’d need an average of $73,393 to cover necessities, splurges and savings. This state has the ninth-highest total expenditures of all the states. The median income is $58,387, which alone isn’t enough to cover necessities ($36,696.50) and splurges ($22,018), even if no income goes to savings.

• Difference between income needed vs. actual income: $15,494

West Virginia has the third-lowest median income of all the states — $42,644. That income is not enough to cover $29,069 for necessities, $17,441 for splurges and $11,628 for savings.

• Difference between income needed vs. actual income: $19,024

If you earn Maine’s median household income of $50,826, you would not make enough to cover necessities ($34,925) and splurges ($20,955), let alone contribute to savings.

• Difference between income needed vs. actual income: $19,679

New York has the third-highest income needed of all the states — $80,420 — with $40,210 needed to cover necessities and $24,126 needed for discretionary spending. The median household income of $60,741 comes up short of what’s needed.

• Difference between income needed vs. actual income: $20,902

You would need $84,685 for annual expenditures in California — the second-highest amount of all the states. However, the median income is $63,783 — the ninth highest of all the states, but still not enough to stick to the 50-30-20 budget.

• Difference between income needed vs. actual income: $24,808

Oregon is the sixth-most expensive state to live in, with $39,039 needed to cover necessities and $23,423 needed for discretionary income. If you were to put 20 percent toward savings, that would mean you’d need to earn $78,078 each year to cover all expenses. But the median income is just $53,270.

• Difference between income needed vs. actual income: $39,915

Hawaii is the most expensive state to live in: The average annual expenditures total $111,892, with $55,946 needed to cover necessities and $33,568 needed for discretionary spending. The median household income of $71,977 — the fourth highest in the U.S. — isn’t enough to cover those two costs, even without putting anything away for savings.

If you find yourself living paycheck to paycheck in Hawaii or any other state, follow these survival tips.

Living by the 50-30-20 budget is impossible in most states if you earn the median household income. However, how close you can get depends on not only the median income but also on the cost of living in the state.

In Virginia, Utah, Wyoming, Minnesota, New Jersey, New Hampshire, Illinois and Colorado, you can get by on the median income and still have some money left over.

The states where it’s the hardest to get by earning the average salary are:

1. Hawaii
2. Oregon
3. California
4. New York
5. Maine

Click through to read about why some money experts don’t use the popular 50-30-20 budget rule.

More on the Economy

• 35 Cities Where You Can Afford to Live Off Less Than $50,000
• Most and Least Recession-Proof States
• 15 Survival Tips for the Next Recession
• Watch: Why Your Next Home Will Be a Shoebox

Methodology: GOBankingRates found the states where the average salary isn’t enough to get by using cost of living data from Missouri Economic Research and Information Center, and multiplying the cost of living indexes by annual expenditure data from the Bureau of Labor Statistics. After, GOBankingRates broke down the annual expenditure amount for every state using the 50-20-30 rule: the amount of money specified for savings is equal to 20 percent of the total income needed, the amount specified for discretionary spending is equal to 30 percent of the total income needed and the amount of income specified for necessities is equal to 50 percent of the total income needed. Lastly, GOBankingRates found the difference between annual expenditures and median income for each state sourced from the U.S. Census Bureau to indicate the states where a median salary isn’t enough to cover cost of living expenses.