Top 5 States Where You’ll Keep the Most of Your Paycheck in 2025
Written by
G. Brian Davis
Edited by
Laura Bogart
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Imagine you have a remote job that lets you work anywhere in the country. Which states offer the best deals, letting you lose the least money on taxes and living expenses?
To answer, compared states on total cost of living, median home prices, and total tax burden. “Total tax burden” refers to the average percentage of your paycheck that ends up lining state and local government coffers. That includes not just income tax but also property taxes and sales and excise taxes, as calculated by WalletHub.
Note that higher ranks for tax burden and cost of living ranks indicate lower costs. Thus, a tax burden ranking of 50 indicates the state with the lowest taxes.
Tennessee
- Median Home Price: $318,456
- Cost of Living Rank: 43
- Tax Burden Rank: 46
Tennessee has a lot going for it.
To begin with, it offers a lower cost of living than 42 other states. You can see that reflected in home prices, which make up the bulk of the difference in cost of living between states. For reference, the median home price nationwide is $355,328.
“Tennessee lures residents with a business and tax-friendly climate,” said Michael Elefanted, real estate investor and president of Home Team Vacation Rentals. “It boasts a lower overall cost of living compared to high-cost coastal markets.”
For urbanites, it also offers several major cities, a world-renowned music and culture scene, and famous food — especially barbecue. For outdoor enthusiasts, it offers outstanding hiking and other escapes in the Great Smoky Mountains and the Unicoi Mountains.
Consider it a top bargain state in every way.
Oklahoma
- Median Home Price: $204,155
- Cost of Living Rank: 50
- Tax Burden Rank: 42
Oklahoma has the lowest cost of living of any state in the nation. Nowhere is that more obvious than its median home price, just barely breaching $200,000.
Low property taxes and income taxes don’t hurt either. Only a handful of states offer a lower total tax burden than Oklahoma.
Don’t expect high mountains or coastal beaches, but you can still score some great hiking and camping around Black Mesa. Oklahoma City offers urban life, with a population of over 700,000.
Alabama
- Median Home Price: $224,911
- Cost of Living Rank: 46
- Tax Burden Rank: 38
It costs almost as little to live in Alabama as it does in Oklahoma. Only four states can brag a lower cost of living, and home prices remain shockingly affordable by today’s standards.
You won’t have to fend off the tax man at every turn either. “Alabama has lower tax rates and lower property values than most, letting you keep more of your money,” noted personal finance expert Erika Kullberg of Erika.com.
Unlike many of the most affordable states in the U.S., Alabama isn’t landlocked. Check out Dauphin Island, Fort Morgan, and Bon Secour National Wildlife Refuge for some “salt life.”
Wyoming
- Median Home Price: $350,224
- Cost of Living Rank: 34
- Tax Burden Rank: 48
Wyoming has grown more popular in recent years, seeing a surge in population and demand for housing. That’s driven home prices near the national average, unfortunately.
Still, it retains a lower cost of living than the bulk of the country. Crystal Stranger, senior tax director at OpticTax, points out that it charges no income tax and low sales and excise taxes. “Wyoming might be the most business and tax-friendly state right now and has a modest cost of living. So on a straight financial value, this may be your best bet for keeping more of your paycheck,” she said.
Florida
- Median Home Price: $385,541
- Cost of Living Rank: 22
- Tax Burden Rank: 47
Sure, Florida’s home price sits above the national average, and the overall cost of living ranks just below average. But those statewide numbers are skewed by the many major cities in Florida such as Miami, Jacksonville, Tampa, Orlando, and St. Petersburg.
“Florida has no state income tax, which is a major financial incentive for Americans looking to save,” said Raul Gastesi of Gastesi Lopez & Mestre, a law firm representing the cities of Miami Lakes and Doral. “The cost of living is also otherwise less compared to the northern states, and Florida maintains a balanced budget and a strong economy.”
You may not find towering mountains in Florida, but you’ll find everything else. Beyond the many options for city living, it also features countless smaller towns and seemingly endless coastlines. Surfers, boaters, anglers, scuba divers, and beach bums alike have plenty to love in Florida.
The U.S. is a big place, and no one says you have to stay where you are. You might just find your paycheck stretches farther in another state with lower taxes and cost of living.
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