Recently, GOBankingRates sourced information from the Missouri Economic and Research Center and the Bureau of Labor Statistics to determine the median household income vs. the cost of living for each state. Having culled that information, GOBankingRates found that there are 14 states with a median household earnings level that falls beneath $70,000.
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That income level can make abiding by the 50/30/20 rule — a budgeting ethos in which 50% of your income goes to essential expenses, 30% goes to wants and non-essentials and 20% is used for debt payments and savings — rather tough. In fact, there isn’t a single state amid the 14 in which cost-of-living expenses are only 50% or less. As a result, committing to the 50/30/20 can be rather difficult in these 14 states, most of which are in the South.
Curious whether your state is on the list? Find out where the median income is $70,000 or less.
Montana
- Median household income: $69,922
- Annual cost of living: $51,458
While Montana’s nickname might be the Treasure State, it certainly doesn’t have the richest household-income-to-cost-of-living ratio. Nearly 74% of the state’s median household income is devoured by the cost of living. After putting aside an additional 20% for savings, that leaves next to nothing left over for residents who have average incomes.
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North Carolina
- Median household income: $69,904
- Annual cost of living: $43,429
While not nearly as bad as Montana, North Carolina is another state in which the cost of living outstrips more than 50% of the state’s median household income. In this case, that cost of living eats up about 62% of the average income, once again making it difficult to pay off debts, save and still have a little spending money left over.
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Ohio
- Median household income: $69,680
- Annual cost of living: $36,560
The Buckeye State has a far easier cost of living compared to Montana and North Carolina, taking up roughly 52% of the overall median household income. That’s a ratio far more accommodating to the 50/30/20 rule, allowing residents a much easier time of settling debts, putting some cash back and still having a bit of spending money left over.
Missouri
- Median household income: $68,920
- Annual cost of living: $36,833
Missouri is, much like Ohio, a state with a far softer median-household-income-to-cost-of-living ratio. The average cost of living in the Show Me State digs into only about 53% of the median income, allowing residents to strike a relatively easy 50/30/20 balance.
Tennessee
- Median household income: $67,097
- Annual cost of living: $40,737
Tennessee’s cost of living takes up far more than half of the average resident’s household income — specifically, about 62% — leaving them with a relatively tight margin to accommodate savings and paying down debt.
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South Carolina
- Median household income: $66,818
- Annual cost of living: $40,793
Average South Carolinians will find themselves in the same position as many residents of Tennessee. The ratio between median household income and cost of living is nearly the same between the two states, with living costs taking up just over 61% of your take-home in the Palmetto State.
Oklahoma
- Median household income: $63,603
- Annual cost of living: $34,580
Striking a financial balance in Oklahoma is fairly easy. At just $34,580, the cost of living in the Sooner State takes up only 54% of the state’s median household earnings.
Kentucky
- Median household income: $62,417
- Annual cost of living: $35,705
With a yearly cost of living of $35,705 versus a median household income of $62,417, The Bluegrass State runs a little pricey, with annual costs taking up 57% of the average resident’s take-home pay. That’s not enough to keep Kentuckians from making ends meet, though it can make abiding by the 50/30/20 rule a little tight.
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New Mexico
- Median household income: $62,125
- Annual cost of living: $40,814
New Mexico is where things start getting a bit more expensive in this gallery, with the median household income dwindling and the annual cost of living increasing. In the case of the Land of Enchantment, the ratio between the two isn’t all that enchanting, with the cost of living taking up 65% of the median household earnings.
Alabama
- Median household income: $62,027
- Annual cost of living: $35,246
Like Kentucky, Alabama has a cost of living versus median household income ratio of 57%. Again, that’s not an impossible financial feat, but it does leave the average Alabama resident without much fun money to spend on pure wants.
Louisiana
- Median household income: $60,023
- Annual cost of living: $33,741
Louisiana living comes with a lot of perks: warm weather, incredible culture and music and even better food. That said, it’s also a state where the cost of living takes a bite out of more than half of the median household income. Specifically, cost of living consumes roughly 56% of the median money made by locals.
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Arkansas
- Median household income: $58,773
- Annual cost of living: $33,751
Arkansas is yet another Southern state in which the cost of living chews through roughly 57% of the median household income, once again leaving locals able to abide by a variation of the 50/20/30 rule, but only just.
West Virginia
- Median household income: $57,917
- Annual cost of living: $32,358
West Virginia’s cost of living is comparatively low at $32,358 when held up against the rest of the nation; however, that amount is still more than half (56%) of the median household income for the state, which is only $57,917.
Mississippi
- Median household income: $54,915
- Annual cost of living: $32,761
It’s unfortunate that the state with the lowest median household income in America does not also have the nation’s lowest annual cost of living — indeed, the costs ($32,761 yearly) consume roughly 60% of the state’s median household earnings.
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This article originally appeared on GOBankingRates.com: 14 States Where the Median Income Is Under $70K — Is That Enough?
