New data has revealed that the most expensive state for a family of four is California or New York.
In Massachusetts, a family of four needs to earn a salary of at least $150,578 to cover their basic needs, according to a new study from smart assetwhich is largely due to rising housing and child care costs in the state.
Hawaii is the second most expensive state for families, followed by Connecticut in third place.
New York ranks fourth, while California is the fifth most expensive state for a family to make ends meet, it found.
The analysis lays bare how persistent inflation and rising costs are eroding the purchasing power of families across the country.
In Massachusetts, a family of four needs to earn a salary of at least $150,578 to cover basic needs, according to SmartAsset
The study examined cost estimates for housing, food, health care, transportation and child care in all 50 states.
The cost of these basic items can vary significantly depending on local labor and real estate markets, city infrastructure and legislation, and even social and cultural influences.
SmartAsset found that while maintaining a larger household generally increases overall costs, thanks to economies of scale, the cost per child decreases when there is more than one child in a family.
The study found that Massachusetts is the most expensive state for two working parents and two children to make ends meet.
Housing in Massachusetts is notoriously unaffordable, amid a severe property shortage across the state, particularly in Boston.
Three-quarters of new home buyers and 83 percent of new renters in the state said they faced challenges when looking for a place to live, according to a University of Massachusetts survey earlier this month.
Another key reason the state is at the top of the rankings is the rising cost of child care.
According to SmartAsset, child care will cost parents an average of $21,500 per child per year.
If one parent stays home to care for children, families can potentially save a significant amount on childcare and other expenses, but this means they will also lose valuable income.
The study estimates that a parent who stays home to care for a child typically saves about $11,000 per child per year.
Covering the basic needs of a family of four in Hawaii requires an average family salary of $147,319, making it the second most expensive state on the list.
Housing is the main factor driving up the cost of living in the state, as strong demand, housing shortages, and land use and zoning regulations have driven up prices.
A University of Hawaii report from March found that the median price of a new two-bedroom condo in Hawaii is $672,000, which is more than double the U.S. average of $300,000.
In third place in the SmartAsset ranking is Connecticut, where a family of four needs a salary of $139,924 to survive.
In addition to housing costs, which are among the highest in the United States, Connecticut residents also face higher than average state and local taxes.
According WalletHubThe total tax burden (the proportion of total income that residents pay in state and local taxes) in Connecticut is just over 10 percent for 2024. This includes property taxes, income taxes, and sales taxes.
High taxes are also a key driver of the cost of basic needs in New York, where a family of four with two working parents needs a salary of $139,504 to survive, according to SmartAsset.
While the cost of housing, food, and transportation is notoriously high in New York City, residents across the state also face a significant tax burden compared to other parts of the country.
New York has the highest tax burden, 12.02 percent in 2024, according to WalletHub.
Strong demand, a housing shortage, and land use and zoning regulations have driven up property prices in Hawaii.
The cost of housing, food, and transportation is notoriously high in New York City, and residents across the state also face a significant tax burden compared to other parts of the country.
Meanwhile, California ranked as the fifth most expensive state in terms of basic costs for a family of four.
To survive in the Golden State, parents must collectively earn a salary of at least $138,357, the study found.
Once again, much attention has been paid to skyrocketing home prices in major cities like Los Angeles, San Francisco and San Diego.
Child care in the state is also among the most expensive in the country. The average annual cost of sending a young child to daycare in California is $13,408, according to a report from the Annie E. Casey Foundation charity.
While New York and California are among the most expensive states in the US to live as a family, they are both large states with significant populations outside of affluent cities, pushing them slightly down the ranking.
On the other end of the spectrum, Mississippi has the lowest income threshold needed to cover basic needs: $88,895, SmartAsset found.
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