How far can you stretch your dollar? Depends on where you're located in the U.S. The Tax Foundation has taken data from the Bureau of Economic Analysis to show the real value of $100 in each state. (We've also covered the D.C.-based think tank’s previously analyses, but the numbers changed ever-so-slightly year to year.)
The graphic below compares how much $100 is worth in goods compared to the national average. For instance, in high-price areas like California, New York, and D.C., your $100 is worth significantly less than the U.S. average—in those places, your money has the purchasing power of around $88.18, $86.70, and $85.47, respectively. If you live in Mississippi, meanwhile, your dollars go farther than in any other state. Your $100 is the equivalent of $116.01.
The data isn't surprising. People move from high-priced regions to cheaper areas of the country all the time. And it’s not just a matter of real estate. In Los Angeles, the average price of a beer is $3.64, but in New York, it’s $5.36, according to GoEuro’s annual Beer Index.
Cities, naturally, tend to be more expensive than rural places, so where you live within a state also has a pretty big impact. It’s much more expensive to live in Manhattan than to live in Syracuse, New York, or to live in Chicago versus downstate Illinois, as the Tax Foundation’s previous work has shown. This difference, however, is generally counter-balanced by the fact that expensive areas typically have higher salaries, too. Minimum wage laws, tax rates, and other factors also play a role.
It’s not just a theoretical exercise. A slight variation in the real value of your dollars can have a significant impact in your standard of living. The Tax Foundation explains:
Regional price differences are strikingly large; real purchasing power is 36 percent greater in Mississippi than it is in the District of Columbia. In other words, by this measure, if you have $50,000 in after-tax income in Mississippi, you would need after-tax earnings of $68,000 in the District of Columbia just to afford the same overall standard of living.