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Hawaii residents more likely to be living paycheck-to-paycheck, analysis shows


    Downtown Honolulu as seen from the Kamehameha Schools Campus.

People living in Hawaii, California and New York are the most likely to live paycheck-to-paycheck, even though the states have among the highest income levels.

A new analysis by personal finance site finds that even though Hawaii has the third-highest median household income in the U.S. at $71,223, the costs of food, housing, transportation and utilities per paycheck, are highest in the nation.

What remains after living expenses is $186, or less than 7 percent of each paycheck. Hawaii is the only state with a single-digit percentage of disposable income.

Conversely, the state in which residents are least likely to live paycheck-to-paycheck is Minnesota.

The median household income there is $67,244, the sixth highest in the U.S.

With housing costs taking up 21 percent of a paycheck and utilities taking up 7 percent and health costs using only 3 percent, Minnesota was the only state in the study where the amount remaining after expenses were subtracted topped $1,000.

“Living paycheck to paycheck isn’t necessarily a function of income,” said Cameron Huddleston, GOBankingRates spokesman. “Plenty of upper-income households live hand-to-mouth because of poor financial habits,” he said. A separate GOBankingRates survey “found that people earning $100,000 or more were more likely to fear always living paycheck to paycheck than those earning less,” Huddleston said.

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      • Just to clarify, you need to peel back and understand that being a millionare is not simply having $1,000,000 in cash laying around…if this is so…that is not being prudent when you can be some safe returns that will minimize the impact of inflation. Let me not digress…to keep is simple…take your assets subtract your liabilities and if the resultant number is a million then you’re a millionare! There are a lot more around than you may realize (real estate). The worst situation is to be asset rich and cash poor…got to leverage and manage your assets / investments so you can enjoy yourself. It’s challenging but it is also be enjoyable (?)…just like working on improving your golf game.

        • Agree with you. Many of us in Hawaii who own homes all paid for are real estate rich, maybe millionaires. As you say, the trick is to use your ready cash and invest smartly. Money can be made in the stock market, even in the worst of times such as now. Not by relying on dividends but by shorting and options and buying when every else is panicking. It doesn’t pay to be too cautious and live on dividends and conservative bonds.

  • Plenty of people in the U.S. live like this. It’s because of poor money management. Contrast this to Japan where everything is even more expensive but their personal savings rate has always been high.

  • I finally figured out what mikethenovice is doing, making a huge number of one-sentence comments on so many articles. He hopes the weekly recap of comments that gets printed in the newspaper will include one of his comments. To get included it must be a very brief sound-byte that carries a punch. A zinger. Keep trying Mine. Nothing better to do, huh?

    • At least, much of the terrible burden of the economy out here has been caused or made much worse by a failed monopoly party. Yet you voters keep it in power hoping for scraps to be handed out and dependency to continue. Sad. I see little but brokenness and sadness out here.

    • Bdpapa, nothing personal, but the “new” part arrives when each person leaves the workforce for good. I have coworkers who drag thru the day, complaining about their small paycheck and tiny pay raises. Many can hardly wait to retire, but have they socked away enough to support themselves for the rest of their remaining lives? If not, their standard of living deescalates commensurately. There will be less taxes to pay as a senior citizens. Will there be enough to support oneselves? Will our grown children help us, or will they still need our assistance? If not, some of us will be living from one Social Security check to the next(which is smaller than the paycheck).

  • “People living in Hawaii, California and New York are the most likely to live paycheck-to-paycheck, even though the states have among the highest income levels.”

    And the highest per capita total tax burdens. Duh!

  • More likely? Oh ya think? Only now an analysis figured that out?

    Exactly why I’m retiring on the mainland even though I was born & raised here. As a local I can’t help but say that living here sucks. After traveling the world I’ve determined that my beloved homeland is overrun and overrated.

    • There are quite a bit of Hawaii ex-pats who have ended up on the mainland…AZ, LV, WA, OR and doing quite well. Good example, my nephew moved from Kauai (situation was getting to stifling) with his wife and kids. Sold their home ended up picking up a 40 acre property with a bed and breakfast resort on a lake it was a pricey piece of property but the business plan looks solid. Found out that the County wants to enter into a agreement to access spring water from his property (he has the mineral rights)…good deal and has first rights of refusal on another 60 acres should it become available. So there are opportunities out there and you have to decide it this is what you want to do…don’t think that just because you live in Hawaii it is your home…it’s where you end up making your home. Good Luck to all!

      • Good for your kids. I really mean that. I keep telling the younger local folks that it is important that they EXPLORE the world, while they are able. Hawaii is but a speck and for youngsters, find out how others live. You only live once but live life to it’s fullest.

        • You are so right…the population of Hawaii is 1.5 million a small population compared to the likes of LA, NY, etc. So when opportunities make themselves available to reap the benefits of something unique to what we have (i.e.TMT and the related research, education and # spend to support same…it’s a no brainer) and yet we have a small group laying waste to what can help us succeed. Let’s promote the uniqueness that can benefit our State and not to be a novelty item.

  • I totally agree that Hawaii is extremely expensive to live and raise a family, even if one is working full time and earning $34.24/hour, or $71,219 annually. The author fails to mention outside childcare(babysitting, preschool and after-school care). This would be 17% per kid, at $1,000 monthly. Renting a 3-bdrm house averages a whopping 43% of income. The $186 discretionary income from 13 paychecks amount to $403 monthly. I wonder if they included included tithing and saving 10% of their paycheck? I’m relieved my adult children are independent.

  • In my opinion, this is an indicator of what is happening throughout the country…jobs report may give a false sense of security when most are living “paycheck to paycheck”. Hence, I did not embrace the President’s recent State of the Union address.

  • One has only to look at median price of a home on Oahu! Over $700K? How much do you pay on the home? A tidy bit that leaves less spendable money. If your family eat out a lot, more problems. You’ve got to have another job on the side and even a 3rd just to stay afloat. Have lived on my Federal pension and have traveled on our investment income at one time to $20K now down to plus or minus $11K.

    • It is tough trying to buy a home however, the suggestion I made to my son is to invest in a small investment and hope that he will able to leverage paying off the mortgage with rental income. There will still be a negative but that lost may somewhat help offset his earned income in addition there are other deductions that may be claimed at the end of day there is still a negative but since you pay less taxes you end up “paying your investment” vs. paying the government. As years go by you parlay that investment and “step up”…it is doable but you have to exercise good judgment on what you invest in and be patient. Good example of what actually happened in the 80’s…invested $10,000 in piece of property and took out a loan of $70,000 to build home…rented out for a slight negative for several years and then sold for $250,000 and picked up condo in town for $350,000 (borrowed $100,000)…then paid off that mortgage with other investment gains ending up with “0” mortgage…property now worth somewhere around $450,000. Overall gain was somewhere around $300,000+ which is O.K. and the Return On Investment (ROI) is about 3.5% after all taxes + expenses. Hence, not too bad. Sorry for the long story…but hopefully it may help someone take a step down towards investging…it’s challenging but fun at the same time! Good Luck!

  • Well a lot of people start off the year in debt. After spending big bucks on fireworks there is a little bit more of a hole in their pockets. Therefore the need to catch up is part of daily life throughout the year. If you want to live in Hawaii you need to live within your means. If you cannot afford it then maybe move to a State where the cost of living is lower. Why suffer.

  • Why in the world is the post office here still paying a cost of living allowance. They already have a good pay. Time to eliminate the COLA pay so that the company can balance its ledger.

  • Why did’nt Ward research ask the TRUE survey question; ‘Do you agree that Oahu should continue with the rail project given it is one of the major reasons many residents live paycheck to paycheck?

    • I believe they would need to drill down to the increased on the General Excise tax that was increased to fund the rail project. In addition you need to drill down to other consumable fees…car registration (has anyone kept track on the escalation of this fee over the past several years?), Real Estate Tax, etc. This is government tax and spend and fund. On funding, interesting when this comes up around those who are employed or retirees of civil service…especially when the issue of retiree benefits (medical)come up. Nothing wrong with a retirement program however, in my opinion, it would be worthwhile to see a move away (via a payout) from a guarantee defined pension to a self managed retirement program (401K / IRA Rollover).

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