Why is almost everybody so grumpy about the cost of living?

A recently updated dataset confirms these inflation anxieties, as rising costs gobble up more of whatever income growth you managed to earn.

My trusty spreadsheet reviewed something economists call “real median household income” for the 50 states and the District of Columbia. Simply put, that’s how the Census Bureau each year estimates consumer buying power: what a household makes – including paychecks, investments and pensions – after the pain of the national inflation rate gets subtracted.

Before we get going, let’s acknowledge last year’s income norms.

California’s typical household income ranked No. 12 among the states in 2025 at $100,800, 15% above the nation’s $87,460.

The highest income was in Massachusetts at $118,500. Lowest? Mississippi at $57,840.

But what’s key isn’t the income level – it’s how much it has changed.

First, let’s set checkbook expectations by using a period before we knew what coronavirus was: 1999 through 2019. Those two decades saw a series of economic booms, busts and in-betweens.

Typical incomes in only three states lost ground to inflation during this period: Michigan, where real incomes dropped by an average of $190 per year. Mississippi households lost $160 and Georgia $60.

Typical California households did OK, with after-inflation incomes growing by an average $900 per year – 17th best among the states.