Friday, August 12, 2016

Hey, Nebraskans! You're Richer Than You Think

Recently, we received an e-mail alerting us to a new study that should make all of us Nebraskans feel a little better -- at least financially. 

A think tank in Washington, DC, called the Tax Foundation recently released a map showing the real value of $100 in each state. The Foundation considered purchasing power using data from the Consumer Price Index, which serves as a measure of inflation.  

As reported by The New York Times, North Dakota emerged as the state where per-capita incomes have the most purchasing power, but Nebraska wasn't far behind.  

North Dakota's "real per-capita personal income" is roughly $56,000.  Nebraska came in at No. 6 out of 51, with a real per-capita personal income of $48,000.  

The states where incomes fell shortest were Utah, New Mexico, Arizona, Idaho and Hawaii, all of them home to real per-capita personal incomes of $36,000.  

In its blog, the Tax Foundation noted, "Adjusting incomes for price level can substantially change our perceptions of which states are truly poor or rich.  For example, Nebraskans and Californians earn approximately the same amount in dollars per capita, but after adjusting for regional price parity, Nebraskan incomes can buy more."  

What's more is the Foundation analyzed purchasing power within the states, themselves.  It concluded that "cities are almost uniformly more expensive than rural areas due to the higher price of land."

Here in Saline County and other parts of rural Nebraska, your $100 bill is essentially worth $116.30, according to the Foundation.  While in Denver, that $100 is only worth $95.  In Miami or Chicago, it's only worth $94.  And in New York City, it's only worth about $80.  

While these may not seem like huge differences, they are when you consider the effect on $50,000 or $100,000.

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