Income inequality in the U.S. isn’t some new phenomenon, but it has been growing over the past several decades. The median yearly income in the U.S. is approximately $81,000, according to the latest data from the Federal Reserve. However, income inequality remains a burning issue, with some individuals earning significantly more while others continue to face financial hardship.
To provide a greater understanding of how Americans are faring across the country, online financial advisory site WalletHub analyzed all 50 states and the District of Columbia based on three key factors:
- The average annual income of the top 5%;
- The average income of the bottom 20%; and
- The median income for all residents.
“The highest-earning 10% of individuals in the United States earn over 12 times more than those in the lowest-earning 10%, based on the latest census data,” WalletHub analyst Chip Lupo said in a statement. “By measuring the income of various percentiles against a state’s median income, we can better identify where income disparities are more prevalent, which could help us better understand why residents of certain states struggle more to make ends meet.”
According to WalletHub’s analysis, Virginia is the state where people have the highest income, when balancing between the median, top 5%, and bottom 20% of earners. Rounding out the top 10 are New Jersey, New York, Connecticut, Washington state, Utah, Minnesota, Colorado, Illinois, and Massachusetts.
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- Related article: How the 50 States Rank By State and Local Tax Rates in 2025
The top 5% of earners in Virginia make an average of $533,522 per year, while the bottom 20% make an average of $19,293. While there is a big gap between these two numbers, the top 5% ranks as the third highest in the U.S., while the bottom 20% ranks fourth. In other words, both the rich and the poor are doing better than their counterparts in other states, WalletHub said.
The median annual income in Virginia is $93,275, which ranks as the 17th-highest in the country, so many residents seem to be skewed to either side of the wealth spectrum in that state.
The analysis also shows that West Virginia is the state where its residents have the lowest income. The top 5% of earners in West Virginia make an average of $357,430 per year, while the bottom 20% make an average of $12,940.
The full WalletHub analysis of income levels by state is as follows (all numbers are adjusted for the cost of living index):
| Overall Rank | State | Total Score | Average Annual Income of Top 5% (Adjusted for COLI) | Median Annual Income (Adjusted for COLI) | Average Annual Income of Bottom 20% (Adjusted for COLI) |
|---|---|---|---|---|---|
| 1 | Virginia | 67.73 | $533,522 | $93,275 | $19,293 |
| 2 | New Jersey | 67.37 | $522,128 | $122,447 | $17,083 |
| 3 | New York | 66.67 | $575,505 | $95,033 | $13,647 |
| 4 | Connecticut | 65.57 | $535,578 | $118,346 | $15,005 |
| 5 | Washington | 63.03 | $499,994 | $109,171 | $18,777 |
| 6 | Utah | 61.62 | $466,144 | $95,101 | $23,531 |
| 7 | Minnesota | 59.49 | $486,764 | $89,434 | $20,616 |
| 8 | Colorado | 59.18 | $483,844 | $102,825 | $19,253 |
| 9 | Illinois | 58.17 | $521,989 | $81,549 | $16,705 |
| 10 | Massachusetts | 56.97 | $486,112 | $133,946 | $14,221 |
| 11 | Texas | 54.21 | $504,383 | $73,718 | $17,461 |
| 12 | California | 54.13 | $473,848 | $129,884 | $14,542 |
| 13 | District of Columbia | 53.00 | $470,987 | $169,153 | $9,768 |
| 14 | Georgia | 52.63 | $504,969 | $69,815 | $16,968 |
| 15 | Maryland | 50.98 | $438,921 | $128,496 | $17,012 |
| 16 | Florida | 49.11 | $492,920 | $72,684 | $16,097 |
| 17 | New Hampshire | 47.45 | $417,276 | $116,255 | $18,973 |
| 18 | Pennsylvania | 44.46 | $464,388 | $77,581 | $16,288 |
| 19 | Missouri | 43.67 | $464,577 | $62,391 | $17,561 |
| 20 | North Carolina | 43.52 | $468,634 | $66,565 | $16,532 |
| 21 | Arizona | 43.40 | $450,383 | $78,746 | $17,190 |
| 22 | Michigan | 43.17 | $460,674 | $64,806 | $17,466 |
| 23 | Idaho | 43.09 | $432,492 | $74,521 | $19,578 |
| 24 | Tennessee | 42.85 | $471,725 | $61,902 | $16,337 |
| 25 | Nebraska | 42.67 | $443,531 | $75,610 | $17,942 |
| 26 | Delaware | 41.71 | $422,916 | $90,873 | $18,056 |
| 27 | Ohio | 40.56 | $455,092 | $64,455 | $16,713 |
| 28 | Kansas | 39.31 | $432,887 | $71,329 | $17,814 |
| 29 | Wisconsin | 38.57 | $418,059 | $75,780 | $18,615 |
| 30 | Iowa | 36.57 | $414,953 | $71,552 | $18,358 |
| 31 | South Dakota | 36.06 | $415,926 | $72,189 | $17,891 |
| 32 | Nevada | 34.61 | $419,998 | $84,612 | $15,203 |
| 33 | Indiana | 33.70 | $415,138 | $66,989 | $17,275 |
| 34 | North Dakota | 32.92 | $405,631 | $81,960 | $16,237 |
| 35 | Montana | 32.44 | $413,616 | $72,701 | $16,110 |
| 36 | South Carolina | 32.41 | $433,153 | $66,038 | $14,588 |
| 37 | Oregon | 31.88 | $396,956 | $95,357 | $15,145 |
| 38 | Hawaii | 31.50 | $352,749 | $146,646 | $14,199 |
| 39 | Wyoming | 30.77 | $396,773 | $78,702 | $16,453 |
| 40 | Oklahoma | 29.45 | $418,392 | $59,284 | $15,438 |
| 41 | Kentucky | 28.57 | $427,286 | $57,716 | $14,105 |
| 42 | Arkansas | 28.05 | $426,569 | $53,166 | $14,420 |
| 43 | Rhode Island | 26.82 | $373,461 | $110,458 | $13,352 |
| 44 | Alaska | 25.99 | $337,921 | $117,767 | $16,183 |
| 45 | Alabama | 24.91 | $412,305 | $57,774 | $13,818 |
| 46 | Vermont | 23.49 | $358,688 | $94,544 | $15,052 |
| 47 | Maine | 20.31 | $358,542 | $83,800 | $14,540 |
| 48 | Louisiana | 19.83 | $405,592 | $58,352 | $11,733 |
| 49 | Mississippi | 16.31 | $391,715 | $48,630 | $12,515 |
| 50 | New Mexico | 14.52 | $371,006 | $62,464 | $12,351 |
| 51 | West Virginia | 11.23 | $357,430 | $55,201 | $12,940 |
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Tags: income, income inequality, Payroll
