The easiest states to save money in 2025

When it comes to saving money, where you live matters, according to a new study.

If you’re contemplating a move, Bankrate ranked all 50 U.S. states based on how easy — or difficult — it is for residents to grow their savings.

The study examined several factors within each state, including the cost of living, state and local tax rates, employment growth and interest rates on certain deposit accounts to determine which states offer the best environment for building savings.

"What is clear from these findings is that taxes and cost of living together create a heavy burden on savers, and the available savings rates in high-cost states does not make up for it," Stephen Kates, a financial analyst at Bankrate, said in a statement. "A state like Hawaii offers both the highest cost of living and the lowest average interest rates. Other high-cost states do not fare much better."

Tennessee ranked easiest state to save money

By the numbers:

Tennessee ranked as the easiest state to save money in the U.S., thanks primarily to a low local tax burden and a significantly low cost of living.

The Volunteer State ranked third in the tax category, with a combined state and local tax burden of 7.6%. Only Alaska and Wyoming offer lower tax rates than Tennessee.

In terms of the local economy, Tennessee ranked 10th among all states, tying with Indiana, signaling a low cost of living in the state. 

Tennessee was followed by Missouri, Texas, Oklahoma and Florida, with the five easiest states sharing three characteristics: lower-than-average tax burdens, affordable living costs and stable employment growth.

In terms of taxes, the southern states in the top five featured a state and local tax burden of 7.6% to 9.3%, all of which were below the national median of 10.2%, according to Bankrate’s study.

Moreover, each of the top five states ranked in the top 20 for employment growth over the past five years in the study. Employment growth suggests the local economy offers residents more job opportunities, providing more avenues to earn money. 

What they're saying:

"A lower cost of living and taxes mean residents can put more of their earnings into savings accounts rather than daily expenses. And a stable or growing job market means it may be easier for workers to secure employment and earn higher wages," Bankrate said in its study.

Easiest states to save money

1. Tennessee
2. Missouri
3. Texas
4. Oklahoma
5. Florida
6. Kentucky
7. South Dakota
8. Louisiana
9. Indiana
10. Michigan

See the full report here.

The hardest states to save money

Meanwhile, the five hardest states to save money featured two Western states and three Northeastern states: Hawaii, Connecticut, Vermont, California and New Jersey.

These five states hade a cost of living significantly higher than the national average, with Hawaii topping the list as the hardest state to save money. 

This shows that the residents of these states may be spending more on housing, health care, transportation and other day-to-day expenses than others, and may have less money left to contribute to a savings fund.

The five states also featured a combined state and local tax rate of between 13.2% and 15.4%, all higher than the national median. This added cost could cut into consumers’ take-home pay and budgets, leaving less opportunity to save money.

Most affordable metros to raise kids

Dig deeper:

The findings back up other recent studies which have analyzed the most affordable places to do things like raise a family or get gas.

A study, published last year, found that the most affordable metros to raise children were Lakeland, Florida; El Paso, Texas; Jackson, Mississippi; McAllen, Texas; and Wichita, Kansas.

RELATED: The most and least affordable metros to raise kids, and one state parents should avoid: Report

Meanwhile, another study found that the cheapest states for gas were Mississippi, Colorado, Louisiana, Oklahoma and Arkansas. 

MoneyU.S.NewsLifestyleU.S.Personal FinanceNews