Your Money, Your Future
Your Money, Your Future

Move here to pay off your student loans faster

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Come to Alaska for the views. Stay for the student loan savings.

A recent analysis from Student Loan Hero showed that borrowers could pay down their debts even faster by relocating to a state with no income taxes.

The average state income tax is $1,977, according to Student Loan Hero, a personal finance website that focuses on educational debt.

That's based on applying an average state income tax rate of 4.05 percent to the average national salary of $49,630. The average college graduate left school with $37,172 in student loan debt, according to Student Loan Hero.

If you were to live in a state that doesn't tax income, you could use those savings to make bigger repayments on your loans.

There are seven states without an income tax: Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming.

Tennessee and New Hampshire also don't tax wage income, but they do place levies on investment income and dividends.

Don't pack up and leave town just yet — you'll need a place to land first.

"The biggest factor to consider would be employment," said Elyssa Kirkham, a researcher for the Student Loan Hero study. "You can move to a state with a lower tax rate, but if you're trading down for lower income, be aware of that."

Check out the five states below for known attractive salaries without the sting of income taxes.


Anchorage, Alaska
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Oil production drives revenue in Alaska. The average salary in The Last Frontier state is the highest among income tax-free jurisdictions: $56,710, according to Student Loan Hero's analysis of Bureau of Labor Statistics data.

Washington State

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Washington state comes in second as far as earnings for workers, where primary industries range from agriculture to computer software development and aircraft. The average salary is $55,810.

New Hampshire

Portsmouth, New Hampshire.
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The manufacture of high-end equipment drives the economy in New Hampshire, where the average salary weighs in at $50,180.


Austin, Texas
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If you're weighing a job in oil, natural gas, agriculture or defense, you may want to consider Texas. The average salary in The Lone Star state is $47,770


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In Wyoming, agriculture is king, but the state is also home to coal and natural gas industries. The average salary there is $46,840.