Cost of Living by State

Understanding the cost of living in a given state is crucial if you are in charge of a company with a local presence there. This is because the cost of living will impact a sizeable portion of your profits, and if you want to limit the adverse effect, you’ll need to learn how much it costs to live in that particular state.

What is the cost of living?  

The cost of living varies dramatically by state. If you are considering moving to another state, you need to make sure that you have enough money to support yourself and your family in that area. You should also consider a cost of living calculator to help you compare costs in different locations.

There are several companies and organizations that calculate the costs of living in different locations. These calculations include transportation, utilities, food, and health care.

A cost of living calculator can give you an idea of your monthly budget in a particular city. It can also identify areas of high housing and transportation costs. As a rule of thumb, you should spend 25-30 percent of your net income on these expenses.

The cost of living index is a helpful tool that compares living prices in various cities across the country. This is usually done by comparing the average living costs for a given area with a national standard.

The Consumer Price Index (CPI) is a government-produced cost of living. Businesses often use this to determine the level of wages a worker can expect to earn. Also, it is sometimes used to determine the level of Social Security benefits a worker can expect.

States with the Lowest Cost of Living Index

The states with the lowest cost of living index are a good choice for families who want to save. However, living in these areas often means lower wages.

While each state’s cost of living is different, the bottom line is that there is no reason to sacrifice your quality of life to make ends meet. A lower cost of living can mean more money for other needs and wants.

The top three states with the lowest cost of a living index are Alabama, Mississippi, and Oklahoma. In addition to being affordable, each has a lot to offer. For example, Alabama has an outstanding education system and a history in the civil rights movement.

Likewise, with its professional services, healthcare, and advanced manufacturing opportunities, Missouri is a great place to live. Although its score isn’t as high as its neighboring states, it’s still well above the national average.

With its vibrant urban lifestyle in cities like Wichita and Kansas City, Kansas is also a good choice. It’s home to three Air Force bases and a thriving economy that thrives off oil and tourism.

With its low housing and transportation costs, Arkansas is another top state for a low cost of living. The state’s major employers include Wal-Mart and Tyson Foods.

States with the Highest Cost of Living Index

There are several reasons that the cost of living can be high in certain states. These reasons can range from the weather to the cost of health care. While some people may be able to find local wages that are adequate for their quality of life, others are forced to move to more affordable areas.

Housing is a significant driver of the cost of living. In Boston, for example, the average two-bedroom apartment rents for more than double the state average.

The price of groceries is also higher than it has been in years. Gas prices are also on the rise.

Health insurance is also a significant cost factor. The cost of living in the United States is $68,808 per year for a family of four.

New Jersey is the fourth most expensive state to live in. Its housing costs are the second highest in the country.

Georgia has a lower cost of living than most states. Its coastal beaches, clean air, and southern charm make it a popular living place.

Alaska is the sixth most expensive state. Although the state has fewer than one million acres of farmland, it must import most of its food.

Defining the Cost of Living Index

The cost of living is essential in determining your social security benefits. The Social Security Administration adjusts benefit payments to keep up with rising living costs.

A cost of living index measures the average cost of living in different areas of the U.S. and is used by policymakers when creating policies. It is also an essential part of wage negotiations.

The Council for Community and Economic Research (CCER) is a research organization that has been collecting and compiling cost of living data since 1968. Their index measures housing, transportation, and healthcare. They calculate the prices of a representative sample of goods and services to create the index.

A cost of living index can help compare prices between cities and states. If you’re considering moving to a new location, the information can help you determine whether or not you can afford to live there.

Many cost of living indexes uses a base number of 100. However, there are other ways to determine the cost of living in a particular region. There is another cost of living measurement, including the Consumer Price Index, which the U.S. Bureau of Labor Statistics publishes.

Why the cost of living matters to your business

If you’re planning to relocate, consider the cost of living in your new state before making a final decision. Several factors, including housing, transportation, food, and utilities, can determine the cost of living. Using a cost-of-living calculator can help you evaluate the cost of living in your current city and decide whether or not it would be feasible for you to move.

A cost of living calculator can also help you compare living costs in different cities. The calculator can help you determine what you’ll need to spend on living in your new town and how much you’ll save.

Some organizations track the cost of living in different areas. One of the most popular cost-of-living calculators is the MoneyGeek calculator, which uses data from the U.S. Bureau of Labor Statistics, the Council for Community and Economic Research, and the annual American Community Survey.

The calculator can compare expenses in up to 500 U.S. cities, including New York, Houston, San Francisco, and Seattle. Some information includes the cost of groceries, childcare, health care, entertainment, and housing.

Cost of living calculator 

If you’re considering moving, consider using a cost of living calculator to help determine your new budget. It’s an excellent way to determine whether a new city is affordable and can help you decide where to relocate.

Living expenses include various essential items such as housing, food, transportation, and utilities. These expenses vary from location to location. The cost of living index can tell you which areas are more expensive.

Food is the largest expense category, but it’s not the only one. Other expenses include transportation, medical care, and utilities. When it comes to entertainment, costs can vary drastically by location.

Housing costs can be exceptionally high. The price of a home can be a significant factor in deciding where to live. You’ll also need to remember that property and income taxes can be considerable.

For example, if you are planning to move to a new state, you’ll need to think about how much money you’ll need for the mortgage and how much you’ll spend on other essentials such as clothing. There are several online tools to help you do this.

What is a cost of living adjustment COLA?

A cost of living adjustment is an annual increase in income or salary, often applied to benefits and wages. It is designed to help people maintain their purchasing power in the face of rising prices.

Cost-of-living adjustments are commonly seen in public pensions but may also be applied to wages or employment contracts. The federal government uses the Consumer Price Index to calculate them.

A COLA is usually applied to federal employees, who are more likely to receive them. Some companies and unions also use CPI to calculate their COLAs.

When the cost of living increases, people with fixed monthly incomes may have trouble making ends meet and have to work extra jobs to afford the necessities of their lifestyle.

Companies may give their employees a COLA as part of their employment contract or raise on merit. However, some private pensions do not offer COLAs.

In addition to determining the overall cost of living in a given region, the CPI can indicate whether or not there is deflation. Deflation occurs when the cost of goods and services increases slower than the inflation rate. If the prices of goods and services rise faster than the inflation rate, the value of savings, pensions, and other assets decreases.

That’s why we have such drastic rates across different states among cost of living adjustments. For example, the pay rates are often different for the same job in the same company as the same salary doesn’t fulfill the same living qualities. You can see this in jobs listed in marketplaces and the additional payments made to federal employees. 

While the base salary of every employee in the same pay grade is identical, the locality adjustments aren’t. The difference between the lowest and the highest locality pay adjustment is about 30 percent. This alone can help you see the drastic difference between every state in the cost of living. 

Here is the cost of living index for every state including DC and Hawaii according to the Missouri Economic Research and Information Center.

Rank (highest to lowest)
1	Hawaii	193.4
2	DC	156.5
3	New York	145.9
4	California	138.9
5	Massachusetts	132.5
6	Oregon	131.9
7	Alaska	126.3
8	Maryland	125.5
9	Connecticut	122.3
10	Rhode Island	119.2
11	Vermont	116.8
12	Maine	116.5
13	New Jersey	115.5
14	Washington	112.7
15	New Hampshire	109.5
16	Nevada	108.1
17	Delaware	108.0
18	Colorado	105.4
19	Pennsylvania	103.0
20	Arizona	102.4
21	Virginia	101.3
22	Minnesota	101.2
23	Florida	101.0
24	Montana	100.3
25	South Dakota	99.0
26	Utah	98.6
27	North Dakota	97.6
28	Wisconsin	97.0
29	North Carolina	96.5
30	South Carolina	96.4
31	Wyoming	95.5
32	Illinois	95.4
33	Idaho	94.8
34	Kentucky	93.9
35	Nebraska	93.9
36	Louisiana	93.4
37	West Virginia	92.9
38	Texas	92.6
39	Ohio	92.0
40	Michigan	91.4
41	Iowa	91.1
42	Indiana	91.0
43	New Mexico	90.8
44	Missouri	90.1
45	Tennessee	89.6
46	Georgia	89.4
47	Arkansas	89.1
48	Alabama	88.8
49	Oklahoma	88.6
50	Kansas	87.1
51	Mississippi	83.3