How to compare the cost of living if you're relocating
Moving? We break down how to conduct a cost of living comparison.
You just landed a new job with more pay and better benefits. Congratulations! But there's a catch — you have to move to a new state, perhaps one with a higher cost of living. The average cost of living between two cities can be drastically different. Before you hit the road, be sure to calculate moving costs along with the cost of living in your new region so you can avoid any unpleasant financial surprises. Whether you're still considering the offer, mid-move or already out the door, keep expenses in check with a financial review of both cities.
Cost of living comparison
When it comes to expenses, where you live can make a big difference. The cost of living can vary, sometimes drastically, by stateHawaii, California and Maryland have some of the highest costs of living in the country. On the flipside, Mississippi, West Virginia and Ohio have relatively low costs of living.
Health care expenditures differ
Health care costs are increasing at an astounding rate, but these rates vary by part of the country as well. Between 2018 and 2019, all states saw an increase in health care expenditures — some more than others.
The regions that saw the lowest increase in health care costs between 2018 and 2019 were the Great Lakes Region (Illinois, Indiana, Michigan, Ohio and Wisconsin) and the New England Region (Connecticut, Maine, New Hampshire, Rhode Island and Vermont).
Conversely, the regions that experienced the highest increase in health care costs between 2018 and 2019 were the Far West Region (Alaska, California, Hawaii, Nevada, Oregon and Washington) and the Southwest Region (Arizona, New Mexico, Oklahoma and Texas).
Housing costs vary… a lot
Whether you rent or buy, the amount you pay each month to keep shelter over your head will be a big part of your budget. Be aware that the cost of monthly rent, as well as what it costs to heat and cool your home, varies according to your location. Median monthly rent by state in 2019 was highest in California and lowest in West Virginia. Adding to these costs, the average utility cost per month is highest in Hawaii and lowest in New Mexico.
Transportation costs differ, too
Keep taxes in mind
Your tax burden in your new location may be very different from what you are used to now. Be sure to consider what your entire tax burden will be, including income, property, sales and excise taxes. The state with the highest proportion of income paid as taxes is New York, and the state with the lowest proportion is Alaska.