Cost of Living is at an all time high and moving is expensive, so if you need to choose where to live, it can often be helpful to look at a combination of factors that will hopefully help you weigh the pros and cons of the different states. Salaries, housing prices and the ability to get resources for everyday living are important factors to consider when deciding where to move and settle down long term.
The priciest locations in the continental US tend to be along the coasts, especially in the West and Northeast, and the more economical locations are usually located in the Midwest and South (with notable exceptions like the cities of Austin, Denver, Boulder or Miami amongst others). Of course, outside of continental US we can find exorbitantly expensive places like Hawaii, Alaska or even the territory of Puerto Rico, where the capital San Juan ranks amongst one of the most expensive cities. These locations can be pricier because of tourism and remoteness, which forces most of the goods to be imported via plane or freight boats and thus upping the price.
So, which states are the most expensive ones and merit a second look at our finances before making the move?
10. Maine. With an average Cost of Living Index of 116.9, the costliest item newcomers will have to consider is heating. The New England winters are cold and wet and most of the state runs its heating on fuel oil, the costliest heating option in the country and with extremely volatile prices. Having said that, new state laws have been passed that will tie the stat’s minimum wage to the Cost of Living Index and it will be adjusted annually accordingly.
9. New Jersey. With an average Cost of Living Index of 118.6 rent will be the biggest expense for newcomers as many New Yorkers cross the Hudson River in search for bigger and cheaper accommodations. While the rest of the state is not as expensive as Jersey City, housing will still be a major expense no matter where you are.
8. Oregon. With an average Cost of Living Index of 120.6 housing and gas prices will be the determining factors for this state. High salaries with few housing options have driven the market to increase its prices and lack of local refineries mean higher import prices for gas. As an interesting tidbit, the state also forbids self-serve gas pumping, driving up the prices even more.
7. Maryland. With an average Cost of Living Index of 125.1 insurance is the surprise most will encounter. The state mandates high minimum liability insurance, personal injury protection, and uninsured motorist coverage for every driver. This brings the minimum Maryland insurance premium to $2,120 compared to the national average for full coverage price of $2,000. A significant increase, especially when considering that the same full coverage will run drivers more than $5,000 per year.
6. Alaska. With an average Cost of Living Index of 126.7 is one of the least populated areas for a reason. The remoteness of most of the towns makes them hard to access and shipping of everyday items like groceries is prohibitive.
5. New York. With an average Cost of Living Index of 136.8 taxes will be your biggest unforeseen expense. Rent may be high, especially in Manhattan where space is at a premium, but the 12,75% tax burden for residents of the state is a major downside when moving there.
4. California. With an average Cost of Living Index of 139.8, there is no telling if housing, gas, utilities or food will be the most surprising to newcomers, but all of them contribute to make Cost of Living almost unsustainable. The tech bubble explosion affected the whole state and the demand to an already saturated hosing market contributed heavily to the hike in prices.
3. Massachusetts. With an average Cost of Living Index of 147.9 a combination of housing (the cost of median homes rose 8% from 2010 to 2021), gas prices and grocery bills (an average of $117 per week) can make this state unaffordable for many.
2. Washington DC. With an average Cost of Living Index of 154.5, taxes are higher than in any other state. The limited housing market also drives up prices in rent and property ownership forcing many newcomers into shared housing just to be able to afford a place to live.
1. Hawaii. With an average Cost of Living Index of 189.9, the paradise location can put most of the blame on isolation for it high prices. Housing is scarce due to tourism and developers building resorts and goods and services need to be imported from the continental US driving up the price. Electricity will also be a problem for residents, as most of it is generated by petroleum and thus will cost significantly more.