The cost of living is defined as the amount of money needed to sustain a certain standard of living by affording basic needs such as housing, food, healthcare, and more. The cost of living is often used to compare how expensive it is to live in one location compared to another and is also used as a big factor for people to determine where they want to be located in addition to cultural attractions, the job market, and other factors. If you’re planning on relocating, you’ll want to considerd the overall best states to live in too.
The cost of living in the United States varies significantly between states. A large determining factor for the cost of living index is housing. For reference, the median rent for a two-bedroom apartment in the United States is $1,192 per month.
The cost of living index provides you with the percentage difference in the cost of living between one location and another. The percentage difference is always compared to 100; therefore, if the cost of living index is 90, it is 10% below the location it is being compared to. In this case, when comparing the cost of living index of states, 100 represents the U.S. average.
Figures in this article are from November 2020. Included is the average rent for a two-bedroom dwelling and the livable wage in each state.
States with the Lowest Cost of Living
Mississippi has the lowest cost of living in the U.S., with a cost of living index of 84.8. Most notably, Mississippi’s housing index is 66.7, the lowest in the country. The average home cost in Mississippi is $128,000, and the average rent for a two-bedroom apartment is $746. The living wage in Mississippi is only $46,000.
Oklahoma has the second-lowest-cost of living index of 86.8. Oklahoma also has significantly lower housing costs, with the average rent for a two-bedroom apartment costing about $879 per month. The living wage in Oklahoma is about $47,000.
Arkansas has the third-lowest cost of living index in the country, with an index of 87.8. Housing, transportation, and healthcare are particularly lower in Arkansas than in other parts of the country. The living wage in Arkansas is only $45,000.
With a cost of living index of 87.9, Kansas has the fourth-lowest cost of living. Kansas’s housing cost index is particularly low at 71.8. The average rent for a two-bedroom in Kansas is about $752 per month. The livable wage is around $48,000 per year.
Missouri has the fifth-lowest cost of living index of 88.9. Missouri’s housing index is 71.6, the second-lowest in the country, with average rent for a two-bedroom apartment at $827 and the average home value at about $159,000. The living wage in Missouri is $46,000.
States with the Highest Cost of Living
The state with the highest cost of living index is Hawaii, whose index is 196.3. This means that the cost of living in Hawaii is 96.3% higher than the U.S. average. Hawaii’s housing index is 336.3, where a two-bedroom costs about $1,895 per month, and the median home value is about $660,000. Groceries are also significantly more expensive in Hawaii since it is an island and most goods need to be shipped in. Hawaii’s livable wage is $61,000.
The District of Columbia has the second-highest cost of living index of 161.1. The District of Columbia’s housing index is 279.2, with an average rent price of a two-bedroom apartment going for $2,776 per month. The living wage in D.C. is $67,000, the highest in the country….[ ]