Cost of living by state in 2026: the quick answer and how to use this guide
Cost-of-living by state measures how far your paycheck could go in one state compared with the national average, based on the combined price of housing, groceries, utilities, transportation, and health care. If you’re planning a move within the US, this comparison may mean more than a city’s reputation for being “expensive” or “cheap.”
At a glance
Most affordable states overall: Oklahoma, Alabama, Iowa, West Virginia, and Kansas Least affordable states overall: Hawaii, Massachusetts, California, Washington, D.C., and New York Biggest single driver of state-to-state differences: housing costs Last updated: September 2026
The rankings below use one standardized cost-of-living index, rather than mixing examples from different sources, so every state can be compared on the same scale. It’s worth noting that a state’s average can hide big differences between its cities and rural areas, so we’ve included a guide on how to check a specific destination.
What “cost of living” includes (and what most rankings miss)
Most cost-of-living comparisons combine six categories: housing, transportation, groceries, utilities, healthcare, and state and local taxes. Housing is often the single biggest factor. A similar apartment can cost two or three times as much in one state as in another, while a gallon of milk or a tank of gas usually varies less from state to state.
Healthcare is trickier to compare because some rankings mix insurance premiums, out-of-pocket spending, and total per-capita health spending. These aren’t the same because a state can have high total health spending and still be affordable for someone with solid employer coverage. State and local taxes add another layer: income tax, sales tax, and property tax rates all shift your real cost of living in ways a simple price index won’t show.
Housing vs. everything else
Housing (rent or mortgage payments) typically makes up the largest share of a household budget, so it also does the most to move a state’s overall ranking. A state can look moderately priced on paper while still having a handful of high-cost metro areas. And the reverse is also true: a lower-cost state can have one or two cities where housing costs soar. That’s why it’s worth checking a specific city or county, not just the state average, once you’ve narrowed your list.
If you’re moving to the US for work or to be closer to family, it also helps to plan for costs that don’t show up in a standard cost-of-living index. This could include a security deposit and first and last month’s rent, setting up utilities, a state driver’s license or car registration, and building a US credit history before you can qualify for the best rates on a lease, loan, or credit card.
Common mistake: Comparing salaries without considering taxes or housing type. A higher salary in a high-tax, high-rent state can leave you with less to spend than a lower salary somewhere with no state income tax and cheaper rent. Comparing take-home pay and realistic housing costs side by side gives a clearer picture than comparing gross salary alone.
2026 cost of living by state: a complete 50-state ranking
The table below uses the Missouri Economic Research and Information Center’s (MERIC) Cost of Living Data Series, a single standardized index built from six categories — housing, utilities, groceries, transportation, health care, and miscellaneous goods and services — with the national average set at 100. A state at 90 runs about 10% below the national average; a state at 140 runs about 40% above it. For a cross-check, the US Bureau of Economic Analysis’s 2024 Regional Price Parities — a separate government-published index — place many of the same states at the extremes: Hawaii, California, and New Jersey among the priciest, and Arkansas, Mississippi, and Oklahoma among the least expensive, which corroborates the pattern below.
How to read this table: rank 1 is the most affordable state overall; rank 51 (Hawaii) is the most expensive. The “vs. national average” column shows roughly how far above or below the US average each state runs. This is a state-level average — individual cities inside any state can run well above or below their state’s number, so use it as a starting shortlist, not a final answer. See the states with the lowest cost of living for a closer look at the most affordable end of this table.
| Rank | State | Cost-of-living index (US = 100) | vs. national average |
| 1 | Oklahoma | 83.0 | 17% below average |
| 2 | Alabama | 86.0 | 14% below average |
| 3 | Iowa | 86.1 | 14% below average |
| 4 | West Virginia | 87.0 | 13% below average |
| 5 | Kansas | 87.1 | 13% below average |
| 6 | Mississippi | 87.4 | 13% below average |
| 7 | Missouri | 88.2 | 12% below average |
| 8 | Arkansas | 89.0 | 11% below average |
| 9 | Indiana | 89.7 | 10% below average |
| 10 | Tennessee | 89.7 | 10% below average |
| 11 | Georgia | 90.1 | 10% below average |
| 12 | Nebraska | 90.1 | 10% below average |
| 13 | New Mexico | 90.2 | 10% below average |
| 14 | North Dakota | 90.5 | 10% below average |
| 15 | Texas | 90.8 | 9% below average |
| 16 | Louisiana | 91.3 | 9% below average |
| 17 | Michigan | 92.1 | 8% below average |
| 18 | South Carolina | 92.7 | 7% below average |
| 19 | Ohio | 93.0 | 7% below average |
| 20 | Minnesota | 93.4 | 7% below average |
| 21 | South Dakota | 93.5 | 7% below average |
| 22 | Kentucky | 94.0 | 6% below average |
| 23 | Wyoming | 94.4 | 6% below average |
| 24 | Illinois | 94.5 | 6% below average |
| 25 | Pennsylvania | 95.3 | 5% below average |
| 26 | Wisconsin | 95.7 | 4% below average |
| 27 | North Carolina | 96.7 | 3% below average |
| 28 | Utah | 98.4 | 2% below average |
| 29 | Virginia | 99.0 | About average |
| 30 | Idaho | 99.4 | About average |
| 31 | Delaware | 100.6 | 1% above average |
| 32 | Florida | 100.8 | 1% above average |
| 33 | Colorado | 102.7 | 3% above average |
| 34 | Connecticut | 103.6 | 4% above average |
| 35 | Nevada | 105.4 | 5% above average |
| 36 | Montana | 106.0 | 6% above average |
| 37 | New Hampshire | 108.5 | 9% above average |
| 38 | Arizona | 108.6 | 9% above average |
| 39 | Oregon | 110.4 | 10% above average |
| 40 | Rhode Island | 110.9 | 11% above average |
| 41 | Maine | 112.9 | 13% above average |
| 42 | Vermont | 113.4 | 13% above average |
| 43 | Washington | 115.1 | 15% above average |
| 44 | Maryland | 118.8 | 19% above average |
| 45 | New Jersey | 119.2 | 19% above average |
| 46 | Alaska | 124.5 | 25% above average |
| 47 | New York | 132.6 | 33% above average |
| 48 | District of Columbia | 133.8 | 34% above average |
| 49 | California | 140.3 | 40% above average |
| 50 | Massachusetts | 148.1 | 48% above average |
| 51 | Hawaii | 185.8 | 86% above average |
Source: Missouri Economic Research and Information Center (MERIC), Cost of Living Data Series, Q1 2026 index (accessed and verified September 2026). Figures are a state-level average and can shift somewhat as new quarterly data is published.
Five most affordable states: Oklahoma (83.0), Alabama (86.0), Iowa (86.1), West Virginia (87), and Kansas (87.1), all with housing costs well below the national average. Five most expensive: Hawaii (185.8), Massachusetts (148.1), California (140.3), Washington, D.C. (133.8), and New York (132.6).
Please note that this index is a useful starting point, not the last word. It doesn’t capture a specific neighborhood, a specific salary, or state and local tax rates, and it can shift from year to year as housing and insurance prices move. You may want to treat this as part of a multi-step comparison, covered next.
How to compare two states for your situation (a step-by-step mover’s method)
- Start with the index. Use the table above to shortlist two or three states in a similar affordability range and note how far each sits from the national average.
- Price your housing path. Decide whether you’re renting or buying, then look up typical rent or home prices for the specific city or county you’re considering, not just the state average. It’s worth checking how much of your income should go to rent before committing to a number.
- Check state and local taxes. Look up the state’s income tax (some states, like Texas and Florida, don’t have one), sales tax, and property tax rates, since these affect your real take-home pay differently than a flat salary comparison would.
- Factor in transportation. If you plan on driving, compare insurance, gas, and commute distances. If you prefer somewhere with strong public transit, compare fare costs and commute times.
- Look at healthcare access and cost. If a job offer includes health insurance, compare that plan’s premiums and deductibles rather than the state’s overall health-spending average.
- Build a first-90-days budget. Add a one-time cushion for a security deposit, moving costs, and setting up utilities and a bank account, on top of your regular monthly budget. A budgeting app may be suitable to help you track one-time costs separately from ongoing ones.
Example (for illustrative purposes only, local averages not verified): Two renters earn the same salary. One is considering a lower-cost state (index around 88), and the other a higher-cost state (around 115). The table below shows how the same salary might be allocated differently. You may want to use this as a template and drop in real numbers for your target cities.
| Monthly category (illustrative) | State A (index ~88) | State B (index ~115) |
| Rent (1-bedroom) | $1,050 | $1,650 |
| Utilities | $180 | $220 |
| Groceries | $400 | $430 |
| Transportation | $220 | $180 |
| Health insurance (employee share) | $150 | $150 |
| Monthly total | $2,000 | $2,630 |
Note: These figures are illustrative placeholders for the method, not real state or city averages. You can replace them with verified local numbers for the cities you’re actually comparing.
Checklist: data to gather before you decide
- Typical rent or mortgage payments for the specific city, not just the state
- State income tax and any local tax rates
- Estimated monthly utility and health insurance costs
- Typical commute cost (gas and insurance, or a transit pass)
- Any licensing, registration, or relocation costs specific to your situation
What’s driving costs in 2026: housing, insurance, and utilities
Housing
- Inflation: As part of its Consumer Price Index, the US Bureau of Labor Statistics tracks shelter costs, which is one of the more persistent categories in recent inflation data.
- Primary cost driver: The Bureau of Economic Analysis’s Regional Price Parities point to housing as the single biggest reason state costs differ from the national average, more than groceries, transportation, or utilities combined.
- Metro vs. rural split: High-demand metro areas can push a state’s average upward, even if large portions of the state remain relatively affordable.
- Insurance
- Shifting averages: Homeowners and renters insurance premiums have moved unevenly across regions, according to the National Association of Insurance Commissioners (NAIC) state-by-state premium data.
- Address-specific quotes: Because insurance costs are shifting rapidly, statewide averages are less reliable than direct, address-level quotes when estimating your total monthly budget.
- Need current data: If you’re comparing states, it’s worth getting a current quote rather than relying on an older average, since this category can shift.
- Utilities
- Regional rates: The US Energy Information Administration (EIA) publishes state-level electricity price data, and prices vary noticeably by region and by season.
- Seasonal swings: Depending where you’re looking, the cost-of-living index may not fully reflect monthly heating or cooling bills.
- Fuel sources: States relying heavily on imported fuels or old grid infrastructure may experience different price stability than other states.
The “city effect”: none of this replaces a city-specific check. Two cities in the same state can differ from each other as much as two different states do. Comparing Houston and Miami is one example of how much a specific-city comparison can add beyond a state average, especially between a state’s largest metro area and its smaller towns.
Questions to ask before you move
- What’s the average commute time and cost from the neighborhoods you can afford?
- Does the job offer include a cost-of-living or relocation adjustment?
- How does the state tax your specific type of income (wages vs. self-employment, for example)?
- What would typical renters or homeowners insurance quotes look like for that specific address?
- What’s a realistic monthly grocery budget for your household size in that area?
FAQs about cost of living by state
Which state has the lowest cost of living?
Based on the MERIC Cost of Living Data Series, Oklahoma currently has the lowest overall cost-of-living index in the country, running about 17% below the national average, largely from comparatively low housing costs. Alabama, Iowa, West Virginia, and Kansas round out the five most affordable states.
Which state is the most expensive to live in?
Hawaii has the highest cost-of-living index in the country, running well above the national average, driven mainly by housing costs and added expenses from shipping goods to the islands. California, Massachusetts, Washington, D.C., and New York are the next most expensive.
Is a state average an accurate way to compare cities?
Not entirely. A state’s cost-of-living index is a useful starting point, but individual cities can run well above or below their state’s average. Before committing to a move, it’s worth checking rent and typical costs for the specific city or neighborhood as well.
How should renters compare cost of living between states?
Renters may want to compare a specific city’s typical rent for their target unit size, rather than the state’s overall index, since housing usually drives most of the difference between states. Pairing that with take-home pay after state income tax gives a clearer picture than either figure alone.
How much does state income tax affect the cost of living?
Meaningfully. States without a personal income tax, like Texas and Florida, can offset somewhat higher prices elsewhere, while a high-tax state can reduce take-home pay even if its overall cost-of-living index looks moderate. Comparing net pay, not just salary, gives a more accurate picture.
What costs do people forget to budget for when moving to a new state?
Commonly overlooked costs include a rental security deposit, setting up utilities, a state driver’s license or vehicle registration, and the time it can take to build a US credit history for the best loan and lease terms. Calculating a first-90-days cushion helps absorb these one-time costs.
What’s the best dataset to use for comparing cost of living by state?
The MERIC Cost of Living Data Series and the US Bureau of Economic Analysis’s Regional Price Parities are two widely used, publicly available options. Both set the national average at 100, making it straightforward to see roughly how far above or below average a given state runs.
Key takeaways
- Compare states using one consistent, publicly published index (like the MERIC Cost of Living Data Series) rather than mixing sources that use different methodologies.
- Housing is the single biggest reason costs differ between states, so it deserves the closest look once you’ve narrowed your list.
- A full comparison also weighs taxes, insurance, transportation, and health care access — not price alone.
- Your own monthly budget, built around a specific city and your actual income after tax, matters more than any statewide average.
Choosing a state: use rankings as a shortlist, then validate locally
Choosing where to live starts with a shortlist, not one number. You may want to use a standardized cost-of-living index to narrow options, then check real rent or home prices, state and local taxes, and insurance costs for the specific city you’re considering, before building a monthly budget around your actual income. Whatever you decide, it’s worth verifying current numbers for your target city before signing a lease or accepting an offer.
Wherever your move takes you, Remitly can help you send money and stay connected with family back home as you settle into a new state and get your budget on track.
Comparing cost-of-living by state means starting with one standardized index, then layering in housing, taxes, and insurance for a specific city before building a personal budget. State averages can set the starting point, but city-level costs make the final difference.
Last reviewed: September 2026
