A state’s cost of living can be the difference between living comfortably or struggling to keep your head above water. The cost of living is all of your expenses, including homes, groceries, utilities and insurance. In essence, it’s what it costs to live. Gauging an area’s cost of living is a crucial factor when figuring out where to live.

Cost of living by state

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In a recent Insure.com survey of 502 people, we asked respondents what’s most important when moving to a new area. Cost of living is the number one issue by far:

  • How much more or less I could afford there -- 44%
  • Low crime -- 20%
  • Cost of insurance, including auto and home -- 13%
  • State taxes -- 9%
  • A welcoming community -- 7%
  • Things to do in the area -- 5%
  • A vibrant area -- 1%

Given those results, it’s not surprising that the biggest motivation in moving to a new area or state comes down to dollars. When asked for their biggest motivation to move to a higher cost of living area, respondents went with a higher salary:

  • A higher salary -- 32%
  • To be near loved ones -- 13%
  • A great job opportunity -- 13%
  • A better work/life balance -- 11%
  • To retire in a place I enjoy -- 10%
  • Better schools -- 3%
  • To live in a small town/rural area -- 3%
  • To live in a big city -- 2%

Eleven percent said they wouldn’t move to a higher-cost area regardless.

The cost of living is especially important when switching jobs. A prospective job may be willing to increase your salary by $10,000, but will that extra money go far in a new area? Or is it better to stay put with lower pay in an area with a lower cost of living? You may know that housing and groceries play a role in cost of living, but you might not know that insurance also has a part.

Insurance companies base auto and home premiums on risk. They may charge you higher rates based on an area’s claims history, economics and social factors. Weather can also influence home rates. Homes in regions that are more prone to extreme weather will pay higher rates than areas with calmer weather.

What is the average cost of living by state?

We’ve compiled the data from multiple sources to figure out the cost of living for each area. You can search by your Zip code and compare it to other areas through our Cost of Living Comparison Tool.

The states and area with the highest cost of living are Hawaii, the District of Columbia, New York and California. On the other side, Mississippi,  Arkansas, New Mexico, Oklahoma and Tennessee have the lowest cost of living.

We analyzed eight factors when gauging the cost of living:

  • Miscellaneous goods and services
  • Housing costs
  • Groceries
  • Transportation
  • Utilities
  • Health care
  • Auto insurance
  • Home insurance

We weighed them in order of importance and impact on an area’s cost of living. Goods and services and housing topped the list. Combined, they contributed more than half of the final result for an area’s cost of living.

Here are the average cost of living for each state. A 100 “avg CoLI” is the average cost of living for the entire country. That means a state like Mississippi with a 84.78 average CoLI is under the average the national average. On the flip side, Hawaii is 195.8, which means it’s nearly double the national average. In the below chart, "compared to the national average" represents how much higher and lower a state is compared to the national average.

StateAvg CoLICompared to national average
New Mexico88.86-11.14%
North Carolina93.53-6.47%
South Carolina94.12-5.88%
North Dakota97.91-2.09%
South Dakota98.38-1.62%
West Virginia100.680.68%
Grand Total106.026.02%
New Hampshire111.2511.25%
New Jersey114.0314.03%
Rhode Island119.3919.39%
New York152.5652.56%
District of Columbia157.757.7%

Cost of living in Hawaii

Hawaii is the most expensive place to live in the U.S. The state's cost of living is nearly double the national average. 

One of the biggest factors in an area’s cost of living is housing costs. Hawaii has the highest average housing costs by far. The average Hawaii property goes for more than three times more than the national average. It’s not only housing that costs more in the state. The Aloha State also has much higher utilities and grocery costs.

One silver lining is insurance costs. Hawaii has lower than average insurance rates, especially home insurance, which has the lowest average rates. Why? Hawaii is known for its perfect weather. Beautiful weather usually means fewer weather-related home insurance claims.

So, insurers consider houses in Hawaii low risk compared to places like Louisiana and Florida, which often get hit by major hurricanes, or Oklahoma, which gets hit by tornadoes. The average homeowner in Florida and Oklahoma pays more than double for home insurance than the average American.

Cost of living in California

Only Hawaii, the District of Columbia and New York have a higher cost of living than California. That doesn’t mean all parts of California are pricey. Your dollar will likely go much further in places like Redding and Bakersfield than it will in San Francisco and Los Angeles.

Home insurance costs are lower for California than the average. Other than that, Californians pay more for auto insurance, groceries, housing, utilities, transportation, health care and miscellaneous goods.

Cost of living in Florida

Overall, Florida has the 31th cheapest cost of living, so it's in the middle of the road. Florida is around average for many cost factors. There is an exception, though. You’ll pay much more for insurance if you live in Florida.

Florida has some of the highest home insurance rates. You’ll likely pay more for coverage in The Sunshine State than elsewhere. Floridians pay more for home insurance because of the area’s weather and claims history.

Hurricanes often strike the state -- whether along the east coast, west coast or the panhandle. You’ll want to keep that in mind if you decide to move to Florida. The state is a popular destination for people in northern states during their retirement years. Depending on the area in Florida where you lay down roots will depend on how much you can stretch your dollars.

Cost of living in Texas

Texas is the 19th least expensive state in terms of the cost of living. Overall, the cost of living is less than the average area.

You’ll pay less to live in Texas than other areas, including housing, auto insurance and transportation. However, you’ll fork over more money for home insurance and slightly more for utilities.

Texas is prone to hurricanes, which means higher home insurance rates. Remember -- Texas is a vast state. Home insurance and other costs vary. If you live in El Paso, you’ll likely pay lower home insurance rates than if you lived in Houston or Galveston, which can feel the brunt of hurricanes. So, don’t just take the state averages as a reason to move to Texas. Make sure you gauge the specific area to see its cost of living.

Cost of living in New York

Overall, New York has the third-highest cost of living. Parts of Manhattan are often the most expensive places to live in the U.S.

Much like with Texas and California, you’ll want to dig deeper into the costs for specific areas when deciding on a move to New York. Yes, a condo in New York City or a home in Westchester County will cost you top dollar. However, areas in upstate New York are much more affordable.

Overall, the average New Yorker pays more than double for housing than the average American. Auto insurance also costs more. You may save in one area though -- home insurance. Parts of New York like Syracuse and Buffalo get walloped with snow, but overall the state doesn’t get many freak storms that lead to major damage. Hence, lower home insurance rates than other states.

Cost of living within states

A state like California or Hawaii has much higher rates than areas like Utah and Idaho. However, the cost of living varies by region within a state, too. Rural areas usually have lower cost of living than suburban and urban areas. Even metro areas within the same state vary.

One example is Texas. Cities like Houston, Dallas, El Paso, San Antonio, Austin, Amarillo and Beaumont are all proudly Texan, but the cost to live in each varies. The more congested Northeast isn’t immune to substantial cost of living shifts either. New York has the New York City area, Long Island and Westchester County, which all have high costs. However, The Empire State also includes more affordable areas like Albany, Rochester, Utica and Buffalo.

So, don’t write off an entire state if it has an overall high cost of living. Instead, dig deeper into the numbers to gauge specific regional costs.

Frequently asked questions

What state is the cheapest state to live in?

Mississippi is the cheapest state in terms of cost of living. Mississippi costs are lower than the state average in every category except for home insurance costs. Home insurers base rates on risk. Weather-related claims, such as hurricanes, fires and break-ins lead to higher costs.

Which state is the most expensive to live in?

Hawaii is the most expensive state for cost of living. Hawaii has about average auto rates and well below average home insurance costs. Besides that, Hawaii is much more costly than the average state, especially housing costs.

How is the cost of living index calculated by state?

We used eight factors when gauging the cost of living. We gave miscellaneous goods and services (30%) the biggest influence, followed by housing (29%). Other factors included groceries (13%), transportation (9%), utilities (9%), health care (4%), auto insurance (2%) and home insurance (2%). We then rank the states by those results.

Check out how your area’s cost of living compares to others

Insure.com offers a way to compare multiple area’s cost of living. The Cost of Living Calculator lets you measure two areas side-by-side. You can see the costs associated with:

  • Housing
  • Groceries
  • Utilities
  • Transportation
  • Health care
  • Goods and services
  • Auto insurance
  • Home insurance


The tool tells you which area’s cost of living is higher. It also provides a salary you’ll need to maintain your current standard of living.

Knowing what you’ll need to earn to maintain your lifestyle gives you critical information to see if it’s worth it to move to that area.

The calculator can also help if you’re looking to retire. Maybe you’re looking at multiple areas in Florida, South Carolina, Arizona or even Hawaii. The tool enables you to see what you may need to earn if you move to specific areas.

Check out Insure.com’s Cost of Living Calculator.