The Most Expensive States to Live In (2025)

Based on comprehensive cost of living data across housing, groceries, transportation, healthcare, and utilities, here are the top 10 most expensive states:

Top 10 Most Expensive States

1. Hawaii - COL Index: 184 (84% above national average)
2. California - COL Index: 137 (37% above average)
3. Massachusetts - COL Index: 129 (29% above average)
4. New York - COL Index: 123 (23% above average)
5. Alaska - COL Index: 122 (22% above average)
6. Maryland - COL Index: 116 (16% above average)
7. Oregon - COL Index: 112 (12% above average)
8. Washington - COL Index: 111 (11% above average)
9. New Jersey - COL Index: 110 (10% above average)
10. Connecticut - COL Index: 108 (8% above average)

What this means: In Hawaii, $100 buys you what $54 would buy in an average-cost state. In California, $100 buys you $73 worth of goods/services.

The Cheapest States to Live In (2025)

On the flip side, these states offer the lowest cost of living:

Top 10 Cheapest States

1. Mississippi - COL Index: 84 (16% below national average)
2. Arkansas - COL Index: 86 (14% below average)
3. Oklahoma - COL Index: 86 (14% below average)
4. Kansas - COL Index: 87 (13% below average)
5. Alabama - COL Index: 88 (12% below average)
6. West Virginia - COL Index: 89 (11% below average)
7. Iowa - COL Index: 89 (11% below average)
8. Indiana - COL Index: 90 (10% below average)
9. Missouri - COL Index: 90 (10% below average)
10. Kentucky - COL Index: 91 (9% below average)

What this means: In Mississippi, $100 buys you what $119 would cost nationally. Your money goes 19% further.

See how far your salary goes in each state →

Complete State Rankings (All 50 States)

Full Cost of Living Index (100 = National Average)

Very Expensive (120+):

• Hawaii: 184
• California: 137
• Massachusetts: 129
• New York: 123
• Alaska: 122

Expensive (110-119):

• Maryland: 116
• Oregon: 112
• Washington: 111
• New Jersey: 110
• Connecticut: 108

Above Average (100-109):

• Rhode Island: 107
• Vermont: 106
• New Hampshire: 105
• Maine: 103
• Colorado: 101

Average (95-100):

• Nevada: 99
• Virginia: 99
• Delaware: 99
• Pennsylvania: 99
• Illinois: 98
• Minnesota: 98
• Florida: 98
• South Dakota: 97
• Arizona: 96
• Utah: 96
• North Carolina: 96
• Georgia: 95

Below Average (90-94):

• Montana: 94
• Texas: 93
• Wisconsin: 93
• North Dakota: 92
• Louisiana: 92
• Nebraska: 92
• South Carolina: 91
• Kentucky: 91
• Missouri: 90
• Indiana: 90

Cheap (85-89):

• Iowa: 89
• West Virginia: 89
• Alabama: 88
• Kansas: 87
• Oklahoma: 86
• Arkansas: 86

Very Cheap (Below 85):

• Mississippi: 84

What Drives Cost of Living?

Cost of living isn't just one number - it's a composite of multiple factors:

1. Housing Costs (35-45% of COL)

The biggest factor. Housing varies 10x across states.

Most expensive housing markets:

• Hawaii: Median home $800K+
• California: Median home $700K+ (San Francisco $1.4M+)
• Massachusetts: Median home $600K+

Cheapest housing markets:

• Mississippi: Median home $140K
• Arkansas: Median home $155K
• West Virginia: Median home $145K

Rent comparison:

• San Francisco 1-bedroom: $3,000-4,000/month
• Jackson, MS 1-bedroom: $700-900/month

2. Groceries & Food (10-15% of COL)

Food costs vary significantly:

Most expensive:

• Hawaii: +60% above national average (shipping costs)
• Alaska: +40% above average (remote locations)
• California: +15% above average (high wages, regulations)

Cheapest:

• Missouri: -15% below average
• Tennessee: -12% below average
• Oklahoma: -10% below average

Example basket: Same $100 worth of groceries costs:

• Hawaii: $160
• California: $115
• Missouri: $85

3. Transportation (10-15% of COL)

Includes gas, car insurance, maintenance, public transit:

Most expensive:

• California: High gas prices ($4-5/gallon), expensive insurance
• Michigan: Highest car insurance rates in nation
• Nevada: Above-average insurance costs

Cheapest:

• Iowa: Low gas prices, cheap insurance
• Nebraska: Below-average across the board
• North Dakota: Affordable transportation overall

4. Healthcare (8-12% of COL)

Medical costs vary by state regulations and market competition:

Most expensive:

• Alaska: Limited providers, remote locations
• West Virginia: Aging population, fewer doctors
• South Dakota: Rural, limited competition

Cheapest:

• Massachusetts: Competition, good access
• Hawaii: Healthy population, good coverage
• Utah: Young, healthy population

5. Utilities (6-8% of COL)

Electricity, water, gas, internet:

Most expensive:

• Hawaii: $500+/month average (island electricity costs)
• Connecticut: $350+/month (expensive electricity)
• Alaska: $350+/month (heating costs)

Cheapest:

• Louisiana: $150-200/month
• Arkansas: $150-200/month
• Oklahoma: $150-200/month

The Real Picture: Salary vs Cost of Living

High cost doesn't always mean you're worse off. What matters is buying power = salary ÷ cost of living.

Example: Software Engineer ($120K salary)

Scenario 1: San Francisco, CA

• Salary: $150,000 (higher than national average)
• COL Index: 137
• Real buying power: $109,489

Scenario 2: Austin, TX

• Salary: $120,000 (average for role)
• COL Index: 93
• Real buying power: $129,032

Result: Austin gives you $19,543 more in real purchasing power despite lower salary.

Scenario 3: Des Moines, IA

• Salary: $90,000 (lower than average)
• COL Index: 89
• Real buying power: $101,124

Takeaway: Texas (medium COL, good salary) beats both high-COL California and low-COL Iowa for this specific role.

Calculate your real buying power →

Best States for Maximum Buying Power

Combining low cost of living + decent salaries, these states offer the best value:

Top 10 States for Real Buying Power

1. Texas - Low COL (93), strong job market, no income tax
2. Tennessee - Very low COL (90), growing cities (Nashville), no income tax
3. Florida - Average COL (98), no income tax, good job market
4. North Carolina - Below average COL (96), Research Triangle jobs
5. Arizona - Below average COL (96), growing Phoenix metro
6. Georgia - Below average COL (95), Atlanta job market
7. Colorado - Average COL (101), high salaries, outdoor lifestyle
8. Utah - Below average COL (96), booming tech scene (Silicon Slopes)
9. Indiana - Low COL (90), manufacturing and tech jobs
10. Nevada - Average COL (99), no income tax, Las Vegas/Reno growth

Why these states win:

• ✅ Lower cost of living than coastal states
• ✅ Strong job markets with competitive salaries
• ✅ Many have no state income tax
• ✅ Growing economies attracting employers

Worst States for Buying Power

High cost + lower salaries = financial pain:

States to Think Carefully About

1. Hawaii - Sky-high COL (184), salaries don't keep pace, limited job market
2. Alaska - High COL (122), limited industries, expensive everything
3. Vermont - High COL (106), rural, fewer high-paying jobs
4. Maine - Above average COL (103), lower salaries, aging economy
5. West Virginia - Paradox: cheap COL (89) but very low wages, declining economy

The trap: These states either have high costs without compensating salaries, or low costs but depressed job markets.

Cost of Living by Major Metro Area

State averages can be misleading. Cities within states vary dramatically:

California Example

State COL: 137

But by metro:

• San Francisco: COL 163 (63% above national average)
• Los Angeles: COL 142 (42% above average)
• San Diego: COL 137 (37% above average)
• Sacramento: COL 113 (13% above average)
• Fresno: COL 94 (6% BELOW average)

You can live affordably in California - just not in San Francisco or LA.

Texas Example

State COL: 93

But by metro:

• Austin: COL 105 (5% above average - growing expensive!)
• Dallas: COL 95 (5% below average)
• Houston: COL 92 (8% below average)
• San Antonio: COL 88 (12% below average)

Texas isn't uniformly cheap - Austin costs more than Florida average.

Compare 530+ metros →

How to Use This Information

If You're Considering Relocation

1. Look at total compensation, not just salary

   • A $120K job in Austin might beat $150K in San Francisco
   • Use buying power calculation: Salary ÷ (COL Index ÷ 100)

2. Consider your career stage

   • Early career: High-COL cities might offer better opportunities
   • Mid-career: Medium-COL cities maximize savings
   • Retirement: Low-COL states stretch fixed income

3. Factor in state income tax

   • No-tax states (Texas, Florida, Tennessee) boost take-home 5-10%
   • High-tax states (California, New York) reduce it further

4. Lifestyle preferences matter

   • Cheap state you hate > Expensive state you love? Probably not worth it
   • Factor in weather, culture, proximity to family

If You're Negotiating Salary

Use COL data as leverage:

"I'm moving from Austin (COL 105) to San Francisco (COL 163). My current $100K salary needs to be $155K to maintain the same buying power. Can you offer $150K?"

The math: $100K × (163 ÷ 105) = $155,238 equivalent

Employers understand this. Use it.

If You're Remote

You have maximum flexibility. The winning strategy:

1. Get a coastal-city salary (negotiate as if you live there)
2. Live in a low-COL state (Tennessee, Texas, Florida)
3. Keep the difference (can be $20-40K/year)

Example:

• Salary (SF rates): $150K
• Live in Tennessee: COL 90
• Real buying power: $166,667
• VS living in SF: Gain $57,178/year

But beware: Some companies have location-based pay. And some states (like NY, CA) try to tax remote workers. Consult a tax professional.

The Cost of Living Trends to Watch (2025)

Rising Costs

1. Austin, TX - Up 20% since 2020 (tech boom)
2. Boise, ID - Up 25% since 2020 (California refugees)
3. Nashville, TN - Up 18% since 2020 (no income tax + growth)
4. Phoenix, AZ - Up 15% since 2020 (warm weather, growth)

Why: These cities attracted remote workers during COVID. Demand > supply = rising costs.

Falling or Stable Costs

1. San Francisco, CA - Down 5% since 2020 (remote work exodus)
2. Seattle, WA - Stable (some remote work departure)
3. Chicago, IL - Down slightly (population loss)

Trend: Some expensive coastal cities seeing corrections as remote work enables relocations.

Your Action Plan

Step 1: Use our calculator to see your take-home pay in different states

Step 2: Calculate real buying power:

Real Buying Power = Salary ÷ (COL Index ÷ 100)

Step 3: Compare top options:

• Take-home pay (after taxes)
• Real buying power (after COL)
• Job market for your industry
• Lifestyle fit (weather, culture, family)
• Schools (if you have kids)

Step 4: Don't just chase low COL:

• Mississippi is cheap but has limited high-paying jobs
• California is expensive but has massive job market
• Sweet spot: Medium COL + strong job market (Texas, North Carolina, Arizona)

Conclusion

Cost of living varies 2x+ across US states. But cheap isn't always best, and expensive isn't always bad.

Key insights:

✅ Hawaii is most expensive (84% above average) ✅ Mississippi is cheapest (16% below average) ✅ Texas offers best combination of low COL + strong jobs + no state tax ✅ Real buying power matters more than COL or salary alone ✅ Within states, city differences can be huge (Fresno CA ≠ San Francisco CA)

What to do next:

1. Calculate your exact take-home pay in your current and target states
2. Factor in cost of living adjustments to see real buying power
3. Compare total financial picture (not just one number)
4. Make decisions based on YOUR priorities (career, family, lifestyle)

Remember: The best state for you isn't just the cheapest or highest-paying. It's the one that maximizes your financial AND personal goals.

Compare your options now - it's free →