Cost of Living, by State and Spending Category

Housing in California costs about three times more than in Mississippi. Utilities in Hawaii cost nearly twice the national average. Clearly, the cost of living varies across the United States, depending on what you’re buying. See the differences in the chart below.

Paying More or Less

The above is based on regional price parity in 2023, estimated by the Bureau of Economic Analysis. They calculate price levels for each state and compare against the national average.

For Goods and Other, there is relatively little variation. All states fall within 8% of national price levels.

However, Housing and Utilities show a wide range across states.

The cost of housing in Arkansas, West Virginia, and Mississippi are close to half the price of the national average, whereas California (especially), New Jersey, and Colorado show much higher housing prices. Washington, D.C. is at the top for housing costs, which should be expected for a city.

Hawaii and Massachusetts residents appear to have relatively high utility bills. Idaho, Utah, and Montana residents have the lowest.

Texas and Delaware (and maybe Alaska) seem to be the only states that hang out around the national average across all four spending categories.

Now just take this information and combine it with income levels, and we might be onto something.