States Ranked by Cost of Living

Key Points (2026)

• The most expensive state is Hawaii with a cost of living index of 185.0, making it 85% more expensive than the national average, driven by housing costs three times the national baseline and groceries 50% above average due to the cost of shipping goods to the islands.
• The most affordable state is Oklahoma with a cost of living index of 86.0, roughly 14% below the national average, with housing costs among the lowest in the country and a median home price around $175,000 in many markets.
• The national average household spends approximately $61,334 per year on core expenses, with housing consuming 34.9% of that total at roughly $1,784 per month, transportation at 16%, and food at roughly $609 per month.
• Moving from the most expensive to the most affordable tier of states can save a typical household $1,500 to $2,500 per month in combined housing, food, and transportation costs, a financial shift large enough to fund significant retirement savings or debt payoff over time.
• Low cost does not always mean low quality: States like Tennessee, Georgia, North Carolina, and Indiana consistently rank as affordable while offering strong job markets, good infrastructure, outdoor access, and growing metropolitan areas that attract significant inbound migration year over year.

All 50 States Ranked by Cost of Living Index (2026)

The index below uses the U.S. national average as the baseline set at 100. A state with an index above 100 costs more than the national average to live in; a state below 100 costs less. The index reflects the combined cost of housing, food, transportation, healthcare, and utilities weighted to reflect typical household spending patterns.

States Ranked by Cost of Living Highest to Lowest USA

Source: World Population Review Cost of Living Index (Feb 2026).

The 10 Most Expensive States: What’s Driving Costs

The ten most expensive states share a common set of structural cost drivers: high housing demand relative to available supply, geographic constraints that limit development, high state income taxes that compound the expense of daily living, and in some cases the logistical reality of importing goods from the mainland. Understanding what makes each state expensive helps you evaluate whether the premium is something you’d actually benefit from or simply a cost you’d absorb without proportional return.

Hawaii (Index: 185.0)

Hawaii is the most expensive state in the country by a wide margin, with a cost of living 85% above the national average. Housing costs three times the national average, with a typical single-family home at $730,511 and two-bedroom apartment rentals averaging $2,399 per month. Groceries run 50% above average because nearly all goods must be shipped to the islands, adding transportation costs to every product on the shelf. The living wage for a family of four in Hawaii is $107,702 per year, and the median family income of $118,223 means the state functions more sustainably than many others on this list despite its extreme pricing.

California (Index: 142.3)

California’s cost premium is primarily driven by housing, which runs twice the national average at a median single-family home price of $683,996 statewide, with coastal metros like Los Angeles and San Francisco pushing significantly higher. Transportation costs are the second-highest in the country, fueled by some of the highest gas taxes and prices nationally. The state’s top income tax rate of 13.3% adds a layer of financial pressure that compounds meaningfully for middle and upper-middle income households. California holds the highest homelessness rate in the nation, a visible consequence of the widening gap between housing costs and median income.

Massachusetts (Index: 141.2)

Massachusetts combines high housing costs in the Greater Boston area with elevated healthcare costs driven by a dense concentration of world-class medical institutions that set regional pricing benchmarks. The Boston metro’s housing market has tightened significantly over the past decade as the technology and life sciences industries drew high earners who competed for limited housing inventory. Outside Greater Boston, much of western Massachusetts offers meaningfully lower costs, but the state average is pulled upward heavily by the eastern corridor.

New York (Index: 125.1)

New York’s statewide average is 25% above the national baseline, though the range within the state is dramatic. New York City’s two-bedroom apartments average $5,874 per month in the city proper, while upstate cities like Buffalo, Syracuse, and Rochester offer housing costs well below the national average. The state’s cost burden also includes city income tax of up to 3.876% for NYC residents on top of the state’s 10.9% top rate, a combination that makes high earners in the city carry one of the heaviest combined tax loads in the country.

Alaska (Index: 124.9)

Alaska’s high cost of living reflects pure geography rather than luxury or desirability premiums. Most goods must be shipped or flown into communities that are not connected to the continental road network, which adds transportation cost to virtually every consumer product. Food costs run substantially above the national average, and utilities are elevated due to heating demands in a climate with extreme winters. Alaska offsets some of this with no state income tax and the annual Permanent Fund Dividend that distributes oil revenue to residents.

Finding the right neighborhood is a top priority for any relocation. Compare your options in our guide to States Ranked by Safety 2025.

The 10 Most Affordable States: What Your Money Buys

The most affordable states share a pattern of housing markets where supply has kept pace with demand, lower population density that reduces competition for resources, and in most cases no state income tax or very low income tax rates that allow households to retain more of what they earn. The trade-offs vary by state and deserve honest evaluation alongside the cost advantages, since job market depth, healthcare infrastructure, climate, and quality of life metrics differ significantly within this affordable tier.

A successful relocation often depends on the local economy. See the latest data on States Ranked by Job Market Growth.

Oklahoma (Index: 86.0)

Oklahoma is the most affordable state in the country, sitting 14% below the national average with housing costs among the lowest anywhere. Oklahoma City and Tulsa both offer growing job markets across aerospace, bioscience, energy, and engineering, making this one of the more economically dynamic affordable states rather than simply a cheap place with limited opportunity. The state’s median home price lands around $175,000 in many markets, and two-bedroom apartments average around $742 per month, numbers that make homeownership accessible on incomes that would face significant affordability constraints in coastal states.

Mississippi (Index: 87.3)

Mississippi offers the lowest housing costs in the country with a median home price of $140,818 and average two-bedroom rents at $991 per month. The state provides full tax exemptions for all forms of retirement income including Social Security and IRA distributions, which makes it particularly attractive for retirees on fixed incomes. The honest counterpart to Mississippi’s affordability is its high poverty rate of nearly 20% and consistently lower scores on education and healthcare quality rankings, factors that matter differently depending on your income, age, and what you need from public infrastructure.

West Virginia (Index: 88.3)

West Virginia carries the second-lowest housing costs in the nation, with median home prices around $107,400 and average rents at $658 per month. Its mountain landscape provides genuine outdoor recreation value with access to skiing, hiking, whitewater rafting, and extensive state park systems. The state’s economic challenges are well documented, with industries that have contracted significantly over decades, though natural resources, aerospace, and energy sectors continue to provide employment in specific areas.

Alabama (Index: 88.6)

Alabama combines affordability with stronger economic fundamentals than some of its southeastern peers, hosting a growing aerospace and bioscience sector alongside traditional manufacturing and a median home price of $170,184. Healthcare and transportation costs rank among the lowest nationally, and the state’s southern geography provides warm climate and Gulf Coast beach access for residents in the southern half of the state. The poverty rate at 15.6% is above the national average, a structural challenge the state continues to address through industry diversification.

Kansas (Index: 88.8)

Kansas offers some of the country’s most accessible homeownership, with average single-family homes around $176,898 and two-bedroom rents averaging $995 per month. The state’s unemployment rate of 2.5% is among the lowest nationally, reflecting a labor market where housing affordability and job availability align in a way that coastal states rarely achieve. Kansas City’s position on the Missouri border gives western Kansas residents access to a genuine major metropolitan area with professional sports, arts, dining, and employment density that the rural Kansas landscape alone doesn’t provide.

The right environment makes all the difference when planning a family move. See the States Ranked for Children’s Well-being in 2025.

The Best Value States: Affordable and Growing

Some of the most compelling relocation destinations in 2026 sit in the middle tier of the cost index, at or just below the national average, with strong job markets, improving infrastructure, and lifestyle advantages that pure affordability rankings don’t fully capture. These states offer the balance that many households are actively searching for: housing that feels reasonable rather than crushing, employment density that reduces remote-work dependency, and cities with genuine cultural and recreational amenities.

If you’re planning a move on a fixed income, it helps to review the States That Tax Social Security in 2026.

Tennessee (Index: 90.3, No State Income Tax)

Tennessee delivers a combination few states can match at its price level: zero state income tax, a cost of living 10% below the national average, a Nashville metro that has developed genuine economic and cultural depth, and the Great Smoky Mountains National Park as a backyard. Median home prices statewide run $146,000, and even in the Nashville market where prices have appreciated significantly, two-bedroom rentals remain below $1,800 in many suburban areas. FedEx, Dollar General, Bridgestone, and a growing healthcare sector provide employment without full remote-work dependency.

Texas (Index: 92.1, No State Income Tax)

Texas lands 8% below the national average despite having some of the country’s most dynamic and economically diverse metropolitan areas. The no-income-tax advantage is real at any income level, and for households earning $150,000 or more, the difference from California or New York represents $8,000 to $20,000 per year in additional take-home pay. Property taxes in Texas run higher than many states at 1.6% to 2.5% of assessed value annually, so homeowners at higher price points should factor that into total cost comparisons, but the overall index still lands meaningfully below the national baseline.

North Carolina (Index: 97.8)

North Carolina sits just 2% below the national average while hosting the Research Triangle’s rapidly growing technology and life sciences sector, Charlotte’s established financial industry, and Asheville’s nationally recognized arts and outdoor recreation scene. The state’s flat income tax rate of 4.25% is among the most competitive on the East Coast for a state with this level of metropolitan development and infrastructure quality. For households relocating from northeastern states, the combination of familiar East Coast culture, lower housing costs, milder winters, and a lower tax burden represents a compelling overall package.

Georgia (Index: 92.5)

Georgia offers the rare combination of a truly major metropolitan area (Atlanta) with a statewide cost of living 8% below the national average. Atlanta’s job market encompasses the headquarters of Home Depot, UPS, Delta Air Lines, and a growing technology sector, and the city’s MARTA rail system provides transit connectivity that most Sun Belt cities lack. Non-taxable Social Security income and several retirement-friendly tax provisions make Georgia one of the most actively recruited states among retirees considering southeastern relocation.

What Actually Drives Cost of Living Differences Between States

Understanding the mechanics behind cost of living indexes helps you evaluate whether a state’s ranking is relevant to your specific situation, because the index is an average that can mask significant variation within categories that affect different households in very different ways.

• Housing is the dominant variable. Across all states, housing costs represent 34.9% of total household spending and drive more of the difference between expensive and affordable states than any other single category. A state with housing costs 50% above average will almost always land in the expensive tier regardless of what its food or transportation costs look like, which is why states with supply-constrained coastal housing markets consistently top expense rankings.Getting settled in your first home is easier when you pick the right location. View the Best States for First-time Homebuyers.
• State income tax creates a compounding effect. A household earning $120,000 in California pays $10,000 to $13,000 more in state income taxes annually than the same household in Texas, Tennessee, or Nevada. That difference represents roughly $850 to $1,100 per month in purchasing power, which stacks directly on top of housing cost differences to create the total financial gap between high-tax and no-tax states.
• Property taxes can offset income tax advantages. States with no income tax frequently compensate through higher property taxes. Texas homeowners pay 1.6% to 2.5% of assessed value annually, which on a $400,000 home represents $6,400 to $10,000 per year. Florida’s property taxes similarly run higher than states with income taxes, meaning the comparison between states requires looking at total tax burden rather than any single tax category in isolation.
• Transportation costs vary with infrastructure and fuel policy. California’s combination of high gas taxes, high insurance requirements, and the practical necessity of driving everywhere in most cities creates transportation costs that rank second-highest nationally. States with lower gas taxes, less mandatory insurance coverage, and more walkable or transit-served cities reduce this category significantly for residents who can take advantage of it.
• Food and grocery costs are more uniform than housing. While coastal states with high housing costs tend to have grocery prices 5% to 15% above average, the food cost differential between most continental states is relatively modest compared to the housing differential. Hawaii is the major exception, where shipping costs add 50% to grocery prices across the board. For most relocations, food costs alone shouldn’t significantly influence the destination decision.
• Healthcare costs reflect market density and insurance competition. States with high concentrations of major hospital systems and specialist providers tend to see higher healthcare costs due to the premium-tier pricing those institutions command. States with less dense healthcare infrastructure often have lower average costs but also potentially less access to specialized care, a trade-off that matters most for households with chronic conditions or older family members.

The Efficiency Gap: Purchasing Power of $100k by State

Gross salary is often a misleading metric for financial health. To understand the operational efficiency of an income, one must account for the dual impact of state-level taxation and the local Cost of Living (COL) Index. The table below calculates the “Real Value” of a standard $100,000 salary, revealing how significantly geographic overhead can compress or expand a household’s actual spending power.

Using Cost of Living Data to Make a Moving Decision

The index rankings above give you a useful starting point, but translating state-level data into a genuinely useful moving decision requires a few additional layers of analysis that the broad rankings can’t show you on their own.

City-level costs within a state vary more dramatically than most people expect. New York state’s overall index of 125.1 includes Buffalo at an index well below the national average and Manhattan where costs double the national baseline. Texas at 92.1 statewide includes San Antonio at genuinely affordable price points and Austin where home prices now exceed $500,000. Before committing to a state based on its statewide index, research the specific metro area or city you’re considering, because the number that actually shapes your financial life is the local market you live in, not the state average.

Income levels determine whether a state’s tax structure helps or hurts you. A household earning $50,000 in a no-income-tax state like Texas saves a few hundred dollars annually compared to paying Tennessee’s 0% or North Carolina’s 4.25%, but the calculation scales dramatically at $150,000 or $250,000 where California’s 13.3% or New York’s 10.9% represent genuine five-figure annual differences. The higher your income, the more state income tax drives total cost differences between states, and the more a no-income-tax destination improves your effective financial position.

Quality of life factors that don’t appear in cost indexes deserve honest weight alongside the numbers. States at the bottom of the cost ranking, including Mississippi, West Virginia, and Arkansas, carry trade-offs in healthcare infrastructure, educational quality, and economic opportunity that matter differently for different households. A remote worker with strong income who values low housing costs and outdoor access may find West Virginia a genuinely excellent choice. A household that relies on proximity to major medical centers or specialist care may find that the cost savings come with risks that don’t make financial sense to accept.

FAQ

What is the most affordable state to live in for 2026?

Oklahoma ranks as the most affordable state in 2026 with a cost of living index of 86.0, approximately 14% below the national average. Housing costs are among the country’s lowest, and the state’s growing job market in aerospace, bioscience, and energy provides employment options that many other affordable states lack at the same price level.

What is the most expensive state to live in for 2026?

Hawaii holds the top position at a cost of living index of 185.0, making it 85% more expensive than the national average. Housing costs three times the national baseline, groceries run 50% above average due to island logistics, and virtually all consumer goods carry shipping premiums that don’t exist in continental states.

How much does cost of living vary between the most and least expensive states?

The gap between Hawaii at 185.0 and Oklahoma at 86.0 represents a difference of nearly 100 index points against a national baseline of 100. For a typical household, that translates to roughly $2,000 to $3,500 per month in total spending differences, with housing accounting for the largest portion of that gap.

Which states have no income tax in 2026?

Nine states have no state income tax: Alaska, Florida, Nevada, New Hampshire (taxes interest and dividends only), South Dakota, Tennessee, Texas, Washington (has a capital gains tax), and Wyoming. Of these, Florida, Tennessee, and Texas draw the most domestic migration specifically because they combine no income tax with large metropolitan job markets and more temperate climates than the northern no-tax states.

What states offer the best combination of affordability and job opportunities?

Tennessee, Texas, Georgia, and North Carolina consistently rank as the strongest performers on the combined affordability-plus-job-market measure. All four sit at or below the national cost of living average, host multiple large metropolitan areas with diverse economies, and attract significant corporate relocation that continues to build employment density. Tennessee and Texas add the no-income-tax advantage on top of their cost position, making them particularly compelling for higher-earning households.

Is a low cost of living always a good reason to move to a state?

Cost of living should be one input into a relocation decision rather than the deciding factor. States at the bottom of the cost index frequently carry trade-offs including limited job markets, lower healthcare infrastructure quality, higher poverty rates, and in some cases challenging climate or geographic conditions. The most practically useful approach is to identify states that combine acceptable cost of living with the job market access, healthcare quality, school performance, and lifestyle characteristics your household specifically needs, and then evaluate the financial picture within that filtered group.

How do I estimate what I would actually save by moving to a lower-cost state?

Start with your current monthly housing cost and compare it to typical housing costs in your target destination at an equivalent lifestyle level, since housing drives 35% of the total cost differential. Add the annual income tax difference if you’re moving between states with different tax structures, divide by 12 for a monthly figure, and combine the two to get a working estimate of your monthly financial improvement. Factor in property tax differences if you’re buying, and healthcare insurance premium differences if you’re not covered through an employer, and you’ll have a reasonably accurate picture of your real financial position change before making any final decisions.

References

1. World Population Review: Cost of Living Index by State 2026 (Updated February 17, 2026)
2. World Population Review: Most Expensive States to Live In 2026
3. Living Cost Index: Cost of Living Index by US State 2026
4. Extra Space Storage: Most Affordable States to Live in 2026
5. Yahoo Finance: The 10 Cheapest States to Move to in 2026
6. USACLI: 10 Most Expensive States to Live In 2026
7. Yahoo Finance: What Will It Cost to Live Comfortably in Every State in 2026?