Most seniors live out their days on a relatively stable income that is a combination of retirement savings and Social Security payments. Since it is difficult to increase your income once you stop working, The best way to extend your money It is to live in an affordable area. Fortunately, the United States is a diverse country with a wide range of places to live, and the cost differential from state to state can be surprisingly large. In some cases, moving to a neighboring state can simply add thousands of dollars to your annual retirement budget. That can be a large sum for many retirees, so it’s worth looking at the data to see what options you have — and situations you should probably avoid.
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To help in this regard, GOBankingRates obtained data from the Missouri Center for Economic Research and Information for all 50 states regarding the cost of groceries, health care, utilities, housing, transportation and miscellaneous items. The 10 most expensive states are listed in reverse order below, based on total cost of living.
Maine’s utility costs are below the national average, and grocery and health care costs come in a few percentage points above average. As with most states in the “lowest ten” list, housing is the biggest culprit, 26.6% above the national average. The state’s overall expenditure index is only 116.9, however, the benefits of living in the state for some retirees will justify its slightly above-average expenditures.
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9. New Jersey
Healthcare costs in New Jersey come in at 3.5% below the national average, helping to keep the total cost index at 118.6 not too expensive. In fact, excluding housing costs—which are 41.9% higher than the national average—costs in categories such as groceries, utilities, transportation, and miscellaneous costs are relatively manageable, ranging from 3.1% to 12.4% above national standards.
There are two major mistakes of seniors trying to increase their retirement money in Oregon. The first is housing, which is 44.3% higher than the national average. But transportation is also a huge cost in Oregon. In fact, the state has the dubious distinction of having the highest transportation costs in the country, coming in at a whopping 32.6% above the national average. Costs in all other categories in the state are more modest, ranging from 2.2% to 8.5% above average.
Maryland’s home prices are 62.7% higher than the national average but perhaps surprisingly, it has some of the lowest healthcare costs in the country. Only Kentucky, Arkansas, and Puerto Rico scored lower than Maryland’s 88.1 index, meaning costs in the state are 11.9% lower than the national average. A state total cost index of 125.1 means that you can expect your total expenditures across the board to be about 25% higher than state expenditures overall.
Excluding Puerto Rico, Alaska has the highest average interest expense of any US state and territory, with an index of 148.4. It also takes the title in terms of healthcare expenditures, which are 52.9% higher than the national average. Overall, costs are fairly high across the board, with grocery, housing, and miscellaneous expenses 35%, 20.3%, and 20.1% above national averages, respectively.
5. New York
New York is an interesting case because although many Manhattans associate it with the state and have high costs in general, the truth is that it has a lot of low-cost areas. In fact, at the state level, utility costs are actually below the national average, and other costs are only about 5%-18% above average. However, housing is on average expensive in the state, at over 90% of national standards. That’s enough to raise the spending index statewide to 136.8.
Known for being a high-cost state, California actually ranks fourth in terms of MERIC data. But many costs, such as health care, groceries, and miscellaneous expenses, are only 10%-16% higher than national averages. Housing is California’s biggest problem when it comes to costs, which are 93% higher than the national average. Facilities and transportation are also operating above national standards at 25% and 29%, respectively. Put it all together and Golden State will cost you about 40% more than average.
If you’re looking to live in Massachusetts, your housing costs will be about twice the national average—and that’s just the beginning. Overall, the cost of living in Massachusetts is approximately 50% more than the national average, with utilities, transportation, health care, and miscellaneous costs about 18%-30% more than the national average. The most affordable cost in Massachusetts is groceries, coming in at “only” 12.8% above average.
2. District of Columbia
The District of Columbia may be small, but it is powerful when it comes to the cost of living. In fact, DC residents have a higher cost of living than any state except Hawaii, with a cost index 54.5% higher than the national average. Housing costs are the biggest reason here, two and a half times more than the average, while miscellaneous costs are 17.1% more than the average. However, there are still some pockets of value in the capital; Health care costs, for example, are actually 2.6% lower than the average.
Hawaii may be the state of Aloha, but it also has a solid reputation for being an expensive place to live. Data from MERIC confirms this, with the state having the highest cost of living index in America. Housing is a major culprit, reaching more than three times the national average across the country. But it’s hard to avoid high costs in any category in Hawaii, with even the most expensive expenditure – health care – more than 20% above the national average. In general, you can expect your costs to be about 90% more than the national average if you choose to live in Hawaii, making it the toughest state for retirees to afford.
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