Cost of Living in California 2022

With sun and blue skies, living in the Golden State can be golden. But all that sunshine comes at a price.

California has one of the highest costs of living in the United States. If you’re considering a move to this much-loved West Coast state, it’s important to be informed about how expensive it is to live in California and the expenses you’ll have.

From housing costs to groceries, we break down what you need to know below.

What is the Average Cost of Living in California?

California living expenses are some of the highest in the nation. According to the Bureau of Economic Analysis (BEA), average cost of living per person California is $46,636 per year,¹ making it America’s third most expensive place to live.²

How much is the monthly cost to live in California?
Using the BEA’s annual California cost of living estimate ($46,636) as a guide, the average monthly cost of living in California is roughly $3,886.

How much money do you need to live comfortably in California?

Living comfortably in California depends on your definition of comfort. It also depends on which area of the state you’d like to live. While some areas feature some of the highest costs of living in the country, others are more reasonable. Overall, housing costs are the most expensive of all other states except Hawaii.¹

According to BEA statistics, you’ll need an income with at least $46,636 per year of take-home pay just to meet the average cost of living in California. That works out to about $3,886 per month. Things like savings and extras would be above and beyond that.

Housing Costs in California

Housing is twice the national average in California. A typical single-family home will set you back $683,996. Renting comes at a high cost, too, with the average rent for a two-bedroom apartment coming in at $1,614 per month.³

Utility Costs in California

You may pay a lot for housing in California, but you’ll get a break when it comes to your utility bill.

Californians pay an average of 23.22 cents per kilowatt-hour, which makes the state’s average monthly electricity bill a reasonable $101.49. That’s about $20 less than the national average.⁴

Transportation Costs in California

From gas to insurance, owning a car costs more in California, too. As of March 2022, a gallon of regular gas in California cost an average $5.77– the most expensive in the nation.⁵

Insurance premiums will set you back as well. Californians have the fourth-highest average annual premium — $1,966 — $500 more than the national average of $1,428.⁶

There’s no break when it comes to public transit either. The state’s two public transit hubs, Los Angeles and San Francisco, feature monthly passes well above the national average of $67, at $122 and $91, respectively.⁷

Health Care in California

With the fourth-highest health care costs in the nation, Californians spend $9,859 every year for health care services, nearly $2,000 more than the national average.⁸

Taxes in California

Californians get a break when it comes to average property taxes (0.79%, versus the national average of 1.19%).⁹ Steep income taxes, however, make up for it. With a top income tax rate of 13.3%, the state has some of the highest income taxes in the country.¹⁰

Sales tax is high as well, clocking in at 7.25%, but can go as high as 10.25% depending on where in the state you’re shopping.¹¹

Food Prices in California

California food costs are also higher than the national average. A single adult should expect to spend an average of $3,468 per year on groceries, $228 more than the national average. For a family of four, the number jumps to an average $10,016 per year, $662 higher than the national average.¹²

What's the cheapest place to live in California with the lowest cost of living? Boasting a median home value of just over $150,000, Clearlake is one of the cheapest places to live in the California. The northern city also boasts the state’s largest natural freshwater lake, a historic downtown and thriving wine scene.¹³

California dreamin’

If you have dreams of living in the Golden State, don’t let a hefty price tag deter you. With some research and preparation, it can be attainable – and we have financial planning resources to help you get there.

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1. https://www.bea.gov/news/2021/personal-consumption-expenditures-state-2020
2. https://worldpopulationreview.com/state-rankings/cost-of-living-index-by-state
3. Ibid
4. https://smartasset.com/mortgage/the-cost-of-living-in-california
5. Ibid
6. Ibid
7. https://www.valuepenguin.com/most-and-least-affordable-cities-commuting
8. https://worldpopulationreview.com/state-rankings/health-care-costs-by-state
9. https://smartasset.com/mortgage/the-cost-of-living-in-california
10. https://www.thebalance.com/state-income-tax-rates-3193320
11. https://smartasset.com/taxes/california-sales-tax
12. https://247wallst.com/state/cost-of-living-in-california
13. https://www.california.com/most-affordable-places-live-california/