What’s the cost of living in New Mexico?
When considering a move to a new state, understanding the cost of living is vital for effective budgeting and financial planning. If New Mexico is at the top of your list, here are some current statistics related to the cost of living in the state that could help you make up your mind.
The average cost of living in New Mexico
New Mexico is home to over 2.1 million people.
According to research, the cost of living in New Mexico is 5% lower than the national average.
While according to data gathered in 2022 from MERIC, the Missouri Economic Research and Information Center, the state ranks 19th in a list of states with the lowest to the highest cost of living.
Housing costs in New Mexico
As of March 2023, the average home value in New Mexico is estimated to be around $279,763, according to the Zillow Home Value Index as of March 2023.
It’s important to note that housing prices can significantly differ across various regions within the state.
Typical Home Prices in New Mexico (Zillow Data):
Santa Fe: $534,146
Rio Rancho: $318,752
Las Cruces: $275,973
The monthly rental price ranges across the state for those considering renting in New Mexico. The average price of rental apartments nationwide is $1,702, while the monthly rent in Albuquerque, NM is $1,281, on average.
Utility costs in New Mexico
Utility costs play a significant role in New Mexico's overall cost of living. According to Forbes, the average monthly cost is around $362.
Average Monthly Utility Costs in New Mexico:
Phone bill: $114
Energy bill: $87.31
Natural gas: $60
Monthly water bill: $32
Grocery and food costs in New Mexico
When it comes to groceries and food costs, New Mexico generally aligns with prices found elsewhere in the United States.
According to Zippia, those in Albuquerque pay $307 on average each month.
According to 2021 data from the Bureau of Labor Statistics, the average spending on food at home is $5,259 annually, or about $438 per month for US households.
Transportation costs in New Mexico
Transportation costs, including gas prices and vehicle maintenance, impact New Mexico's overall cost of living.
According to MIT, a single adult with no children can expect to pay upwards of $5,300.
Gas prices in New Mexico are typically in and around the national average. New Mexico was at the national average at the time of writing. These prices fluctuate over time.
It is also worth noting that prices can vary across different regions within the state.
Healthcare costs in New Mexico
Understanding healthcare expenses is crucial when considering the cost of living.
The specific healthcare costs in New Mexico can vary depending on factors such as insurance coverage and individual circumstances. Therefore, it is advisable to research and consult with healthcare providers and insurance companies to obtain accurate cost estimates.
Annual Health Expenditure in New Mexico Estimated by MIT:
One adult, no children: $3,282
One adult, one child: $9,162
One adult, two children: $9,097
Two adults (one working), no children: $7,014
Two adults (one working), one child: $9,172
Two adults (one working), two children: $9,097
Two adults (two working), no children: $7,014
Two adults (two working), one child: $9,172
Two adults (two working), two children: $9,097
Childcare costs in New Mexico
Families in New Mexico currently pay around $7,515 per year for childcare for one child. This figure doubles for two children.
However, it's important to note that this figure can vary across the state.
Taxation in New Mexico
New Mexico’s state income tax rates range between 1.7% and 4.9%.
Taxes in New Mexico compared to neighboring states:
New Mexico Income Tax Rate: 1.7% - 4.9% (Marginal tax rates)
Arizona State Tax Rate: 2.59% - 4.5% (Marginal tax rates)
Colorado Income Tax Rate: 4.55% (Flat tax rate)
Oklahoma Income Tax Rate: 0.5% - 5.0% (Marginal tax rates)
Texas: No state income tax
The sales tax rate in New Mexico is 5.125%. However, it's important to note that additional local sales taxes may be imposed by municipalities and counties, which can vary. The total sales tax rate, including both state and local taxes, can range from 5.125% to 9.0625% depending on the location within New Mexico.
The bottom line
The amount of money needed to live comfortably in New Mexico can vary depending on location, lifestyle, family size, and personal preferences. However, as the most expensive state in the US, you may need more than you first think.
It's essential to consider these factors, along with personal circumstances and preferences, when evaluating the cost of living in New Mexico. In addition, consulting with a financial advisor can provide valuable insights and assistance in managing expenses and financial planning.
Whether you’re retirement planning or considering relocating to chase a new career, Unbiased can assist you with your move's financial ins and outs. Find the right advisor for your needs today.
Charlie Barton is a writer at Unbiased. He has been writing about personal finance and investing since 2017, with extensive knowledge of platforms and products. Charlie has a first-class degree from the London School of Economics.