- Inflation is hitting everyone hard right now, regardless of which state (or country) you live in.
- Some states are seeing a higher increase in the cost of living expenses than others.
- The highest state inflation rate (as of May 2022) is 13.5%, costing the average household in some places up to $825 more per month.
It seems like life is getting more expensive, no matter where you live. Inflation is an unavoidable reality right now, and it’s impacting people in countries all over the world. Things like gas, food, energy bills, and even housing continues to get more expensive. Part of it is definitely a result a two-year global pandemic. However, there’s plenty of evidence that plain ol’ corporate greed is also playing a part.
Regardless of the cause, your dollars don’t stretch as far as they used to. That’s a problem. The increased cost of living hasn’t hit the country evenly though. Some states got more expensive than others. If you live in one of these states (or were thinking about moving to one), you may want to reconsider your budget. These states have the highest increase in cost of living expenses in 2022.
Delaware
- State Inflation: 12.1%
- Average Monthly Increase Per Household: $660
The inflation rate in Delaware was 12.1%, as of May 2022. The Joint Economic Committee (JEC) of U.S. Congress released a report that estimates inflation will cost the average Delaware household an additional $660 per month. That’s just shy of $8,000 per year!
The only good news is that Delaware wasn’t previously on the list of the most expensive states to live in. They still aren’t, in fact, as inflation has also hit the more states where the cost-of-living was already above average.
ShutterstockMaryland
- State Inflation: 12.1%
- Average Monthly Increase Per Household: $673
Delaware’s direct neighbor has also been hit hard in 2022. It unfortunately boasts an identical inflation rate of 12.1%. The average monthly household cost of living increased even more though, by $673.
To make matter worse, Maryland was already one of the ten most expensive states to live in, with a C2ER cost of living index of 124 in 2021. That made it the eight-most expensive state to live in before. With high inflation, Maryland is even more expensive now.
ShutterstockTexas
- State Inflation: 13.3%
- Average Monthly Increase Per Household: $673
The Lone Star state wasn’t previously among the most expensive places to live in America. In fact, some of its cities routinely show up on lists of the cheapest cities in the county. (That’s not always a good thing, though, as it typically comes with low education levels and low-paying jobs.) Regardless, everything is bigger in Texas — including inflation rates.
The cost of living in Texas rose by 13.3% in May 2022. The average Texan household will spend an extra $673 per month, according to the JEC study. Despite the massive increase, Texas remains on the lower end of the scale when it comes to cost of living.
ShutterstockWyoming
- State Inflation: 13.5%
- Average Monthly Increase Per Household: $714
Like Texas, Wyoming wasn’t near the most expensive states before inflation starting roaring. It was actually in the bottom half of the list of most expensive states. It’s catching up in a hurry, though, thanks to a 13.5% inflation in May 2022. The JEC estimates the average Wyoming household will have to spend an $8570 per year just to meet basic expenses.
That cost breaks down to $714 a month — that’s a lot of extra money in a state that continues to cling to a $7.25 minimum wage. The low paying jobs and higher cost of living could be part of the reason that Wyoming’s population isn’t growing much these days. In fact, less people live there now than in 2015.
ShutterstockMontana
- State Inflation: 13.5%
- Average Monthly Increase Per Household: $695
Montana is a beautiful state, home to lush countryside and picturesque mountain views. Unfortunately, it’s also currently home to a massive 13.5% inflation rate. It’s going to cost the average household almost $700 in expenses every month. Previously, Montana had been almost square in the middle of the most expensive of the 50 states, sitting at 23rd.
Montana’s minimum wage is $9.20, which puts its growing population in a slightly better spot than Wyoming residents. Even still, Montana is one of the states currently being hit hardest by cost of living increases.
ShutterstockIdaho
- State Inflation: 13.5%
- Average Monthly Increase Per Household: $671
Idaho also reached a 13.5% inflation rate in May 2022. (Spoiler alert: that 13.5% mark is the highest, nation-wide. The rest of the states on our list also hit 13.5%. They just happened to be more expensive to begin with.)
The average monthly household expenses in Idaho rose by $671 in May. That’s just over $8,000 annually. Like many other states, the minimum wage in Idaho is just $7.25 (or even less for tipped workers). That’s going to leave plenty of citizens struggling to meet basic living expenses, as the bare minimum cost to survive continues to soar.
ShutterstockNevada
- State Inflation: 13.5%
- Average Monthly Increase Per Household: $731
For those who think that Nevada only consists of the glitz, glamor, and seemingly never-ending piles of cash in Las Vegas, this may be a bit of a surprise. Rest assured, there is actually a whole state surrounding Sin City — one that is now more expensive than ever. The top national rate of 13% hit Nevada in May. That’s bad news for a state that already had the 16th highest cost of living index.
The average Nevada household will see an extra $731 in expenses — over $8,700 annually. At least the state minimum wage is up to $10.50, higher than the federal limit. Regardless, Nevada residents will still be feeling the pinch in their wallets. We’d lightly suggest throwing an extra $100 down on red during your next visit to Vegas, but gambling to ease your financial problems is never the answer.
Arizona
- State Inflation: 13.5%
- Average Monthly Increase Per Household: $733
Narrowly beating out Nevada for third on our list of the states with the highest cost of living increases in 2022 is Arizona. While the 13.5% inflation rate stayed the same, the average household in Arizona will spend an extra $733 a month in living expenses — $2 more than Nevada residents.
Arizona was already the 18th most-expensive state to live in, before the pandemic-related inflation of 2021 and 2022 started to creep in. Helping matters slightly is the $12.80 state minimum wage, which should rise to about $13.85 in 2023. Unfortunately for Arizonians (and everyone else, really), wages almost never keep up with inflation rates. Especially when inflation is more than 2-to-3%.
ShutterstockUtah
- State Inflation: 13.5%
- Average Monthly Increase Per Household: $800
Utah has the unfortunate stigma of being the first state the hit the $800 mark, when it comes to the average monthly household cost of living increase. That’s a harsh reality for residents, who were used to living in the state that sat dead in the middle of the U.S. Cost of Living index at 25th.
With 13.5% inflation rates in recent months, Utah households will be paying over $9,600 per year for basic cost of living expenses like housing, utilities, and groceries. To make the financial crunch even worse, the state minimum in Utah is only the $7.25 federal rate.
ShutterstockColorado
- State Inflation: 13.5%
- Average Monthly Increase Per Household: $825
Colorado may have crystal clear lakes, gorgeous snow-capped mountains, and sprawling natural forests. All of that comes with a price, though. The 13.5% inflation rate in May 2022 hit The Centennial State as hard as anywhere else. According to the JEC, the average monthly cost per household increased by $825. That’s just shy of $10,000 a year!
The Colorado minimum wage is $12.56 per hour, which helps out residents slightly. Despite that, Colorado was already the 16th most expensive state to live in before inflation started to rage out of control. These new cost of living increases certainly aren’t going to help.
ShutterstockThe Bottom Line
Inflation is a fact of life. However, under normal circumstances you don’t notice it as much. Sure, things get a couple percent more expensive every year. But you often get a small cost-of-living income increase every year too. So your buying power often remains roughly the same. However, when inflation explodes like it has in 2022, things are different. You need to figure out to make 10% more money just to keep up in most states. And in the ones highlighted on this list, even that may not be enough.
Luckily, there are some things you can do to combat inflation. Investing in the stock market (and especially Real Estate Investment Trusts) can help you money maintain its buying power over time. Of course, money invested can’t be used to pay the rent or gas up your car, making it a moot point for many living paycheck-to-paycheck. If you’re hurting financially and living in one of these states, it may be time to consider re-locating.
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