Living in California is a dream for a lot of people. It’s a state that has it all. If you’re an art lover you can head to the Los Angeles County Museum of Art (LACMA), the Getty, the De Young in San Francisco or a number of other galleries and museums. If you love food and wine, the Napa Valley could be the place for you. California has some of the country’s most beautiful terrain that you can hike, surf and drive your way through. It also has plenty to offer for sports fans.

When it comes to the state of California, it’s hard to arrive at a single cost of living. This is because some of America’s wealthiest and poorest counties are in the state. However, some factors such as the high-income tax rates apply in all parts of California. We’ve taken all these into consideration along with the range of prices to put together a cost of living guide to the State. Keep reading to find out everything you need to know.

Living Costs in California


Compared to other states like Hawaii, people in California play comparatively low utility bills. An average of 560 kWh is consumed by Californians per month, leaving them with average monthly bills of about 90$. This makes utility costs in California lower than the national average which is about 114$.


The traffic situation can get pretty insane in many parts of California and gas prices are on the higher side. The average cost of a gallon of gas is 2.8$ according to the website, After Hawaii it is the state with the highest prices when it comes to gas.

Another thing to consider whether you’re driving in California or somewhere else in the U.S is vehicle insurance. In terms of insurance, the annual average in California is over double the average of other parts of the united states. According to a 2015 study, the average monthly premium is 164$ which brings the annual rate to a whopping 1,960$.

The Golden State does have good public transport options, but the fees vary in different parts. For instance, the monthly pass costs 70$ in San Francisco, while it will cost 100$ in LA.


According to a recent study, a single adult in California with no children requires an annual income of 25,600$ before taxes. This is for basic necessities and does not account for luxuries. Food expenses are estimated at 3,600$ per year. However, within California food expenses vary widely. You’ll obviously be spending more money if you’re buying locally grown food from the farmer’s market rather than necessary grocery items.


Unfortunately, California has the highest income taxes compared to any other state in America. The rate is 12.3% for people in the top rung. However, it does have the advantage of being a progressive system, which means that people at the bottom play only 1% in income taxes. The super-rich, who have an income of over 1 million dollars are required to pay a surcharge of 1% over the 12.3%.

In terms of sales tax, the state has the highest rate of 7.5%. On top of this, some parts of California have tax rates as high as 10% since counties can add additional taxes of their own.

The good news is that the property tax rates in California are much lower than the national average of 1.192%. The average rate is 0.813% in the Golden State.

Housing Costs

Housing and rent costs are the most significant expenditures for most people. In the state of California, housing costs vary widely from ultra-expensive Los Angeles and San Francisco to small rural towns.

So, the average price of buying a two-bedroom flat may be as low as 150,000$ in Lake County California, which is one of the poorest counties to as much as 650,000$ in affluent Santa Clara County.

If you’re still wondering whether to rent or buy, you should do some research about the rental market in the state. The cost of rent has become unbelievably high in some of the larger cities, and this has impacted the overall rent market.

The average rent for a studio apartment in California is 1,600$ which is over 600$ higher than the national average. If you’re seeking a one-bedroom place, you’re likely to pay around 1,550$ which is again much higher than the average rate. Two-bedroom houses carry an average rent of about 2,000$, and you can expect to shell out around 2,600$ for a three-bedroom apartment.

Another factor to consider is that mortgage rates and housing costs can vary from one city to the next since mortgage rates differ between local and national banks.

It’s not easy to be a renter in California, and you can expect to pay much more than you would for a house in other states. If it is a possibility, it’s a good idea to buy a place instead of renting and build up some Equity. This way you’ll have a valuable asset in hand.

Final Thoughts

If you’re looking to move to the Golden state or simply make living there a bit less stressful, consider consulting a financial advisor. There are some top financial advisory firms in California that can help you manage your assets and give you the advice you need.  If you need a financial planner in Riverside, be sure to check out our specific page for that.

We hope the information above has given you an idea of how California compares to the national average on metrics like income, home value, and interest rates. So, whether you’re considering relocating to California, already live there or are just curious about the cost of living, we have all the basics covered.