What Does Cost of Living Mean?
Cost of living refers to the required amount of money to cover life’s basic essentials. Apparently, you need to have a certain amount in the bank to live a standard lifestyle. To begin with, you need to have shelter above your head, food on the table, and other basic necessities of life. Apart from these fundamentals of life, you also need to have access to reliable healthcare, education, and utilities. Now, to access these fundamental essentials, you need liquid assets; after all, there isn’t a lot you can do without money.
Notice, we are not talking about luxuries of life. Rather, we are strictly concerned with things that are essential to living a standard lifestyle. Without these, you can not even exist – if you do, you can not live a standard life. For example, if you do not shelter above your head, you can not survive for long. The same is true for food, basic healthcare, and education.
What Determines Cost Of Living?
Once you have access to these basic life needs, the cost of living changes. That is to say, the cost of living is closely linked with your income and the city that you live in. For instance, if you are living in New York and making $50k per year, you can live a standard lifestyle. On the other hand, you can live a standard lifestyle in the suburban areas of the United States even if you are making way less than $50k a year. The reason is that the cost of living in New York is high and low in suburban areas.
Apparently, it is your income and the area that you live in that determine your cost of living. Your cost of living will be different if you live in LA compared to the cost of living in Florida. Like it or not, you will need to ‘adjust’ your cost of living based on your income and the city you live in.
Nonetheless, it is essential to note here that the cost of living in the U.S has drastically increased from the beginning of 2022; the cost of basic essentials and goods like groceries, mortgages, and fossil fuels have gone up. Consequently, it has impacted every American regardless of their income and locality.
Use Cost of Living Calculator to Calculate Your Current Cost of Living
Calculating and comparing the cost of living (between two cities) is pretty easy if you use the cost of living calculator. In a few simple steps, here is how the cost of living calculator works:
– Enter your current city along with your area code.
– After following the prompts, enter your income.
– The calculator will give a total sum that would be required to live in a certain city, according to its cost of living.