What is Cost of Living?Cost of living is the amount of money one needs to maintain a particular standard of living in a given location. The prices of goods and services vary from city to city, so those who are planning on moving to a new city would benefit from having this information, as it provides an accurate estimate of how much it will cost to live there. In general, the basic expenses included in determining the cost of living for a location are housing costs, goods and services, food and groceries, utilities, transportation expenses, healthcare, and taxes.
If you want to compare the cost of living in your current location to that which you are considering relocating to, the cost of living index would help you assess how your move would affect your budget. The cost of living index lists all the basic expenses and shows the percentage variance in the cost of living between two or more locations. The values for all the items listed under the primary location are fixed at 100, while the ones for the other locations which are being compared to the primary location may more or less than 100, depending on whether the costs in these cities are higher or lower than those of the primary location.
For example, if you currently live in Davis, CA and are thinking of moving to Sacramento, the cost of living index for your current location which is Davis would always be 100, while the figures for Sacramento would be more or less than 100, depending on whether the items being compared to those of Davis are more expensive or cheaper in Sacramento.
2019 Cost of Living Index in Sacramento, CAThe income to cost-of-living ratio in Sacramento is very favorable to its residents, with an average annual income that is higher than the national average. If you are considering relocating to Sacramento, California, it would be advantageous for you to check the cost of living index in this city before you make your decision. The table below compares the cost of living in Sacramento with the rest of the state of California and the United States. The primary location here is the United States, so all of the values under this is fixed at 100, and the values under Sacramento and California vary, based on the actual values of the basic expenses in these locations.