Alabama is one of the most vibrant states in the US with the best food, top-performing college football teams, and affordable housing. Alabamans are lively, energetic, and proud of their state. In the past few years, people from different states have chosen Alabama as their new home state. The southeastern state's population has grown to 5,070,000 residents. And it's attracting more and more people.
Most Americans assume Alabama is one of the best states to move in terms of affordable living costs. However, the opinion may be subjective because living costs vary for every individual. To have a clear picture of the costs, you need to make some accurate calculations. This blog covers everything about living costs in Alabama with the most recent figures. If you're planning to move, you shouldn't miss reading it.
Average Costs of Living in Alabama
According to the Bureau of Economic Analysis (BEA), the cost of living for an average US adult in Alabama is 39,657 dollars per year. It includes a variety of expenses and taxes that an average American pays. Moreover, Alabama ranks 4th on the list of most affordable US states in terms of cost of living (MERIIC, 2024). It’s listed after Mississippi, the other southeastern state in the top ranks.
The following table reflects the breakdown of living costs in different categories;
|
Category |
Average Annual Per-Capita Cost in Alabama |
|
Housing and Utilities |
$6,683 |
|
Health Care |
$6,545 |
|
Groceries and Food |
$3,261 |
|
Gas and Energy Goods |
$1,215 |
|
All Other Personal Expenditures |
$21,954 |
Apart from economics, most people also love Alabama because of its mild subtropical weather. The summers are warm and the winters are cool. The southeastern cuisines are already famous across the US and Alabama has it all. Moreover, the Alabamans are cheerful people to live with. The state's living expenses are below the national average which makes it a more attractive destination to move to.
What Are the Different Costs of Living in Alabama?
The average cost of living has numerous components, and each carries a different weight. These can include housing, utilities, healthcare, education, transport, grocery, etc. We’ll break down each component to see how much expenses you should expect living in Alabama.
Housing Costs in Alabama
Alabama has lower housing costs compared to the national average. The median estimate for a house cost in the US is 436,800 dollars. According to a recent estimate, you can buy a house in Alabama for 206,044 dollars (Zillow, 2023). Remember, these prices vary from city to city, here's a breakdown of city-wise house prices in Alabama:
|
Alabama City |
Typical Home Price |
|
Birmingham |
$234,928 |
|
Huntsville |
$282,092 |
|
Mobile |
$174,623 |
|
Montgomery |
$176,140 |
|
Tuscaloosa |
$202,629 |
|
Daphne |
$349,141 |
|
Florence |
$174,828 |
|
Anniston |
$139,199 |
|
Gadsden |
$148,308 |
|
Albertville |
$195,170 |
|
Selma |
$67,515 |
|
Troy |
$147,979 |
Rent & Utilities
The average rent in Alabama is within the $664 and $1,250 range per month. It varies in different cities, but the average estimate for rent is $861 a month across the state. You should expect to pay a little higher in downtown areas. Finding a house or apartment in Alabama is relatively easier than in other states.
Moreover, utilities are expensive in Alabama compared to other US states. One recent survey suggests that Alabamans pay about $398 per month for utilities. The major portion goes to electricity expenses. The electricity expenses tend to be higher due to fuel-based energy production.
Groceries & Food Costs
Groceries and Food costs are moderate in Alabama, you can expect to pay about $271.75 per month on average. When compared to the national average of $438 per month, the costs are quite low (BEA, 2021). Moreover, the taxes on groceries are the same across the US, the price variability is mostly in fresh produce.
Your groceries and food costs will be higher if you choose to live in urban cities like Mobile. Additionally, you must account for restaurant costs when eating out. Usually, restaurant costs are added to miscellaneous expenses because they're highly variable and change from person to person.
Transportation Costs
Transportation costs vary across different regions of Alabama. The cities mostly have well-developed public transport infrastructure which is relatively cheaper. However, considering the vast area of the state, you would most probably need a personal vehicle for traveling.
The fuel prices in Alabama are lower than the national average whereas vehicle maintenance, insurance, etc are within the average ranges. You must choose a fuel-efficient vehicle and plan your routes to save on transportation costs.
Healthcare Costs
Healthcare is the most crucial component of living costs anywhere in the US. According to a report from the Bureau of Economic Analysis (BEA), the average healthcare costs for an individual are $6,545 per year in Alabama. When compared to other southeastern states, Alabama has the second lowest healthcare costs.
There are numerous variables attached to healthcare costs like age, health condition, insurance plan, etc. You should calculate your healthcare costs and add them to the total cost of living. Make sure to explore multiple insurance providers, check reviews, and select affordable plans.
Government Taxes
Government taxes are an integral part of living costs in the US. Alabama has a 5% tax rate on the highest income bracket whereas the sales tax is around 4%. When compared to other southeastern states, the taxes in Alabama are relatively low. For instance, South Carolina and West Virginia have a 6.5% marginal tax rate which is well above Alabama.
When planning your budget make sure to include taxes for a fair picture. It’ll help you know the actual living costs of Alabama. The tax rates in Alabama can be slightly different from your current state.
Things to Consider When Calculating Total Living Costs of Alabama in 2024
Multiple factors will decide your total living costs in Alabama. We've shared details about different expenses with average amounts to help you determine your expected living costs and compare them with your current costs. Further, you need to be mindful of the following factors:
Location
The city you would choose will have a significant impact on the total living costs. A report from the Council for Community and Economic Research (CCER) suggests that Anniston, Florence, and Mobile have the lowest living costs in Alabama.
Lifestyle
Your lifestyle is another critical factor that determines the total living costs. If you prefer eating out every weekend, your living costs will rise above the average living costs discussed above. So, be mindful of your expenses when calculating total living costs.
Family size
The number of people in your family and the expenses of each individual will add up to give you the total living costs. Remember, the costs of a child tend to be lower than an average adult. Make sure you account for your family expenses accordingly.
How to Save Living Costs in Alabama
You can reduce your living expenses by planning your budget and making sound financial decisions. For instance, utility costs, especially electricity expenses are high in Alabama. You can eliminate electric bills using solar energy. The summers in Alabama are hot and the winters are equally colder. If you want to lower your electric expenses, solar power is the way forward!
BLUETTI is a top manufacturer of solar technology. It offers highly efficient solar generator kits to consumers with advanced features. You can start saving your electric expenses with the BLUETTI solar generator kits' range, let's explore!
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The system has a compact design for indoor and outdoor usage. The power station connects with your mobile phone via Bluetooth or Wi-Fi. You can control and monitor power consumption, charging status, and battery levels using the smart BLUETTI mobile application. The power station also has 16 ports to plug in different appliances and equipment. Overall the solar kit is a game changer that offers ultimate energy independence.
BLUETTI AC300 + B300 Home Battery Backup
The BLUETTI AC300 + B300 Home Battery Backup is a high-capacity solar generator kit that can power your entire house. The solar kit has an expandable capacity of 12,288Wh backed by advanced LiFePO4 battery packs. It supports blazing-fast recharge with dual input (AC+Solar) of about 5400W Max. The EPS mode is enabled to provide an uninterruptible power supply. You can also use the BLUETTI smart mobile application to control and monitor the system.
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Final Thoughts
That was all about Alabama's cost of living in 2024. You can compare the living costs in Alabama with your current costs to see if moving to the state is worth it. Remember, the cost of living varies for every individual. Your income can be higher or lower than the median range and that's what determines your lifestyle.
Although living in Alabama can be cheaper, it doesn't mean for everyone. Moving to any state to save on living costs is a critical decision, you must make an informed decision. There are also other ways to reduce living costs like investing in solar, opting for cheaper grocery options, and more. It all depends on how you think your way out!
