The cost of living continues to put pressure on household budgets in 2026. Although prices do not rise at the same rate every month, consumers are still paying more for many essentials than they did just a few years ago. The Consumer Price Index increased 3.5% during the 12 months ending in June 2026, according to the U.S. Bureau of Labor Statistics. Food prices rose 3.0%, while shelter costs increased 3.3% over the same period.
At the same time, Americans are carrying significant credit card balances. WalletHub estimated that the average U.S. household owed approximately $11,000 in credit card debt in the second quarter of 2025. Altogether, households owed about $1.3 trillion on their credit cards.
Where you live can make an enormous difference in how far your income stretches. Housing, groceries, utilities, transportation and health care can cost substantially more in one state than another. For households already carrying credit card balances, those differences can leave less money available for savings or debt repayment.
So, which states are the most expensive places to live in 2026—and how much credit card debt does the average consumer carry in each one?
How the Cost of Living Index Works
This ranking uses first-quarter 2026 data from the Missouri Economic Research and Information Center (MERIC). MERIC calculates a state cost of living index by averaging data from participating cities and metropolitan areas in each state. The underlying information comes from the Council for Community and Economic Research (C2ER).
The national average is set at 100. An index of 120 means living costs are approximately 20% above the national average, while an index of 90 indicates costs are about 10% below average.
The index compares six major spending categories:
- Groceries
- Housing
- Utilities
- Transportation
- Health care
- Miscellaneous goods and services
Statewide averages are useful for comparison, but costs can vary considerably within a state. Living in a major coastal city, for example, may be much more expensive than living in a smaller community in the same state.
The 20 Most Expensive States to Live in 2026
| Rank | State | Cost of Living Index | Average Household Credit Card Debt |
|---|---|---|---|
| 1 | Hawaii | 184.8 | $15,100 |
| 2 | Massachusetts | 147.8 | $11,500 |
| 3 | California | 140.5 | $13,800 |
| 4 | Alaska | 129.0 | $13,600 |
| 5 | New York | 124.7 | $12,000 |
| 6 | Maryland | 121.1 | $12,700 |
| 7 | New Jersey | 118.8 | $12,900 |
| 8 (tie) | Maine | 114.6 | $9,600 |
| 8 (tie) | Washington | 114.6 | $11,800 |
| 10 | Connecticut | 114.2 | $12,500 |
| 11 | Vermont | 113.0 | $9,800 |
| 12 | Rhode Island | 111.2 | $11,100 |
| 13 | New Hampshire | 110.1 | $11,300 |
| 14 | Oregon | 109.6 | $10,700 |
| 15 | Arizona | 107.6 | $12,000 |
| 16 | Montana | 105.9 | $10,100 |
| 17 | Colorado | 101.8 | $12,000 |
| 18 (tie) | Delaware | 101.7 | $11,600 |
| 18 (tie) | Idaho | 101.7 | $10,900 |
| 20 (tie) | Florida | 100.7 | $12,600 |
| 20 (tie) | Nevada | 100.7 | $12,800 |
Because Florida and Nevada share the same overall index, both are shown at No. 20. Cost-of-living figures are from MERIC's first-quarter 2026 data. Household credit card debt estimates are from WalletHub's second-quarter 2025 analysis of TransUnion, Federal Reserve and U.S. Census Bureau data and are rounded to the nearest $100.
1. Hawaii
Cost of Living Index: 184.8 | Average Household Credit Card Debt: $15,100
Hawaii remains the most expensive state in the country by a wide margin. Its overall cost of living is nearly 85% above the national average. Housing is the largest factor, with an index of 302.4—more than three times the national benchmark. Groceries, utilities and transportation are also exceptionally expensive because the state relies heavily on goods and fuel shipped from outside the islands. Hawaii also has the nation's highest average household credit card debt at approximately $15,100.
2. Massachusetts
Cost of Living Index: 147.8 | Average Household Credit Card Debt: $11,500
Massachusetts ranks second, with overall living costs nearly 48% above the national average. Housing is the main source of pressure: its index of 217.5 means housing costs are more than double the national benchmark. Utilities and health care are also substantially above average. Massachusetts households carry approximately $11,500 in credit card debt on average.
3. California
Cost of Living Index: 140.5 | Average Household Credit Card Debt: $13,800
California's overall cost of living is roughly 41% above the U.S. average. Housing remains the biggest expense, especially in coastal markets such as San Diego, Los Angeles, Orange County and the San Francisco Bay Area. Transportation and utilities are also among the highest in the country. California households average approximately $13,800 in credit card debt, the second-highest amount nationally.
4. Alaska
Cost of Living Index: 129.0 | Average Household Credit Card Debt: $13,600
Alaska is nearly 29% more expensive than the national average. Its remote geography raises the cost of transporting food, fuel and other necessities. Groceries, utilities, transportation and health care are all more than 20% above average. Its average household credit card debt is approximately $13,600, the third-highest amount in the country.
5. New York
Cost of Living Index: 124.7 | Average Household Credit Card Debt: $12,000
New York's statewide cost of living is about 25% higher than average, driven primarily by housing. The state's housing index is 172.3. New York City and its surrounding communities heavily influence that figure, while many upstate areas are considerably more affordable. New York households carry approximately $12,000 in credit card debt on average.
6. Maryland
Cost of Living Index: 121.1 | Average Household Credit Card Debt: $12,700
Maryland's overall index is 21.1% above average. Housing is the most significant factor, with an index of 149.1. Costs tend to be highest in communities near Washington, D.C., and Baltimore. The state's average household credit card debt is approximately $12,700.
7. New Jersey
Cost of Living Index: 118.8 | Average Household Credit Card Debt: $12,900
New Jersey is nearly 19% more expensive than the national average. Housing costs are approximately 44% above average, while groceries, utilities and health care also carry above-average indexes. New Jersey households average approximately $12,900 in credit card debt, the fourth-highest amount in the country.
8. Maine
Cost of Living Index: 114.6 | Average Household Credit Card Debt: $9,600
Maine ties with Washington at 14.6% above the national average. Housing is roughly 35% above average, while utility and health care expenses are also elevated. Despite those pressures, Maine's average household credit card debt is approximately $9,600, below the national household average.
8. Washington
Cost of Living Index: 114.6 | Average Household Credit Card Debt: $11,800
Washington reaches the same overall index as Maine, but its cost profile is different. Transportation is 31.2% above the national average, and housing is 23.1% higher. Washington households average approximately $11,800 in credit card debt.
10. Connecticut
Cost of Living Index: 114.2 | Average Household Credit Card Debt: $12,500
Connecticut's cost of living is 14.2% above average. Housing and utilities are the largest contributors, with each running more than 20% above the national benchmark. Its average household credit card debt is approximately $12,500, well above the national household average.
11. Vermont
Cost of Living Index: 113.0 | Average Household Credit Card Debt: $9,800
Vermont is 13% more expensive than the national average. Housing costs are 27.5% above average, and utilities are 12% higher. Yet its average household credit card debt is comparatively low at approximately $9,800.
12. Rhode Island
Cost of Living Index: 111.2 | Average Household Credit Card Debt: $11,100
Rhode Island's overall cost of living is 11.2% above average. Utilities are particularly expensive at 22.3% above the national benchmark. Its average household credit card debt is approximately $11,100, close to the national household average.
13. New Hampshire
Cost of Living Index: 110.1 | Average Household Credit Card Debt: $11,300
New Hampshire is about 10% more expensive than the country as a whole. Housing and utilities are each roughly 16% above average. New Hampshire households carry approximately $11,300 in credit card debt on average.
14. Oregon
Cost of Living Index: 109.6 | Average Household Credit Card Debt: $10,700
Oregon's overall index is 9.6% above average. Housing, transportation and health care all run at least 15% above national levels. Its average household credit card debt is approximately $10,700, slightly below the national household average.
15. Arizona
Cost of Living Index: 107.6 | Average Household Credit Card Debt: $12,000
Arizona is 7.6% more expensive than the national average. Housing is the state's biggest cost driver at 19% above average. Arizona households average approximately $12,000 in credit card debt.
16. Montana
Cost of Living Index: 105.9 | Average Household Credit Card Debt: $10,100
Montana's cost of living is 5.9% above average. Housing costs are 13.2% higher, and health care and miscellaneous expenses also exceed national levels. Its average household credit card debt is approximately $10,100.
17. Colorado
Cost of Living Index: 101.8 | Average Household Credit Card Debt: $12,000
Colorado sits 1.8% above the national average. Housing and miscellaneous expenses keep the state on this list, while utilities and transportation are below average. Even with an overall index close to 100, Colorado's average household credit card debt is a relatively high $12,000.
18. Delaware
Cost of Living Index: 101.7 | Average Household Credit Card Debt: $11,600
Delaware's overall cost is 1.7% above average. No single category is dramatically higher, but groceries, housing, health care and miscellaneous expenses all slightly exceed the national benchmark. Delaware households average approximately $11,600 in credit card debt.
18. Idaho
Cost of Living Index: 101.7 | Average Household Credit Card Debt: $10,900
Idaho ties Delaware with an overall index of 101.7. Housing is 5.1% above average, while miscellaneous expenses are also elevated. Its average household credit card debt is approximately $10,900, close to the national household average.
20. Florida
Cost of Living Index: 100.7 | Average Household Credit Card Debt: $12,600
Florida is slightly above the national average overall. Groceries, housing and health care are all modestly higher, while utilities are below average. However, Florida's average household credit card debt is approximately $12,600, substantially above the national household average.
20. Nevada
Cost of Living Index: 100.7 | Average Household Credit Card Debt: $12,800
Nevada ties Florida at 0.7% above the national average. Transportation stands out at 15.6% above average, and housing is 10.5% higher. Nevada households average approximately $12,800 in credit card debt, the fifth-highest amount nationally.
What Makes a State Expensive?
Housing is the biggest differentiator in many of the states at the top of the list. Hawaii, Massachusetts, California and New York all have housing indexes far above the national average. However, housing is not the only concern. Remote states such as Hawaii and Alaska face high shipping and energy costs, while several Northeastern states have elevated utility and health care expenses.
Income also matters. A higher salary may help offset a higher cost of living, but gross pay does not tell the whole story. Taxes, insurance, commuting, child care and debt payments all affect how much money remains at the end of the month.
Does a Higher Cost of Living Mean More Credit Card Debt?
The figures show a relationship in several states, but not a perfect one. Alaska, Hawaii, Connecticut, New Jersey, Maryland and California combine high living costs with household card debt well above the national average. When a larger share of income goes toward necessities, an unexpected expense can be harder to absorb without borrowing.
However, Maine and Vermont demonstrate why cost of living alone does not determine credit card debt. Both rank among the most expensive states, yet their average household balances remain below $10,000. Income, credit limits, household size, spending, age, housing status and repayment habits all influence the amount a household carries.
An average is a point of comparison—not a recommended balance or a measure of whether an individual is financially healthy. A smaller balance at a high interest rate can be more difficult to manage than a larger balance supported by sufficient income and an aggressive repayment plan.
How to Manage Debt in a High-Cost State
Living in an expensive state does not automatically mean you need to move. However, it does make it especially important to understand where your money is going.
Start by reviewing your spending in the categories most likely to strain your budget:
- Compare your housing payment with your take-home income.
- Review insurance, utility and subscription costs at least once a year.
- Plan grocery purchases and limit food waste.
- Consider the full cost of transportation, including fuel, maintenance, insurance and loan payments.
- Avoid relying on credit cards to cover recurring expenses whenever possible.
If high living costs have contributed to growing credit card balances, a nonprofit credit counselor can help you review your budget and explore available options. Depending on your situation, a debt management plan may help reduce interest rates and combine eligible credit card payments into one monthly payment—without taking out a new loan.
Contact DebtWave or get started online for a confidential review of your financial situation.
Sources
- Missouri Economic Research and Information Center: Cost of Living Data Series, first quarter 2026
- U.S. Bureau of Labor Statistics: Consumer Price Index Summary, June 2026
- WalletHub: Credit Card Debt by State, second quarter 2025 household estimates
Life’s a bitch and then you die!
This is so very very true about the state of New Jersey it’s extremely difficult to live here in your senior years with the very very high cost of living every one is trying hard to get out asap
I’m in Washington, we our out of control with the mass people moving here!
Traffic is a complete nightmare every day!
We are voting to raise our taxes! Nobody in this state can balance the budget!
We have lawlessness everywhere crime is bad! They are going to tax us out of our homes! I’m kinda feeling like California! Our Governor is modeling after Newsom!
They want more money to care for the illegals/refugee’s! And the American Taxpayers to pay for it!
Here in oregon, the whole state is judged and controlled by Portland and the six or seven liberal counties surrounding it, whatever they do effects all of Oregon. They say it’s because Oregon is a big business hub. I don’t know what big business hub they are talking about. Businesses are leaving this state. The taxes and regulations are killing businesses. But yet prices on everything are high. We don’t have a sales tax in this state you would think we would be doing much better. But they raise the other taxes so high to make up for no sales tax that businesses cannot make it here.