Cost of living refers to the amount of money needed to cover basic expenses such as housing and healthcare, and it’s dependent on where you live. So, living in Albany, New York costs less than the Big Apple, but how much less exactly? Crunching real numbers is the best way to compare cost of living across cities and towns so you can focus on places that fit your budget.

A price of living calculator accounts for variables from food bills to gas tank fills, which can factor heavily into weekly expenses.

The Cost of Living Index (COLI) data in this calculator is from the Council for Community and Economic Research (C2ER), one of the most trusted resources for historical and current cost of living data since 1968.

If you’re thinking of moving to a new town, the Cost of Living Calculator is more than just a tool—it's a crucial part of your home buying journey. Here’s how it can help:

1. Budgeting: Knowing the cost of living in a new city helps you budget not just for your mortgage, but your day-to-day expenses. This ensures that your dream home is both attainable and sustainable, keeping your lifestyle and financial health in harmony.
2. Negotiating your salary: If you’re relocating for a job, understanding the cost of living in your soon-to-be hometown can help you negotiate a salary that works for your lifestyle.
3. Choosing the perfect spot: Maybe you have a couple of areas in mind for your move. A Cost of Living Calculator can compare these areas side by side, helping you choose the one that makes the most financial sense.
4. Planning for what’s next: Knowing your cost of living can help you plan more effectively. Whether it’s saving for your children's education or planning for retirement, understanding your expenses is everything.
5. Understanding market differences: Every town has its unique real estate heartbeat. A Cost of Living Calculator helps you understand how much house you can afford in different markets so you can invest wisely.

In a country as big as the U.S., living costs differ dramatically depending on where you plant your roots. Here are the categories that are usually factored into a living costs calculator:

• Housing: your biggest expense
  This is probably your top consideration, and for good reason. The price of homes can vary wildly from place to place. This calculator will show you the dramatic variations in rent and mortgage expenses around the country.
• Healthcare: prioritizing wellness
  Healthcare is also a biggie, especially if you have specific needs, and costs can vary from location to location. If you're set on a place with a lot of hospitals and clinics, your healthcare costs may be lower, thanks to the competition. On the flip side, more rural spots might have steeper costs because there are fewer options.
• Food: what’s for dinner?
  Another hefty expense for most of us, groceries can vary greatly depending on where you live. Everything from local taxes to labor and transportation costs can affect what your weekly stash of protein, veggies and snacks will run you.
• Utilities: keeping the lights on
  Monthly utilities can include electricity, water, gas, internet and maybe even propane if you’re headed to a cozy cabin in the woods. There’s no getting around these expenses (unless “off-the-grid” is your ultimate goal), so it’s good to get a handle on average costs in the locations you’re scouting.
• Transportation: getting around
  For rural and suburban folks, the price of gas and car payments are top of mind. For city dwellers who can hop on a bus or walk wherever, those costs don’t come into play as much. It’s good to explore your transportation options so you can work them into your budget.
• Taxes: budgeting for the inevitable
  Nobody escapes Uncle Sam’s annual invoice. State and local taxes can significantly impact your cost of living, with some areas charging far more in property or sales taxes than others. The good news? Homeowners may be able to subtract mortgage interest from their taxable income.
• Extras: living your best life
  Along with cold, hard bills, the cost of living also includes some extras that make life enjoyable. If your new town comes with museums, concerts, festivals and a vibrant food scene, that can impact the cost of living there.

A living expenses calculator gives you the big financial picture so you can budget for home buying as well as your living expenses. A good rule of thumb is the 50/30/20 budgeting method. Here’s how it works:

• 50% needs: Half of your income should go towards necessities like rent, utilities, groceries and transportation.
• 30% wants: About 30% can be spent on things you enjoy but don’t necessarily need, like dining out, hobbies and entertainment.
• 20% savings and debt: The remaining 20% should be set aside for savings, investments and paying off any debts.

You might need to make tweaks based on your unique situation and financial goals, but this method is a solid starting point.

Whether you're actively looking to buy or simply exploring, the Cost of Living Calculator is a great way to visualize what life could be like elsewhere. So, crunch those numbers before you sign on the dotted line and pack your bags. You might be surprised by what you discover!