The cost of living index by state is a way of understanding where your money will go. As a price index, the cost of living index is a theorized measurement of how much it costs to live in a certain place over a given period of time. The purpose of a cost of living index is to help give you an idea about where you can expect to spend more money, such as rent or groceries every month, and where you might not be able to afford outside of the necessities.
Other categories that the cost of living index covers in many reports are transportation costs, utilities, and health care payments, as well as a separate category for miscellaneous costs that arise here and there. Let's take a look at the cost of living indexes for all fifty states.