Based on the most costly metro areas in the country, the Golden State is currently the fifth-most expensive in the country, according to an annual study conducted by CNBC. It was found that the average home price this year, based on data for San Francisco, is just under $800,000, with average monthly rent at $2,524. In addition, the average gallon of regular gas is a whopping $3.74.
Meanwhile, housing isn’t the only thing that’s expensive in California. Entertainment can also cost residents a pretty penny. Specifically, the average T-bone steak is $10.25 and a movie tickets will run you just under $11.
New York is another state that has a very high cost of living. Based on Manhattan numbers, the average home price is roughly $1.2 million. In addition, the average renter in the city is looking at a cost of $3,378 per month.
Not only is the Big Apple home to some of the most expensive car insurance rates in the country, but the average gallon of gas costs $3.88. Based on these averages, it would be very easy for the everyday American to fall behind on their monthly expenses.
However, expenses in these two cities are minimal compared to the cost of living in Honolulu, which was named most expensive in the country. The average price of a house in the Aloha State at the beginning of 2012 was $659,530, with rent topping $2,600.
Meanwhile, consumers in Hawaii have to pay much higher prices for goods and services since they are so expensive to transport into the state. As a result, the average cost for a gallon of gas is just under $4.
Creating A Household Budget
No matter where you live, you will undoubtedly need to have a sound spending and saving plan to stay on your financial feet. While this is sometimes easier said than done, there are a number of ways to get the ball rolling.
You may think you know exactly how much money you make every year, but when you consider state and federal taxes as well as Social Security payments and Medicare withholding, this can quickly take a chunk out of your income. In addition, depending on your personal situation, account for other expenses, such as alimony or child support.
Once you determine how much money you actually put in the bank at the end of every month, this will be the foundation on which you start to construct your household budget.
Keep Track Of Spending
The best way to determine where to properly allocate funds is to figure out where your money is already going. Try to keep track of your spending for at least two months to get an idea.
As a rule of thumb, you should spend no more than 30 percent of your monthly income on housing and between 15 and 20 percent on food. In addition, if you have credit card debt, car payments or student loans, allocate an additional 15 to 20 percent of your income to pay these off.