Cost of Living in Cambridge, MA

An Overview of Cost of Living in Cambridge, MA

Getting a feel for the cost of living in Cambridge is essential for anyone planning to relocate, as it empowers them to make informed financial decisions, secure a comfortable lifestyle and maintain financial stability in their new environment. The cost of living in Cambridge is 201, which is 101% higher than the national average. Relocating individuals may need to adjust their savings and investment strategies based on the cost of living in the new location. It influences decisions about retirement planning, investments and financial goals.

The cost of living in Cambridge is among the highest in the country, making it a very expensive place to live. Only a small fraction of regions boast a cost of living that is at least 20% higher than the national average, and regrettably, Cambridge falls into this category, which may not be suitable for those seeking an economically favorable living environment.

Housing costs significantly influence the Cambridge cost of living index, typically accounting for a substantial portion of one's post-tax income. Regrettably, within this particular region, expenses related to both residential ownership and renting exceeded those observed in an average city by 292%. This entails elements such as housing and rental prices, mortgage interest rates and insurance costs.

Goods and services make up 33% of the total cost of living index score and are a large part of your everyday expenses. These items could include things like haircuts, salons, toothpaste, shampoo, clothes, movies, bowling, gym memberships or yoga. In Cambridge, you can expect to pay 21.6% more than average for these items, making it a more expensive place to live.

What Do Locals Say About the Cost of Living in Cambridge?

The real experts on a city are its residents. That's why we reached out to 15 locals to get their views on the cost of living in Cambridge. We surveyed the residents and asked them if they felt like prices were affordable or out of reach. The results were as follows. 13% found it budget-friendly with decreasing prices, while 87% said it's simply not affordable as prices have continued to rise.

Is Cambridge Affordable?

Is Cambridge affordable? This is a pivotal question, especially when mulling over a move, as affordability carries substantial weight in your decision-making process. Factors such as the cost of living index (discussed earlier), housing expenses and income levels all contribute to a location's affordability. For instance, in Cambridge, the median home price is 356.5% higher than the national average and monthly rent prices are 141.6% higher than the typical rates. Additionally, the median income levels play a role in affordability, with Cambridge boasting a median household income of $107,490, 94.3% higher than the national average.

What Factors can Influence the Cost of Living in Cambridge?

Transportation: In situations where public transportation is limited or nonexistent, local residents may be required to own and maintain their own vehicles, contributing to an elevated cost of living. Monthly expenditures may encompass fuel costs, insurance premiums, routine vehicle upkeep and possibly lease or financing payments. In Cambridge, the transportation index is 17.5% higher than the national average.

Subsidies: Certain cities or states may institute government subsidies or assistance programs designed to alleviate the financial burdens associated with the cost of living for their residents. These programs encompass a variety of support mechanisms, including Medicare, Medicaid, housing subsidies, low-income home energy assistance programs, school lunch programs, supplemental nutrition assistance programs, student loans, electric vehicle tax credits, affordable care act subsidies and farm subsidies. Areas that provide fewer subsidies may see an uptick in their overall cost of living.

Taxes: Regions that impose higher taxes, including sales and income taxes, can contribute to an increased cost of living. Higher taxes for everyday necessities such as clothing, utilities and food inevitably leads to higher expenditures. Additionally, a higher income tax rate can also play a role in elevating the overall cost of living. In Cambridge, the prevailing sales tax rate starts at 6.25%, and income tax rates kick off at 5%.

Where is the Data From?

The Cambridge cost of living data displayed above is derived from the C2ER cost of living index to provide a useful and reasonably accurate measure of living cost differences in urban areas. The index takes into account data from 300 independent researches, covering more than 60 goods and services across 6 different categories, to create an overall index for each area, with 100 being the average. The C2ER index does not include sales or income tax rates in their data, however AreaVibes does include both income and sales tax rates in the overall cost of living score for each area.