How Cost of Lifestyle Differs From Cost of Living in the US
If you’re wondering how the cost of lifestyle differs from the cost of living in the U.S., it’s important to understand the difference between the two. Cost of living is the money needed to cover your basic living expenses, such as food and shelter. Cost of lifestyle is the standard of living that you wish to maintain and includes expenses for things that are nonessential, such as wellness, beauty, travel and fashion.
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Both the cost of lifestyle and cost of living will be different for different people. The wealthier someone is, the more able they are to afford a higher cost of living and lifestyle if they so choose.
Here’s more on cost of lifestyle vs. cost of living, according to data compiled by Credello.
Also see the living wage needed for a single person in every state.
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How Much Money Does It Take To Be Wealthy?
There’s no doubt that being wealthy helps you afford a higher cost of lifestyle. But how much money does it take to be classified as wealthy?
It depends on which generation you’re speaking with, but the consensus among all generations is that it’s somewhere north of $1 million, according to Credello. Here’s the breakdown of how much money it takes to be wealthy, according to each of the following generations:
Gen Z: $1.49 million
Millennials: $1.94 million
Gen X: $2.53 million
Boomers: $2.63 million
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Cost of Living Across the US
The cost of living across the U.S. varies depending on which state you live in. For example, cost-of-living expenses, which include food and shelter, are highest in the following states and range from 15% to 84% higher than the national average:
Alaska
Hawaii
California
Oregon
Maine
New Hampshire
Vermont
New York
Massachusetts
Connecticut
Cost-of-living expenses in these states range from 5% to 14.9% above the national average:
Arizona
Washington
Rhode Island
New Jersey
Delaware
Cost-of-living expenses range from 5% below to 4.9% above the national average in these states:
Idaho
Montana
North Dakota
Minnesota
Wisconsin
Nevada
Utah
Colorado
Pennsylvania
Virginia
North Carolina
Florida
And finally, cost of living expenses range from 15% to 5.1% below the national average in the remaining 23 states, including Texas, Oklahoma, Kansas, Nebraska and South Dakota.
Shelter
Shelter is part of the cost of living. In some areas, it’s much more expensive to own a home.
According to Credello, millennials and Gen Zers either have opted to rent or have gone into debt due to expensive housing costs.
In 2020, the median U.S. home sale price was $329,000. However, as of Q4 2023, the median sale price for U.S. houses was $417,700, according to the Fed.
California, Oregon, Washington, Colorado, Florida and Texas all have metros that have experienced more than 200% increase in home value inflation.
The Northeast and Southern regions of the U.S. have the most metro areas that have experienced between a 100% and 200% increase in inflation.
Food
Here’s how much people in the U.S. spend annually on groceries — otherwise known as “food at home.”
Gen Z: $3,046
Millennials: $5,008
Gen X: $6,516
Baby Boomer: $5,112
Greatest Generation: $4,001
Cost of Lifestyle
The cost of lifestyle includes things that are nonessential — in other words, things that are not needed but make your life better.
Wellness and Beauty
Gen Zers and millennials spend the most on wellness and beauty expenses. Next are Gen Xers, followed by boomers, according to Credello. The silent generation did not report spending on wellness and beauty expenses.
According to a survey by StyleSeat, Americans spend an average of $76 monthly on beauty and wellness — $46 and $30, respectively. Haircuts and facial skincare ranked as the biggest beauty expenses, while sleep aids and mental health services were the biggest wellness expenses.
Travel
Like wellness and beauty expenses, Gen Zers and millennials spend the most on travel. Next are Gen Xers, the silent generation and boomers — in that order.
When asked how much they were prepared to spend on travel, respondents reported the following:
$4,001 or more: 15%
$3,001-$4,000: 20%
$2,001-$3,000: 21%
$1,001-$2,000: 20%
$501-$1,000: 18%
$0-$500: 6%
Fashion
Once again Gen Zers and millennials lead the pack when it comes to spending on fashion, followed by Gen Xers, boomers and the silent generation.
While millennials prefer to shop in store, often visiting multiple stores to find the best price, 33% of Gen Zers report buying items based on an influencer’s recommendation.
On average, Americans spend around $1,800 a year on clothing.
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This article originally appeared on GOBankingRates.com: How Cost of Lifestyle Differs From Cost of Living in the US