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The Cost of Living in Colorado

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The Cost of Living in Colorado

U.S. Census Bureau data shows Colorado’s population grew by 1.4% from 2017 to 2018, which is the seventh highest rate in the nation. That growth probably isn’t surprising to anyone who’s visited or seen pictures of Colorado: It’s a beautiful state that’s perfect for nature lovers. But is Colorado affordable? The answer depends on where in the state you live. It also depends on how sound your financial plan is; if you need help figuring out what’s within your means, try speaking with a financial advisor.

Housing Costs in Colorado

Hearing “Colorado” conjures up visions of beautiful ski chalets and cabins in the mountains. Home values in Colorado took a serious dip after the recession but they’ve since rebounded. Colorado homes have appreciated 10.5% over the last year. As of the end of 2022, the median home value in the state stands at $580,275.

Under 41% of Colorado, residents choose to rent, as renting in the state is slightly more expensive than in the rest of the country. The average rent for an apartment in Colorado stands at $1,994 per month. The costs are going to depend on where you live, though. For Denver, the average one-bedroom cost is going to be $1,483 per month to rent while a two-bedroom costs, on average, $1,817 per month.

Cost of Utilities in Colorado

According to a report from the U.S. Energy Information Administration (EIA), residents of Colorado consume much less energy than the U.S. average. As a result, the average Colorado monthly bill is $142, or $1,704 per year. For further reference, the average across the country for energy is $2,451 per year. You can expect the total utility costs to average out at around $371 per month throughout the state.

Cost of Food

MIT’s Living Wage Calculator places the annual living wage of a single adult with no children in Colorado at $42,241. Of that income, MIT estimates that $3,999 will be spent on food, which makes up 9.4%. This percentage raises slightly for a family with two working adults and two children, as 13.6% of their income is spent on food. Overall, this is more affordable than states with access to similar amenities as Colorado.

Transportation Costs

According to May 2019 data from GasBuddy, the average price of a gallon of gas in Colorado is $3.53. That’s just below the U.S. average of $3.76. In Denver, though, gas averages $3.43 per gallon. In Fort Collins, drivers pay an average of $3.53 per gallon.

Public transportation is available in Colorado’s Regional Transportation District, with bus, rail and light rail service to Denver, Boulder and nearby cities. A month of access will cost you $114 or $200 depending on whether you want local or regional service.

Colorado Taxes

Colorado is a flat-tax state. The income tax rate in Colorado is 4.63% regardless of income level. That’s great if you’re rich, but not so great if you’re on the lower end of the income scale. The base sales tax rate in Colorado is 2.9%, though many cities add their own sales taxes on top of it. At a city level, sales tax can get as high as 10.40% (in the small ski town of Snowmass Village).

In case you were wondering, marijuana, whether medical or recreational, is subject to the 2.9% state sales tax plus any applicable local sales taxes, as well as an additional 15% sales tax and a 15% marijuana excise tax. There are also application and licensing fees for medical and retail marijuana sales that may apply.

Here’s some good news for homeowners: Colorado’s property tax rates are some of the nation’s lowest. The Centennial State has an average effective property tax rate of just 0.57%. The money Coloradans pay in property taxes stays within their county of residence. No property tax revenue goes to Colorado’s state government.

Healthcare Costs in Colorado

The average Colorado employee annually contributes about the national average for single coverage healthcare. A report from the Agency for Healthcare Research and Quality has Colorado ($4,428) which is significantly below the national average of $7,739. This points to healthcare being extremely affordable and accessible throughout the state, as well as Colorado being home to many businesses offering strong healthcare benefits to their employees.

Miscellaneous Cost of Living Facts

Colorado is famous for its ski slopes and ski towns. We all know that skiing can be a pricey pastime. Prices of lift tickets vary among Colorado resorts. One of the cheapest day passes is for Arapahoe Basin at $85. Breckenridge Resort is priced at $109 and a three-day pass at Steamboat will run you over $300.

The Bottom Line

The Cost of Living in Colorado

Moving to Colorado, as many people have over the past two decades, can be rewarding. You may find some of the amenities you’re looking for in either a destination, with the ski towns or with a big city like Denver without having to pay the costs of larger cities. There is plenty to do in Denver and throughout the state and the weather is full of sunshine for most of the year. Before making the move, consider the total cost of living compared to where you currently live and how that impacts your budget.

Next Steps for a Move to Colorado

  • Moving to a different state can wreak havoc on your financial life if you go into it unprepared. A financial advisor can help you with this transition, as well as other long-term financial decisions. Finding the right financial advisor that fits your needs doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
  • We’ve also taken the time to rank the top financial advisor firms in Colorado Springs and Denver.
  • There are a number of banks in Colorado that you can move your money to, such as FirstBank, Guaranty Bank and Trust Company, First Western Trust BankStockmens Bank and Colorado Federal Savings Bank.

Photo credit: © iStock.com/David Sucsy, © iStock.com/anatoliy_gleb

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