Beautiful skyline buildings of Texas at night.

Average Salary in Texas: Can You Afford the Cost of Living in Texas?

Texas is one of the fastest-growing states in the United States, and it’s not a surprise that many people want to move there. The cost of living in Texas is one of the things people take into consideration before relocating. This helps them to determine their expenditures and what standard of living they can expect. 

If a move is on the radar, this article explores the average salary in Texas, a salary comparison by major cities, and the average rent in Texas. It will also answer the question, “What is a good salary?”

What to Know Before Moving to Texas

There are a lot of things you should look into before moving to Texas, such as the job outlook and unemployment rate. Texas boasts outstanding job growth. Its larger cities are diverse, and it also has energy boomtowns. When you consider the somewhat affordable housing cost and rich culture, Texas is an excellent location to settle down in.

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According to the US Bureau of Labor Statistics, the unemployment rate in Texas was 4.7 percent in February 2022. Unemployment rates are also low at 4.7 percent in October 2021. Also, the Texas Leading Index, a stat that shows the trend of the state economy, rose 17 times in 19 months. This suggests that the economy is thriving. 

What Is the Cost of Living in Texas? 

The cost of living in Dallas, Texas, is four percent higher than the national average, according to PayScale. Many factors are considered before determining the cost of living, such as location, typical home prices, average wages, career opportunities, medical care costs, and miscellaneous expenses. 

According to PayScale, the housing and utility expenses of Texas are three percent and ten percent higher than the national average, respectively. However, the cost of groceries is two percent lower and transportation expenses are ten percent lower. Keep in mind that Dallas is one of the largest cities in Texas, and the annual cost of living will vary greatly depending on what city you live in. 

How Is Cost of Living Calculated?

Cost of living is often calculated by comparing the average price of services and goods such as healthcare, housing, and food. According to the Economic Policy Institute, basic expenses include childcare, transportation, food, housing, and other necessities. This number may vary because of other factors such as family size and lifestyle.

What Contributes to Cost of Living in Texas?

Average Rent in Texas

According to RentCafe, the average monthly rent for one-bedroom apartments in Dallas is $1,568. This cost is often determined by the quality, size, and location of the apartment. Most Dallas apartments have an average size of 848 sq. feet. While the median rent price is a tick above the national average for one-bedroom rentals, the average size is below the national average.

Average Transportation Costs in Texas

Transportation costs are affordable in San Antonio. The transit bus costs around $1.30 for a one-way trip, with seven-day passes costing around $12. A monthly bus pass is approximately $38. When it comes to parking costs, the average rate is $5.50 per hour and $16 for 24 hours. Auto insurance is relatively similar with the rest of the country. 

Average Food Costs in Texas

When it comes to food prices, Texas is slightly expensive. According to reports from the US Bureau of Labor Statistics, the average cost of food in Houston is $7,323 each year. This means that households spend around $610 per month on food. This sum also depends on the family size. 

Average Healthcare Costs in Texas

Medical costs are quite expensive in Texas. According to the Health Care Cost and Utilization Report (HCCUR), the average annual healthcare cost in Texas in 2020 is $5,607 per person. This number is four percent less than the cost of healthcare in Texas in 2019. 

Average Utility Costs in Texas

The average utility costs in Texas are slightly higher than the national average. The electricity bills in Texas are some of the highest in the nation at approximately $175 per month for around 1,170 kWh. According to the US Cable & Internet Market Size and Household Spending Report for 2021, 82 percent of households spend $1,392 a year, or $116 per month, on cable and Internet. 

Other Expenses to Consider in Texas

Miscellaneous expenses can add up when considering the total cost of living in Texas. For example, movie tickets cost around $12 each, and a six-pack of Heineken costs around $10. Parking fees in Texas can be as high as $28 depending on the duration and location.

Should I Buy or Rent in Texas?

Whether you should buy or rent in Texas depends on your preferences. For one, reports show that in North Texas, the average rent price is cheaper than purchasing. According to the Texas A&M Texas Real Estate Research Center, the median price change in top cities in Texas surged exponentially in 2021. 

What Is the Average Salary in Texas? 

Data from ZipRecruiter shows that, in March 2022, the average annual salary in Texas was $52,217, more than $10,000 lower than the national average. Workers in Texas typically earn an average hourly salary of $25.10, a weekly pay of $1,004, and a monthly salary of $4,351.

Salary Comparison by City in Texas

City Average Salary
Houston $74,000
Austin $75,000
San Antonio $66,000
Dallas $74,000
Fort Worth $68,000

What Is a Good Salary?

A good salary is one that meets the standard of living in a region. It can be determined by geographical location, cost of living, income tax, property tax rates, sales tax rates, local job demand, and even job scarcity. This is why a salary can be good in one state and not a livable wage in another. 

For instance, according to Glassdoor, a biomedical engineer in El Paso can earn an average annual salary of $105,540, while someone in a different location will earn significantly less. Both salaries are considered good salaries because the cost of living can vary by state. So in the end, a good livable wage in the Lone Star State enables a worker to afford basic needs.

Can You Afford the Average Cost of Living in Texas?

If you make at least $56,536 per year, you should be able to afford the cost of living in Texas. However, your expenditures will be restricted to paying bills, and additional expenses will have to be limited. This is largely due to the high healthcare and housing costs in the Lone Star State.

Generally, the biggest cost of living in Texas is still more affordable than in states like California. Compared to other states like Mississippi and Arkansas, Texas is quite expensive to live in. The biggest challenge is the high cost of housing. While it is expensive to rent, it is also costly to buy a house.

Cost of Living in Texas FAQ

Is it expensive to live in Texas?

Yes, it can be expensive to live in Texas. The cost of living in Texas is slightly higher than the national average. However, it is quite affordable in aspects like utilities, gas prices, food, and transportation costs. Costs for healthcare and health insurance are higher than in several other states. The median rent in Texas is much cheaper than buying a house because the average home price is higher than the national average.

How much does it cost to live comfortably in Texas?

To live comfortably in a major city, one would need to make at least $80,000. This would allow a person to have some money available for additional expenses after basic expenditures have been met. The cost of living index is high in Texas.

Why is rent so high in Texas?

Texas is a fast-growing state with a high employment rate. This has naturally attracted more people, and as more move in, the demand for rental properties increases, eventually surpassing the supply and pushing prices higher.

Is Texas safe to live in?

Texas is considered a relatively safe state to live in. Most of its larger cities rank lower than many others in violent crimes and theft. The suburbs and towns have a reduced crime rate and are much safer to live in.

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