Maryland is a state rich in history and blessed by nature. Also known as “America in Miniature,” Maryland’s 10,460 square miles has every natural feature except a desert. Which means you can also expect floods to claim damages in the area as well as hurricanes and a lot of thunderstorms.
According to Maryland’s official state website, “Hurricanes can also produce winds in excess of 155 miles per hour, tornadoes, microbursts, heavy rain, and thunderstorms. Flooding and debris from forceful winds are often the deadly and destructive results of a hurricane,”.
And, with 16 out of 23 of its counties bordered by tidal water, it’s no wonder that Maryland is also rich in seafood, in particular its delicious blue crabs. This and many other dishes – and even beverages – typically come with that distinct Old Bay seasoning flavor that many Marylanders love.
But, the question is: Can you afford to eat those blue crabs, buy a house or rent one, and pay for all the other costs associated with living in the state? Or, in other words, is it expensive to live in Maryland? What about running a business in Maryland?
The Better Business Bureau (BBB) states, “BBB of Greater Maryland provides an ethical marketplace where buyers and sellers trust each other. We help brands get discovered, convert feedback into opportunity, earn prestige and trust, and put their integrity on display,”.
Is Maryland Expensive?
The short answer is yes. In fact, Maryland’s cost of living has been rising in recent years.
The cost-of-living index is a measurement of how much money an average person would need to cover basic expenses living in a certain location at a particular period of time. It often includes housing, groceries, taxes and other metrics. Another way of thinking about cost of living is asking yourself how far a certain amount of money would go in terms of paying off basic expenses in a particular place.
The cost of living is a good way to help you decide if it’s worth moving from where you are now to another location. Would moving increase or decrease your quality of life?
The cost of living in Maryland
According to the Baltimore Post-Examiner, the cost of living in the Old Line State is 22% higher than the national average. In particular, housing and utility are more expensive in Baltimore than the national average.
Maryland ranks seventh in terms of total cost of living, according to Forbes Advisor, with a total cost of living of $48,235. The state’s median annual salary is $73,632, according to Forbes, or $98,461, according to GOBankingRates. Either way, that still leaves more than $10,000 extra.
The bottom line: Although Maryland is among the most expensive states to live in, its living wage is among the highest in the country, so it balances out.
Housing and Rent in Maryland
Housing in Maryland is 54% higher than the national average, according to the Baltimore Post-Examiner. Average house prices range from $317,000 to $366,000, with every square foot costing $216, according to Forbes.
Mortgage payments are at $2,423 per month. If you’re renting, you will be shelling out $1,732 per month. This rate puts Maryland in the no. 6 spot for the states with the highest rental costs in the country.
Perhaps a big factor for such high home prices and rental rates is the fact that Maryland has and is close to several major metropolitan areas. It’s close to job centers like Baltimore, Annapolis and Washington, D.C., making it a highly desirable place to live in for people working in these places.
Food Costs in Maryland
In Maryland, total annual food cost is $4,260, according to Forbes Advisor. And, it seems the prices just keeps on getting higher and higher.
A Consumer Affairs report states that grocery prices in the U.S. increased 5.3% from 2022. But, in Maryland, that increase is 7%. That rate is only surpassed by Vermont and Pennsylvania at 7% and 8.2%, respectively.
Food prices are not limited to grocery items, however, as even the cost of fast food has seen a spike in the state. For instance, a Big Mac costs over $5 and the price of a Chick-fil-A Chicken Sandwich is 14% higher than the national average at $3.84.
According to a study by coupon site BravoDeal, Maryland ranks fifth in the most expensive state for the fast food category. The only other states with higher fast food prices than Maryland are California, New Jersey, New York and Hawaii.
Because of this, hunger has become an issue in the state, especially after the pandemic. “All of us throughout the state have heard from constituents,” Del. Emily Shetty, a Montgomery County Democrat, told the Baltimore Sun. “It’s not one particular district. All throughout our state, hunger is a pervasive issue.”
In fact, the Maryland Food Bank saw their distribution rise 20% from $6 million to about $25 million. More and more people are looking to the food bank for support.
“Some of the government support has gone away and then you tie that with inflation going up at the same time,” Carmen Del Guercio, the food bank’s president, told CBS Baltimore. “Many families are trying to muster their way through that but as time went on it’s harder and harder to do that.”
Taxes in Maryland
Income taxes in Maryland average $6,326 per year, according to Forbes Advisor. It ranks fifth in the country when it comes to levying the highest income taxes. Income tax rates in the state range from 2% to 5.75%.
In addition to income tax, Baltimore and Maryland’s 23 counties levy a local income tax on their residents. But, sales tax is 6% statewide, with no local equivalents.
For property taxes, it varies depending on where the property is located. The average property tax in 2021, however, was 1.05% of a home’s assessed value.
For seniors and retirees, social security benefits are tax exempt. However, IRA withdrawals are taxable. Residents 65 years or older who are disabled or who have a spouse who is disabled can deduct $36,200 from their taxable pension. In addition, they can also deduct their retirement annuity income from their federal adjusted gross income.
Costs of Childcare in Maryland
When it comes to childcare, Maryland has the highest costs in the country. One child in daycare will cost a family as much as $15,403 and $18,456 for two children annually, according to a survey by the United Way of the National Capital Area. This puts the state in the top 10 in the list of states with the highest childcare costs.
Perhaps this isn’t surprising as childcare in the region generally ranks high. For instance, Virginia ranks ninth and Washington, D.C. ranks first.
According to the report, 17% of the income of the average household will go to covering the costs of childcare for one child. For low-income households, this increases to 21%, while single parents pay 34% for childcare for one child.
Is it expensive to live in Maryland?
In conclusion, yes it is expensive to live in Maryland, in fact, the State’s cost of living has been continually rising over the last few years.