If you're looking for a good balance of outdoor access along with big-city amenities like lively sports and arts scenes, Indiana is a fantastic place to live. This Midwestern state is known for its friendly residents, idyllic agrarian countryside and love for basketball and car racing. Major cities like Indianapolis and Fort Wayne have vibrant arts and culture offerings, dining, sports and booming industries like manufacturing. National and state parks full of hiking and mountain biking trails are close to big cities.
One of Indiana's biggest assets is its cost of living. Even in major cities like the capital of Indianapolis, the cost of living is affordable. Some are more expensive than others, but the general cost of living in all major Indiana metro areas is below the national average. There are variations in the cost of goods or other costs of living categories like utilities by city, though. This article breaks down the cost of living in major cities across the state. With this information, you make informed decisions about the best place to live in Indiana for your budget and lifestyle.
- Housing costs
- Food prices
- Utility costs
- Transportation costs
- Healthcare costs
- Goods and services costs
- Tax rates
- How much do you need to earn to live in Indiana?
Indiana housing prices
Indiana's cost of living for housing varies widely from city to city. But overall, they're right at or below the national average. Many actually fall far below the national average. This means that housing-wise, living in Indiana is extremely affordable. And a big city in Indiana does not directly translate to higher housing costs. Even hip cities like Fort Wayne boast extremely low housing costs. You can easily find affordable, budget-friendly rental options in the heart of major cities.
Here's an overview of the average cost of rent in several of Indiana biggest's metropolitan areas.
Bloomington is Indiana's premier college town, being the home of the prestigious Indiana University, Bloomington. Despite being a small city, it boasts of a vibrant cultural and social scene typical of college towns. Indianapolis is also only an hour's drive northeast.
Affordability is another key feature of college towns. But Bloomington's is on the rise. The average cost for a one-bedroom apartment is $985. While this is an attractively low figure, it's up 15 percent from last year. Two-bedroom apartments are up 13 percent from the previous year, averaging $1,197. Bloomington's housing costs are exactly the same as the national average.
The average cost of buying a home in Bloomington is also on the rise. The median home price has risen 19.6 percent since last year to $305,000.
Heading to the extreme southern end of Indiana brings us to the mid-sized city of Evansville. Located along the Ohio River, Evansville sits right next to the border with Kentucky. Surrounded by forests and wetlands, locals have easy access to the great outdoors. The city is home to several universities and has noted museums and an active sports scene.
As a far-flung college town that's nearly three hours by car from Indianapolis, housing costs here are on the low side. One-bedroom apartments cost an average of $767 per month, up 5 percent from last year. Two-bedroom apartments are slightly more expensive at $966. This is an increase of 13 percent from the previous year. Overall, though, housing costs in Evansville are 29 percent below the national average.
The cost of buying a home here is similarly affordable. It's also dropped 1.5 percent from last year. The median home price is a budget-friendly $128,000.
If you want to save on housing without sacrificing the big-city lifestyle, Fort Wayne is the place to go. This mid-sized city in the northeastern part of the state has a budding culinary scene, abundant parks and urban green areas and plenty of museums and cultural institutions. As a city on the rise, more people are discovering Fort Wayne's charms. But that's also driving up the cost of living, especially for housing.
Housing costs in Fort Wayne are 34 percent below the national average. While that may look good at first glance, rental rates are going up. A one-bedroom apartment costs an average of $1,078 per month, while a two-bedroom averages $1,317. But these prices are major jumps from the year before. Rates have risen 20 percent and 30 percent for one- and two-bedroom apartment rentals, respectively.
Data about the Fort Wayne housing market is patchy but suggests a competitive market. The median listing price is $190,000. Recent home sales have ranged anywhere from the low $200,000s to mid $500,000.
You can make your N.Y.C. or California friends green with envy over the average rent prices in Indiana's capital city. Even in the city center, you'll find hip, affordable neighborhoods. The average cost for a one-bedroom apartment is $1,077, up 5 percent from last year. A two-bedroom apartment runs an average of $1,200, which is only up 6 percent from 2021.
The overall housing costs in Indianapolis are 20 percent lower than the national average, as well. You can easily find a spacious, well-appointed apartment for a fair price. There are plenty of cheap Indianapolis neighborhoods to choose from.
Hopeful homeowners will also find respite from the booming and competitive housing market here. The median home price around Indianapolis is $246,125. This is up 19.6 percent from last year, however. So, home prices may not stay affordable long.
The average apartment cost in this small city in the central west part of the state is the lowest of the five highlighted cities. You can snag a one-bedroom apartment for a mere $607 per month, up 12 percent from last year. Two-bedroom apartments are a reasonable $705 and have dropped 1 percent from 2021. The cost of three-bedroom apartments has dropped 14 percent to $845 if you want even more space.
The overall housing costs here are 23 percent lower than the national average. So, if you're seeking affordable housing close to Indianapolis, Terre Haute is a great option. The capital is only an hour away, and Terre Haute also has good parks, schools and universities.
If you're looking to buy a home in the Terre Haute area, prices are going up. The average cost of a home here has jumped 28.9 percent since last year to $116,000. While rates are going up, that also makes it the most affordable homebuyer's market of our five highlighted cities.
Indiana food prices
When it comes to groceries and food, Indiana residents pay 8 percent less than the nationwide average. It's the 4th lowest state for food costs. The food cost per person averages between $2,400 to $2,800 annually. On a city-by-city basis, the cost of groceries varies from nearly 10 percent to less than one percent. To break it down by city:
- Fort Wayne is 0.8 percent below the national average
- Bloomington is 3.4 percent below the national average
- Indianapolis is 5 percent below the national average
- Evansville is 7.4 percent below the national average
- Terre Haute is 9.4 percent below the national average
Just because one city has the lowest overall grocery prices doesn't mean it has the lowest prices per item. Even in less expensive cities, certain items can cost more. For example, a dozen eggs cost $1.75 in Terre Haute, which has the lowest food prices. But in Indianapolis, they're $1.66. In Fort Wayne, the average price for a half-gallon of milk is $2.78. In Evansville, it's $1.76.
The great restaurant scenes in cities like Indianapolis and Fort Wayne also impact food prices. Dining out at a nicer restaurant for a three-course meal in Indianapolis will cost around $75 for two people. In Terre Haute, the same kind of meal will be around $65.
Indiana utility prices
Utilities are one of the few Indiana cost of living categories that regularly exceeds the national average. Three out of the five Indiana cities highlighted are over the national average. Evansville tops the charts for being the highest above the nationwide average for utilities.
- Fort Wayne is 1.7 percent below the national average
- Bloomington is 2.9 percent above the national average
- Indianapolis is 4.9 percent above the national average
- Evansville is 7.2 percent above the national average
- Terre Haute is 7.7 percent below the national average
There's a reason that utility costs are so much higher in Evansville as opposed to a larger city like Indianapolis. CenterPoint Energy is the primary electric and natural gas provider to the area. They've recently come under fire for their high prices. The company says the higher prices are due to the cost and scarcity of natural gas. Evansville residents can expect to pay around $197 for their total energy costs. In comparison, Bloomington residents will pay an average of $183.71 for their energy. Terre Haute residents have the best deal, shelling out around $159.73 for their energy.
Indiana transportation prices
With gas prices around Indiana climbing higher, having access to mass transit to save money is more important than ever. Most cities in Indiana offer some form of mass transit. For the most part, buses are the primary option for getting around town. But some cities also have historic trolleys that residents and tourists can use to get around.
Most major highways and interstates around the state are also free with the exception of the Indiana Toll Road. Stretching 156 miles from the Illinois state line to the Ohio state line, costs on this tolled freeway vary depending on the duration of use. Driving it from start to end costs $11.70. Drivers can pay in cash or get an E-Z Pass.
Using mass transit is a great way to save money on gas, parking and other costs related to transportation. With a few exceptions, the cost of living for transportation in Indiana cities is below the national average.
- Evansville is 4.5 percent below the national average
- Fort Wayne is 4.9 percent above the national average
- Bloomington is 6.1 percent below the national average
- Indianapolis is 7.3 percent below the national average
- Terre Haute is 20.5 percent above the national average
While the most costs of living categories in Terre Haute are below the national average, transportation is the big exception. Offering 11 different routes around town, the standard fare is $1.75. In terms of size, Indianapolis has the biggest public transit system, followed by Fort Wayne and Bloomington.
IndyGo in Indianapolis
Indianapolis residents get around town using the Indianapolis Public Transportation Corporation, otherwise known as IndyGo. Their fleet of 217 vehicles includes diesel, electric and hybrid buses. The agency operates 30 fixed routes, with 3,385 stops around town.
Instead of offering a one-way fare, the price for a ride depends on the amount of time they use the system. A two-hour ticket allowing for transfers costs $1.75. A full day costs $4. Discount and Half Fare options are available for youth under 18, people over 65 and those with disabilities. An S-Pass is also available for students.
Having affordable, far-reaching public transportation is important in Indianapolis, as the city isn't very walkable. Indianapolis only has a walk score of 37. However, it's easier to navigate by bike. The bike score is 51, and initiatives like the Pacers Bikeshare program make it easier to get around the city on a bike. This program has 50 stations around town, with hundreds of bikes to rent for $1 per bike and 15 cents per mile.
Citilink in Fort Wayne
Citilink provides public transportation services to residents of Fort Wayne and Allen County. They offer over two dozen routes, and their fleet includes hybrid-powered vehicles. The starting fare is $1.25 for a one-way pass. This doesn't include transfers, though, so frequent riders opt for the All-Day Pass, which costs $3 for adults. A 31-day pass costs $45.
Downtown Fort Wayne is very pedestrian-friendly, with a good walk score of 68. The rest of the city fares slightly worse for walkability at 44. At 48, the bike score isn't much better. So, having good and affordable mass transit is a necessity for moving around the city, especially heading outside the city center.
Connect Transit in Bloomington
Consisting of a fleet of wheelchair-accessible buses, Connect Transit is the main source of mass transit for residences of Bloomington. They offer 16 fixed routes around town, easily connecting major areas like Indiana University's main campus and downtown. A one-way ticket with free transfers between routes costs $1.25. A 30-day unlimited pass will run you $40. Connect also offers many different discounted fares and passes for everyone from students to the elderly.
While Bloomington's mass transit is very accessible and affordable, Bloomington is also a very walk-friendly city. The walk score is 59, and its bike score is 64. In a college town, being able to get around by bus, on foot or by bike is essential.
Indiana healthcare prices
Healthcare is a difficult metric to measure since it has so many variables. Personal healthcare plans, location, population age and other factors can all impact prices. If you're seeking generally affordable healthcare, Indiana is a good option. In most major metropolitan areas, the cost of healthcare is below or just above the national average. Indianapolis is home to nationally-ranked hospitals, giving residents excellent access to top-tier healthcare.
- Fort Wayne is 1.1 percent above the national average
- Bloomington is 3.1 percent below the national average
- Evansville is 6.4 percent below the national average
- Indianapolis is 11.2 percent below the national average
- Terre Haute is 12.4 percent below the national average
Here's the average cost a person living in these cities can expect to pay for a doctor's visit:
- Bloomington: $93.50
- Indianapolis: $96.77
- Evansville: $107.21
- Terre Haute: $123.00
- Fort Wayne: $137.00
Thanks to prestigious university hospitals and medical programs, cities like Indianapolis and Bloomington enjoy lower prices. Overall, the average annual cost of healthcare in the entire state is $6,618 per person.
Indiana goods and services prices
Of all the cost of living categories, goods and services are the most nebulous. It encapsulates everything from basic items like clothing to services like getting a haircut or childcare. Even if a city's overall cost of goods and services is down, individual things may cost more than in other cities. For the most part, though, Indiana residents can expect to pay slightly less than the national average for goods and services.
- Bloomington is 0.9 percent above the national average.
- Evansville is 1.5 percent below the national average.
- Terre Haute is 1.8 percent below the national average.
- Fort Wayne is 3.6 percent below the national average.
- Indianapolis is 4.9 percent below the national average.
For example, getting a haircut in Indianapolis will cost you around $19. But in Bloomington, the price jumps to $25. If you want to go out to see a movie, the cheapest price you'll find in our highlighted cities is $10.04 in Indianapolis. The most expensive is in Evansville for $11.67.
Childcare is another costly expense many families need to budget for every month. The average cost of childcare in the U.S. is now over $10,000 a year. In Indianapolis, you can expect to shell out about that much for childcare. A month at a private preschool or kindergarten facility averages $916.67 a month. In Bloomington, it's much cheaper at $625 a month. Terre Haute offers the lowest, more affordable childcare at $450 a month.
Taxes in Indiana
The statewide sales tax is 7 percent. Individual cities or areas don't levy local sales tax, so the sales tax is the same throughout the state. That means that for every $1,000 you spend, $70 is going to taxes. But considering there are no additional sales taxes by city or county, that's pretty reasonable.
While the sales tax doesn't change, there are variations in income tax. Indiana has a pretty reasonable flat income tax rate of 3.23 percent. But different cities and counties add on their own taxes as well.
- Evansville has a combined income tax of 4.43 percent
- Bloomington has a combined income tax of 4.57 percent
- Fort Wayne has a combined income tax of 4.71 percent
- Terre Haute has a combined income tax of 5.23 percent
- Indianapolis has a combined income tax of 5.25 percent
If you're looking to pay less in income taxes, avoid living within Marion County for Indianapolis and Vigo County for Terre Haute. You'll pay the lowest income taxes living in Evansville.
How much do I need to earn to live in Indiana?
The amount of money you need to earn to live comfortably in Indiana will vary by city. Naturally, you'll need to make more to live in a big city like Indianapolis compared to a smaller city like Evansville or Terre Haute.
The cost of housing is usually the biggest chunk out of people's monthly budget. The general rule of thumb is that you shouldn't spend more than 30 percent of your gross monthly income on housing.
According to the most recent census, the median household income in Indiana is $58,235. Since the average statewide rent for a one-bedroom apartment is $1,062, you'd need to earn $3,540 a month or $42,480 a year. That falls comfortably within the median household income.
But you would have to earn more to live in a bigger city. Since the average Indianapolis one-bedroom costs $1,077, you would need $43,080 annually. You'd need to earn similar figures for Fort Wayne or Bloomington. But the lower rents in cities like Terre Haute are closer to the statewide average.
If you're trying to figure out what Indiana city fits your budget, use our rent calculator tool.
Living in Indiana
For the most part, the cost of living in Indiana is very affordable. Most aspects of living here fall below the national average, especially with housing. That gives you more money to spend on enjoying what the state has to offer, like basketball or spending time hiking around state forests.
Since cities like Fort Wayne and Indianapolis have all kinds of cosmopolitan amenities, a taste of big-city life is affordably within reach. But if you want a more laidback small city lifestyle, you'll find that, too, and for very reasonable rates. So, if you want low prices, scenic countryside and friendly neighbors, Indiana could be your home sweet home.