New Mexico, known as the "Land of Enchantment", is an affordable Southwest state with low housing and moderate overall costs. Here is everything you need to know about the cost of living in the Land of Enchantment — from housing and groceries to taxes, utilities, childcare, and what salary you actually need.
Here is what a typical month costs in New Mexico for a single person earning the median income of $53,000/year:
Each category shows how New Mexico compares to the national average. Green means cheaper, yellow means similar, orange/red means more expensive.
Adjust your salary to see a detailed monthly budget breakdown for living in New Mexico.
Select a state to see how much salary you would need there to maintain the same lifestyle you have in New Mexico.
The most popular cities for residents and newcomers in New Mexico:
Housing is the single biggest expense in New Mexico, as it is everywhere. The median home price in New Mexico is $285,000, and the median rent for a one-bedroom apartment is $900/month. With a housing cost index of 80, New Mexico housing is 20% cheaper than the national average.
Housing in New Mexico is a genuine advantage. The low cost of housing frees up income for savings, investments, and discretionary spending that residents of expensive states simply cannot afford.
New Mexico has a state income tax rate of 5.9%. On the median household income of $53,000, you will pay approximately $3,127/year in state income tax ($261/month). This is a moderate rate that most households can absorb.
The average single person in New Mexico spends approximately $390/month on groceries. A family of four can expect to spend $975-$1,170/month. The food cost index of 96 means groceries in New Mexico are 4% below the national average.
Gas prices in New Mexico average $3.15/gallon. For the average commuter driving 15,000 miles/year at 25 MPG, that is roughly $1,890/year in fuel costs.
New Mexico healthcare costs are 7% below the national average (index: 93). The average annual healthcare cost per person in New Mexico is approximately $5,580 including premiums and out-of-pocket expenses. Employer-sponsored health insurance covers the majority of working adults.
Infant daycare in New Mexico averages $800/month ($9,600/year). This is below the national average, making New Mexico more family-friendly from a financial perspective. Many families in New Mexico find that one parent staying home is more cost-effective when two or more children need daycare.
New Mexico offers a solid balance of cost, opportunity, and quality of life. With costs near the national average, you get access to growing job markets in Albuquerque and Las Cruces, and a cost of living that leaves room for saving and investing.
See all New Mexico financial calculators:
New Mexico (NM) has a cost of living index of 91, meaning it is 9% cheaper than the US average. Housing is the biggest factor with an index of 80. The median rent is $900/month and the median home price is $285,000. New Mexico ranks #15 out of 50 states for affordability (1 = cheapest).
For a single person, a comfortable salary in New Mexico is approximately $68,900/year ($5,742/month). For a family of four, aim for $116,600/year. This covers housing at 30% of income, groceries ($390/mo), transportation, healthcare, and a 15% savings rate. The median household income in New Mexico is $53,000.
The median rent for a one-bedroom apartment in New Mexico is approximately $900/month. A two-bedroom averages $1,215/month. Rent varies significantly by city: Albuquerque, Las Cruces, Santa Fe are the most popular metro areas. Housing in New Mexico is affordable compared to the national average.
New Mexico is an excellent choice for affordability. With a cost of living 9% below the national average and median rent of just $900/month, your money goes significantly further here. Top cities include Albuquerque, Las Cruces, Santa Fe.
The most affordable areas in New Mexico are typically smaller cities and rural areas away from the major metros. Within New Mexico, costs can vary 20-40% between the most expensive city (Albuquerque metro) and more affordable areas. Rio Rancho and Roswell tend to offer lower costs while still providing good amenities and job opportunities.
The average monthly grocery bill in New Mexico for a single person is approximately $390 ($975 for a family of four). New Mexico food costs are 4% below the national average. Shopping at Walmart, Aldi, and local discount stores can reduce this by 15-25%.
The average monthly electric bill in New Mexico is approximately $115. Total utilities (electric, gas, water, internet) average $253/month. New Mexico utilities are 5% below the national average. Utility costs are manageable for most households.
New Mexico has a state income tax rate of 5.9%. On the median household income of $53,000, that is approximately $3,127/year in state income tax. This is a moderate rate near the national average.