The True Cost of Living in Montana: Why You Need to factor in these 5 Expenses
The cost of living in Montana depends on what kind of lifestyle you’re used to in your current city and how much you’re willing to pay to maintain that life style in Montana. After living here for two years, I can say that the cost of living in Montana isn’t as cheap as we thought it would be when we first arrived. Here are five expenses that you need to factor into your budget if you plan on moving here and staying here long-term (and not just on vacation).
Taxes
Property taxes are assessed by counties, not cities. But different counties charge varying rates. For example, property tax rates can go as high as $9 per $1,000 of market value. That's higher than New York City's highest-in-the-nation $7 rate! It is most expensive in Missoula County where an average home costs about $303K and residents pay a whopping 0.97% (or about 9 cents for every dollar) just for property taxes alone! If you have an average home with an appraised value of $250K then you'll be paying about $3300 each year for property taxes alone! And if your house is worth $500K? Well that would mean around a $5000 annual bill for property taxes alone. And that doesn't include other expenses like the sales tax on cars, annual car registration fees, or income tax rates on salaries! There are many factors at play when considering the true cost of living in Montana so make sure to do your research before deciding which city will suit you best.
Property Prices
Property prices in Montana are actually pretty low. The problem is that prices for the same kind of property vary greatly across the state and because property taxes are assessed based on the value, it can be a huge expense.
Montana does not have a sales tax, so consumers don't have to worry about that. However, when you buy something there is an excise tax which goes into effect if it's sold for over $100. It's currently 6% but will increase by 1% each year until 2020 when it will max out at 7%.
Montana has a higher than average tax rate, which is a common problem in areas with low property values. There is a broad based personal income tax that starts at 4% for earned income and goes up to 6.9%. Businesses are taxed at either 2% or 3% depending on how their income is calculated. That percentage could go up if legislation changes later this year. They also charge a gas tax as well as fees related to water use and solid waste disposal - both of which are determined locally.
Montana has one thing going for it though - its lack of sales tax! That means many people find themselves saving quite a bit here - even before considering any other factors such as lower property values or cheaper electricity rates.
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Groceries
Montana is a beautiful state, with plenty of wilderness and mountains to explore. But how does the cost of living in Montana compare? The average annual salary in Montana is $46,930 according to the Bureau of Labor Statistics, which is just below the national average. However, there are many hidden expenses that might make living in Montana seem more expensive than you would expect. Groceries in particular can be a little more costly here than elsewhere.
Prices of groceries depend a lot on what you purchase. A 2011 survey found that Montanans spent an average $331.30 per month on food, compared to $381.40 per month for all U.S. households surveyed in 2012 by the U.S.
Rent
Rent in Montana is not as high as it is in other states. According to SmartAsset, the median rent for a two-bedroom apartment in Montana costs $869 per month, which ranks 18th out of the 50 states. The average monthly cost for a three-bedroom apartment costs $1,275, with the national average being $1,465. That said, rents in the state have risen at least 3% in recent years due to low vacancy rates and increasing demand. If you're looking for a more affordable option then consider living outside of Billings or Missoula where you can find an average two-bedroom apartment for as low as $636 per month. For example, if you're just passing through the area, Laurel offers a variety of rental options from studios to five-bedrooms at prices starting from $975 per month. It's also worth considering buying your own property if you are planning on staying in Montana for long periods of time; one bedroom condos start from just under $200,000 while four bedroom houses start around $300,000.
These figures were determined prior to the housing explosion of 2021-2022, in Montana.
Utilities
Montana has some of the lowest utility rates in the country. Electricity is cheap at an average cost per kilowatt hour of 7.76 cents, and natural gas is even cheaper at an average price per therm of $1.10. The downside? These low costs are based on consumption levels, which means that your energy bills might be higher if you use more than a normal amount of power. If you’re going to need to heat your home for six months out of the year, then it will make sense for you to buy fuel ahead of time or switch providers altogether.
There are no mandated broadband service packages in Montana, so consumers can sign up with any provider they choose and still get speeds comparable with those offered elsewhere. On top of this, providers can offer special deals that bring monthly prices down by as much as 50%. Residents often have access to fiber optic networks when they move here which provide high-speed internet connections over cable lines; though many people prefer satellite because it's less expensive. Regardless of your preferred provider, all Montanans are entitled to either one gigabyte (GB) download per second or 500 GB upload per second, whichever is greater. When comparing broadband options, keep in mind that internet service may not be bundled with other utilities like electricity and gas. All Montanans have the right to voice their opinion on whether or not net neutrality should exist through ballot initiatives and referendums.
Water and trash services are not necessarily provided through city utilities. Many Montanans find that it makes more sense to arrange for their own water service because prices can vary drastically between providers and many residents opt for septic systems. Trash removal is fairly cheap though, with average monthly fees ranging from $10-$15 a month. Depending on where you live, your trash may be collected weekly or once every other week. With some parts of urban areas having poor air quality, many people choose to burn natural gas instead of traditional wood-burning stoves. They’re a bit more expensive up front but they pay for themselves quickly and can help improve air quality by limiting air pollutants that are usually released when wood burns during home fires.
