Financial freedom
isn’t free.
The Cost of Life
The cost of life is the amount of money that is needed to cover your basic expenses such as housing, food, transportation, taxes, and healthcare. The cost of life is also tied to your household wages and the number of individuals living in your household. Your cost of life could also be higher if you live in an area such as New York compared to an area such as Nashville.
Housing
Housing is without a doubt the biggest cost of living expense. In 2021, if you are buying a home within Tennessee, the average price to buy a home will average around $170,800. That’s well below the U.S. average of $334,000 for new homes and $260,000 for previously owned properties.
However, you must remember, this average is accounting for home sales across urban and rural areas of Tennessee.
Food
As you may have already read the cost to feed a child from birth to 18 years of age (at an average of $2.00 per meal) is $40,000.00
But what about an entire family? The good news is if you are buying groceries in Tennessee you will typically spend well below the national average. According to MIT’s Living Wage Calculator, a single adult in Tennessee spends an average of $2,990 per year on food. For a family of four, the cost of food jumps to about $8,820.
Utilities
The expense of water, sewer, and to heat or cool your home is one of the costs of life where living in Tennessee is actually more expensive than the national average. Reports from the U.S. Energy Information Administration show that the average monthly energy bill in Tennessee is around $123.30. This is $12.00 more per month than the national average.
This does not include the added expense of having internet in your home. The average unlimited internet plan is around $68.00 per month.
Transporation
The average American family spends almost $10,000 per year for transportation. The bulk of this expense is on car payments or leases and the remainder is spent on fuel, tires, insurance, and general automobile maintenance.
Although this expense did decrease during 2020 due to the impact of COVID, it has steadily increased since the spring of 2021. With the increase cost of fuel and other items tied to transportation, this cost is believed to rise to over 11,500 by 2023.
Retirement
If you live in or plan on retiring in Tennessee I have good news for you. You will be retiring in the 41st most affordable state to spend your golden years. However, if you retire in Tennessee at age 65, then your life expectancy is an additional 18 years. This means you will need an estimated $937,660.00 to live on which is nearly $183,000 less than the average nationwide.
If your current assets, 401k, other retirement accounts, or investments are not on target to reach this amount, then the importance of life insurance plays even a larger role in protecting your loved one(s) future.
You’re Future is Worth It
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