Chicago vs Phoenix: cost of living compared
Phoenix is 14% cheaper than Chicago overall. State income tax tops out around 2.5% in AZ vs 4.95% in IL.
Indexes use a US average of 100: below 100 is cheaper than the national average. Housing and transportation are derived from median home prices, rents and commute times; figures come from BLS, Census ACS, Numbeo and the MIT Living Wage Calculator.
The big picture
Overall, the cost of living in Chicago is noticeably higher than in Phoenix. While some individual expenses might be similar or even lower in Chicago, the cumulative effect of various categories makes it a more expensive place to reside. This difference is driven by several factors across housing, transportation, and everyday necessities, making Phoenix a more budget-friendly option for many considering a move.
Housing
When it comes to housing, there's a notable difference. Buying a home in Chicago typically requires a smaller initial investment compared to Phoenix. However, renting a one-bedroom apartment in Chicago is generally more expensive than in Phoenix. Chicago's housing stock often includes older, more established properties, while Phoenix features a greater proportion of newer constructions, particularly in sprawling suburban areas.
Taxes and everyday costs
Daily expenses vary significantly. State income taxes are considerably higher in Illinois than in Arizona, impacting take-home pay. Transportation costs are higher in Chicago, reflecting its dense urban environment and public transit options, while Phoenix's transportation costs are closer to the national average. Food and healthcare expenses are generally higher in Chicago, though utilities, particularly for cooling, can be more substantial in Phoenix's warmer climate.
Lifestyle trade-offs
Beyond costs, the lifestyle offers distinct contrasts. Chicago experiences four distinct seasons, including cold winters, and boasts a robust public transportation system, making car-free living feasible for many. Phoenix enjoys a desert climate with abundant sunshine and very hot summers, where personal vehicles are often essential for getting around. Chicago is a dense, historic city, while Phoenix is a more spread-out, newer metropolitan area.
Bottom line
Moving between Chicago and Phoenix presents a clear financial shift. A household budget will likely stretch further in Phoenix due to its lower overall cost of living, particularly with lower state income taxes and generally more affordable daily expenses. However, the initial cost of purchasing a home is typically higher in Phoenix, and utility costs for cooling can be substantial during its long, hot summers. Renters, conversely, may find Chicago's rental market more demanding.
| Measure | Chicago, IL | Phoenix, AZ |
|---|---|---|
| Overall cost of living (US avg = 100) | 118 | 102 |
| Housing index | 97 | 105 |
| Transportation index | 121 | 100 |
| Food index | 105 | 96 |
| Healthcare index | 108 | 98 |
| Utilities index | 102 | 112 |
| Misc index | 108 | 92 |
| Median home price | $318,000 | $388,000 |
| Median 1-bedroom rent | $1,650/mo | $1,450/mo |
| Average commute | 34 min | 28 min |
Compare any two metros with the free cost of living tool, or see the true monthly cost of a specific Phoenix home with the True Cost Calculator.