In comparison to other states, the cost of living in Louisiana is far better – largely because of lower taxes, lower than usual costs for essential goods and, ahem, significantly cheaper average auto insurance rates than the rest of the country, according to 24/7 Wall St. website.
Actually, the website’s analysis upset several old saws, like New Orleans workers should be paid more because it cost more to live there and that Louisiana workers groan under tax burden far in excess of the national average. Neither are accurate when the data from 2018 and 2019 was consulted by the website's analysts.
Insurance companies and the business community used a constant drumbeat of too high auto insurance rates to press Louisiana legislators last year and this until a new law was signed that reduces an individual’s ability to pursue grievances against corporations in court. While true that some drivers do pay more, sometimes significantly more than national average for the insurance required to drive, the website noted Louisiana drivers pay on average about 35% less than the rest of the country.
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Of course, different coverages have different prices, but when all the available packages are averaged out, Louisiana drivers do pretty well, according to Insurance.com whose comparison prices the 24/7 Wall St website – and Louisiana legislators last year – relied.
“In Louisiana, the average car insurance premium is $985, less than the $1,517 national average, according to data from Insure.com,” the website stated.
The findings came up to support an analysis called “The Value of a Dollar in Every State.” Turns out that a dollar goes further in Louisiana than in Texas, but not quite as far as it goes in Arkansas and Mississippi, according to the 24/7 Wall St. website.
Based in New York City, 24/7 Wall St. provides economic calculations – sometimes serious, sometimes off-beat – for financial analysts and media organizations, including MSN MarketWatch and USA Today. For instance, 24/7 Wall St. calculated a traditional Thanksgiving meal cost about $6 in 1947. But the same turkey, sides, sauces, drinks, and desserts cost nearly $50 in 2020.
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Louisiana closely trails Texas in personal income per capita, income adjusted cost of living, and median home value, but is far ahead of its neighbors and Alabama. Texas also has three metropolitan areas, each with more people than the whole of Louisiana.
Purchasing Power Parity, called PPP, is how economists compare how well individuals are doing financially in places that operate under different economic circumstances. Generally, PPP calculates how much of an individual’s income is paid for the same goods and services.
The website postulated that, as a general rule of thumb, rural areas are less costly than urbanized regions. Prices for groceries, utilities, and other goods and services in relatively poor states – such as Louisiana, Mississippi, Arkansas, and Alabama – tend to be lower than the nation as a whole. But values and costs of homes also tend to be lower, as well.
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The most expensive region in the state is the New Orleans metro area, where the cost of goods and services is 5.9% lower than the national average and 5.0% higher than the statewide average, according to the website. Workers in and around the Crescent City make more than their colleagues in other parts of the state – often on the argument that it’s more costly to live in and around New Orleans. But that logic is flawed, the website indicates, because St. Charles and St. Tammany parishes are the one, two most expensive in the state. East Baton Rouge, Jefferson, Lafayette, and Orleans parishes are roughly the same, requiring an average of $75,000 a year for a family of four to pay their expenses.
Accounting for state and federal income taxes, as well as Social Security contributions and Medicare payroll, the average adult working in Louisiana pays $5,772 annually in taxes – about 12% below the national average of $6,542, according to 24/7 Wall St.
The Dollar’s Purchasing Power along the Gulf Coast
- State Dollar Personal Cost of Median Home
- Value Income Living Value
- Arkansas $1.17 $43,292 $47,158 $133,100
- Alabama $1.16 $42,240 $45,397 $147,900
- Mississippi $1.16 $37,904 $40,927 $123,300
- Louisiana $1.12 $46,245 $48,178 $167,300
- Texas $1.03 $50,483 $48,443 $186,000
- Florida $0.99 $50,199 $46,346 $230,600
Source: 24/7 Wall St. website