Cost of Living in Montgomery, Alabama in 2025

Montgomery, Alabama Cost of Living: Quick Takeaways

• Affordable Housing: Rent for a one-bedroom apartment averages $1,050 in 2025, well below the national average with median home prices around $200,000.
• Transportation Costs: Public transit fares are modest at $1.75 per ride; fuel costs approximately $3.08 per gallon.
• Utilities: Monthly utility costs total roughly $322, mainly influenced by electricity and internet expenses.
• Income and Cost Comparison: Median household income in 2025 is estimated at $56,000, with overall cost of living about 11% lower than the national average.

Montgomery, Alabama offers a cost of living that is generally lower than many U.S. cities, especially in housing and healthcare. Understanding these factors helps residents and newcomers manage their budgets effectively.

This article provides a detailed breakdown of living expenses in Montgomery in 2025, covering housing, transportation, utilities and more to give a comprehensive picture.

1. Housing Costs in Montgomery, Alabama

Housing costs remain a significant part of living expenses in Montgomery, with steady growth over recent years:

• 2010: Average rent for a 1-bedroom apartment was $700
• 2015: Increased to $800
• 2020: Rose to $900
• 2024: Reached $1,000
• 2025: Projected at $1,050

This gradual increase reflects both demand and inflationary trends but remains affordable compared to many metropolitan areas.

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2. Homeownership and Real Estate Trends in Montgomery, Alabama

Homeownership provides an alternative to renting with evolving real estate prices:

• 2010: Median home price was about $126,700
• 2015: Increased to $150,000
• 2020: Rose to $170,000
• 2024: Reached $195,000
• 2025: Expected to be $200,000

Property values have steadily appreciated, reflecting a stable housing market attractive for buyers and investors.

3. Transportation Expenses in Montgomery, Alabama

Transportation costs include public transit, fuel and vehicle upkeep:

• Public Transit: One-way fare is $1.75, with a monthly pass priced at $65.00
• Fuel Cost: Average price per gallon is $3.08
• Vehicle Maintenance: Annual cost averages $1,200

Transportation expenses may vary depending on commuting distance and vehicle usage habits.

4. Utility Costs in Montgomery, Alabama

Utilities contribute a notable monthly expense:

• Electricity: $255.88 monthly on average
• Internet: Approximately $66.33 per month
• Total Utilities: Around $322.21 monthly

These costs can fluctuate based on household size, usage and service providers.

5. Grocery and Food Expenses in Montgomery, Alabama

Montgomery residents typically spend around $364.17 monthly on groceries, a figure close to the national average.

Dining out costs include $21 for casual meals and $50 for mid-range restaurant meals.

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6. Healthcare Costs in Montgomery, Alabama

Healthcare costs encompass insurance premiums and medical expenses:

Employer-sponsored health insurance costs approximately $140.33 monthly, while silver plan coverage averages $621 monthly.

7. Educational Expenses in Montgomery, Alabama

Education costs vary by institution and level:

• Public Schools: Funded through taxes resulting in no direct tuition fee
• Private Schools: Average tuition around $10,000 annually
• Higher Education: In-state university tuition averages $6,381 per year

Families should consider these expenses when planning education budgets.

8. Entertainment and Leisure in Montgomery, Alabama

Leisure activities and entertainment costs in Montgomery include:

• Movie Tickets: About $9.93 each
• Gym Membership: Average $28.66 per month
• Mid-Range Restaurant Meal: Around $40

Annual spending on entertainment averages $2,482, complemented by personal care services and miscellaneous goods totaling nearly $1,475 combined yearly.

9. Taxes and Miscellaneous Fees in Montgomery, Alabama

Tax rates impacting residents as of 2025 include:

• State Income Tax: Ranges between 2% and 5%
• Sales Tax: Total rate is approximately 10%
• Property Tax Rate: Around 0.42%

Understanding these tax obligations is important for financial management in the area.

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10. Childcare and Family Expenses in Montgomery, Alabama

Childcare services represent a considerable expense for families:

• Daycare: Approximately $1,000 monthly
• After-School Programs: Around $300 per month
• Extracurricular Activities: Estimated $100 monthly

Budgeting for these costs is essential for households with children.

11. Clothing and Personal Care in Montgomery, Alabama

Monthly expenses include:

• Clothing: Roughly $115
• Personal Care Products and Services: Approximately $54

These costs contribute to overall personal upkeep and lifestyle.

12. Insurance Costs in Montgomery, Alabama

Insurance expenditures encompass various policies:

• Health Insurance: Average monthly premium is $621 for a silver plan
• Auto Insurance: Annual premium averages $2,364
• Homeowners Insurance: Around $1,951 annually
• Renters Insurance: Approximately $200 annually

These are essential expenses for protection and legal compliance.

13. Miscellaneous Expenses in Montgomery, Alabama

Additional annual spending includes:

• Entertainment: About $2,482
• Personal Care Services: Roughly $768
• Miscellaneous Goods and Services: Around $707

Such costs vary based on personal preferences and lifestyle.

14. Income and Salaries in Montgomery, Alabama

Median household income has increased steadily:

• 2010: Approximately $46,000
• 2015: Around $50,000
• 2020: About $55,000
• 2023: Estimated $55,687
• 2025: Projected $56,000

This reflects gradual economic growth supporting residents' financial needs.

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15. Comparison with National Averages in Montgomery, Alabama

Montgomery's cost of living compared to national averages:

• Overall: Approximately 11% lower
• Housing: About 25% less expensive
• Utilities: Roughly 15% higher
• Food: Near 1% lower
• Healthcare: Around 22% less costly
• Transportation: About 9% cheaper
• Goods and Services: Nearly 10% lower

These contrasts highlight Montgomery's affordability in key areas.

Our Methodology for Montgomery, Alabama Cost of Living Figures

Our cost of living analysis for Montgomery uses data compiled from trusted sources such as Numbeo, Bureau of Labor Statistics, Zillow and government agencies. In cases of missing exact data, we provide reasonable estimates to ensure a thorough overview.

Montgomery, Alabama Cost of Living: Conclusion

Montgomery presents an affordable living environment in 2025, particularly in housing, healthcare and transportation relative to many U.S. cities. While utilities are somewhat higher, overall expenses remain manageable.

Understanding the comprehensive breakdown of living costs helps residents and potential newcomers make informed financial decisions and plan accordingly for life in Montgomery.

By considering income trends, expenses and regional comparisons, individuals can better navigate the economic landscape of this vibrant Alabama city.

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