Cost of Living in North America – What are the cheapest places to live?

North America living

We’re going to take a look at the cost of living in North America, as of 2023. First, we’ll compare living costs in the USA with those in Canada and Mexico. There is also a deeper dive into the most expensive and cheapest places to live in North America which includes living costs in a number of capitals and other major cities in Central America.

For the indexes below, data from Numbeo and has been used as a guide to help create them. However our estimates for the cost of living in North America per month are more designed to be a useful means of comparison than an accurate prediction of what you might spend which will depend massively on your lifestyle and other factors. The figures are loosely designed to cover the cost of rented accommodation and typical living costs such as groceries, transport and other essential items for one person.

Table of Contents

What are the cheapest places to live in North America?

Living in Mexico City.
Mexico City – more affordable than all major cities in the USA and Canada.

Cost of Living in North America in 2023 – Country Comparison (USA, Canada, Mexico)

CountryNorth America Cost of Living Index ($US/Month)

The above table is based on the average living costs in 10 major cities in each country. For the USA and Canada, we have simply chosen the 10 largest by population while for Mexico, it is 10 of the 14 largest with sufficiently reliable data unavailable for some of the others.

As you can pretty clearly see, the USA has the highest cost of living in North America with major cities there on average 28% more expensive than those in Canada and 150% more expensive than those in Mexico.

Indeed, compared to almost every other country in the world, the USA is very expensive to live in. The current strength of the US Dollar relative to other major currencies will also make it seem incredibly expensive for foreigners moving to the States, particularly those without a job lined up. There are certainly much better options for digital nomads and anyone hoping to work remotely.

Canada is also a very expensive country to live in. Living costs there, according to our indexes, are still more than three times as high as some of the cheapest countries to live in South America such as Argentina and Colombia. Mexico is also more expensive than those countries with its costs more in line with the most expensive South American nations such as Brazil, Chile and Uruguay.

USA vs Mexico vs Canada Living Costs
USD Monthly Cost of Living (2023) comparison for North American countries.

To find the outright lowest cost of living in North America, you’ll certainly need to look to one of the other countries in the wider region. There are some very affordable options for living in Central America and the Caribbean.

While reliable data is a bit harder to come by for smaller towns and cities in those countries, the next section ought to offer a broad overview of living costs across the North American continent.

What are the most expensive & cheapest cities to live in North America?

CityCountryCost of Living Index ($US/Month)
New YorkUSA3600
Los AngelesUSA2800
Mexico CityMexico1200
Panama CityPanama1150
San JoseCosta Rica1050
Santo DomingoDominican Republic1000
Guatemala CityGuatemala900
Belize CityBelize900
San SalvadorEl Salvador900
San Pedro SulaHonduras850
Santiago de los CaballerosDominican Republic700
Villa NuevaGuatemala650

We’ve used the same sources and methods for the North America city cost of living index above, this time also including all cities of over 500,000 people in Central America and the Caribbean, as well as selected capitals and other major cities. Data from some of those cities may be less reliable so it’s worth doing more extensive research into costs before making serious plans to move to one. We have also featured the five largest cities in the USA, Canada and Mexico.

Unsurprisingly, US and Canadian cities are by some distance the most expensive. New York is the city with the highest cost of living in North America. There are also a host of US cities with living costs higher than Los Angeles (2nd in the table above) such as San Francisco and Seattle.

North of the border, the likes of Vancouver and Toronto also rank amongst the most expensive places to live in North America and there’s a pretty significant drop before you get to the most expensive North American cities outside of the US and Canada.

Toronto Skyline
Toronto is one of North America’s most expensive places to live.

There are some smaller towns that are seen as safer and more desirable places to live in Mexico with higher costs than Mexico City which ranks 11th in the table above. However there are a whole host of Mexican and Central American cities which offer significantly lower living costs with it quite possible to get by on well under $1000 per month in the likes of Guatemala, Nicaragua and Honduras.

Nicaragua is the cheapest country in mainland North America with its capital Managua registered at just $600/month according to the index. However, the troubled Caribbean nation of Haiti is even cheaper and the cheapest place to live in North America overall.

Carrefour, located on the fringes of the Haitian capital Port-au-Prince, is one of the cheapest cities to live in North America of those with a population of 500,000 or more as of 2023. However you can find even lower living costs in smaller towns and in provincial regions of Haiti and some of the cheapest countries to live in Central America.

Factors to consider when budgeting for life in North America

  • Fixed Employment vs Remote Working

Finding the best place to live in North America will largely depend on your work situation. Retirees or those able to work remotely will see their money go much further in Mexico, Central America or cheaper parts of the Caribbean. There may be real potential to save money for digital nomads who decide to base themselves in somewhere like Nicaragua or maybe Guatemala for a few months. However those seeking a permanent, location-based role may find Canada or the United States offers the best value for money and savings potential given how low salaries are in other parts of North America.

  • The Best & Safest Places in Central America are rarely the big cities

In the table in the previous section, we only featured the larger cities where more data was available but in truth many of those are not at all desirable places to live. There are much nicer and safer places in Guatemala than Guatemala City for example while the Nicaraguan capital Managua is another that certainly doesn’t rank amongst the best places to live in the region with major safety issues. Basing yourself in a smaller town in Central America can potentially prove cost effective and offer a higher quality of life on many different levels. Even in the cases where costs are slightly higher than in the big cities, as is the case in some of the smaller coastal settlements in Costa Rica for example, living in a safer place may be well worth the additional expense.

  • Currencies

These are pretty uncertain economic times and some currencies do fluctuate quite a lot. While Panama, El Salvador and several of the smaller Caribbean islands use the US Dollar, most countries in the region have their own currency. Any big swings in their valuation can have a significant knock-on effect in terms of costs and your potential to save money if you’re working and earning in the local currency.

New York, USA
Living in NYC – not cheap!
  • Healthcare Costs

Healthcare is a big headache in much of North America including the United States where it is notoriously expensive and often inaccessible for those without the suitable insurance packages. In poorer countries in the region, the standard of healthcare is often quite limited and private clinics with better facilities can be very expensive. We haven’t included healthcare costs or cover in the indexes featured above as this will very much depend on your age and individual circumstances. You can get a quote in less than a minute from SafetyWing who specialise in global travel medical insurance for nomads.

  • Visas & Residence Permits

Another potential additional cost may be that of a work visa or residence permit which again will depend very much on your circumstances and which country you are hoping to live in, assuming it is not your own. Canada and some Caribbean countries are relatively easy to immigrate to provided you have the required skills or in some cases proof of funds. However a US Green Card for example may set you back more than $1000 and the legal path to migrating to some other countries, particularly if you’re seeking permanent residency, can be expensive.

This look at the cost of living across North America was published in June 2023.

Cost of Living in North America – What are the cheapest places to live?

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