Indianapolis, IN Cost of Living (2026)

Indianapolis has a cost of living index of 88, about 12% below the national average. The housing index is 75. A one-bedroom apartment in Indianapolis rents for around $900 to $1,200 per month, and median home prices in the metro sit near $260,000. The median household income is approximately $58,000. The city's economy is centered on healthcare, life sciences, and manufacturing, and it has attracted investment from companies like Eli Lilly and Salesforce, which has added higher-wage employment to the mix.

A $100,000 salary in Indianapolis is worth approximately $114,000 relative to the national average. That's a meaningful real income advantage. Workers who earn national-market wages in healthcare, technology, or finance while living in Indianapolis consistently find they can save at rates that would be difficult in higher-cost cities.

Indiana has a flat state income tax of 3.05%, one of the lower rates in the Midwest. Marion County, which encompasses Indianapolis, adds a county income tax of about 2.02%, bringing the combined local and state rate to roughly 5%. That's a moderate and predictable tax burden. Property taxes in Indianapolis are comparably moderate, with effective rates typically running 0.8 to 1.2% of assessed value, among the lower ranges for Midwest metros.

Groceries in Indianapolis run below the national average, and transportation costs are also modest. The city is car-dependent, and public transit through IndyGo has limited reach, so vehicle ownership is necessary for most residents. Car insurance rates in Indiana are below the national average, reducing that recurring cost. Utility bills are moderate, with gas heating costs rising in the coldest winter months but offset by low summer cooling costs compared to Southern cities.