All-items parity
90.1
US = 100.0
Nebraska (NE) | All-items parity 90.1
Nebraska Cost of Living 2026
Nebraska reads 90.1 on the BEA all-items price parity for 2024, in the nation's cheapest dozen, with housing rents at 75.2 and a median home of $263,100. It is the only state served entirely by public power districts, no private electric utilities exist, and rates at 12.38 cents per kWh show it. Income tax is stepping down to a 3.99% top rate under the 2023 law and Social Security is now fully exempt. The thorn is property tax: at 1.53% effective it is the plains' heaviest, and relief has dominated state politics for a decade.
100% public power stateSocial Security exemptProperty tax 1.53% effective
Median Home
$263,100
2BR rent $1,092/mo
Median Income
$76,376
Household, Census ACS
Category breakdown
The four BEA price parities vs the nation
| Category | NE index | National avg | Difference |
|---|---|---|---|
| All items | 90.1 | 100.0 | -9.9% |
| Services: housing rents | 75.2 | 100.6 | -25.2% |
| Goods | 94.1 | 99.6 | -5.5% |
| Services: utilities | 75.6 | 98.4 | -23.2% |
| Services: other | 93.0 | 100.1 | -7.1% |
U.S. Bureau of Economic Analysis publishes these four component parities and no others. There is no federal grocery, healthcare or transportation price parity, so this table shows none. Food at home sits inside Goods; medical and transport services sit inside Services: other.
Sources: BEA Regional Price Parities by State (table SARPP), 2024 reference year, U.S. Bureau of Economic Analysis. Census ACS 2024 1-year (median income, home value), Nebraska Department of Revenue (income tax schedule), Nebraska Power Association (public power), Tax Foundation (effective property tax), EIA (electricity rates), KFF (uninsured rate).
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Pros / offsets
What works in Nebraska.
Public power keeps the lights cheap. Nebraska is the only state where every electric utility is publicly owned, power districts answer to ratepayers, not shareholders, and the result is 12.38 cent power, an average bill of $118 and a utilities parity of 75.6, deep below the national level.
Income taxes are on a legislated glide path. The 2023 reform steps the top rate down toward 3.99% year by year from the old 6.84%, Social Security became fully exempt, and the same package accelerated corporate cuts. Nebraska's income-tax trajectory now undercuts most of its neighbors.
Omaha is a quietly complete city. Five Fortune 500 headquarters (Berkshire Hathaway, Union Pacific, Mutual of Omaha among them), a celebrated zoo, a walkable Old Market and family homes in the $250,000s to $300,000s; Lincoln adds Big Ten university energy at even gentler prices.
Stability is the underrated feature. Unemployment persistently among the nation's lowest, an uninsured rate of 6.5%, and 3.0 hospitals per capita: Nebraska's economy rarely booms, and rarely breaks.
Cons / drivers
Where Nebraska costs more.
Property tax is the plains' heaviest. At 1.53% effective, the median homeowner pays roughly $3,800 a year, and agricultural landowners carry even more of the school-funding load. Successive relief packages (income-tax credits for property tax paid, levy caps) have trimmed but not solved it; it remains the state's defining tax grievance.
Winter is a budget line. Continental extremes (average lows of 34 degrees, hot summers) drive gas bills averaging $78 a month in season plus real air-conditioning loads, and hail alley keeps home and auto insurance (averaging $410) climbing.
The talent market is thin outside the two metros. Omaha and Lincoln hold most of the professional economy; specialized careers often route through bigger neighbors, and rural counties keep losing population, which concentrates services and raises drive times.
Sales tax creeps locally. The 5.5% state rate picks up city add-ons toward 7 to 7.5% in the metros; groceries, at least, are exempt.
Tax + benefit signals
Nebraska tax and access overview
State income tax
2.46-4.55%
Graduated or flat
Property tax effective
1.53%
Of assessed value, annual
Sales tax (state)
5.50%
Local can add 1-4% more
Uninsured rate
6.5%
Medicaid: expanded
Your take-home pay in Nebraska
Federal, Nebraska and any local income tax on your salary, per paycheck.
The mortgage on a $263,100 home
Monthly payment at today’s rates with Nebraska property tax (1.53%) and average home insurance.
Metro variation
State averages mask city variation.
Nebraska averages 90.1 on the BEA all-items parity, with the state's economic weight packed into its southeast corner:
Omaha metro: Corporate headquarters, insurance and rail money support the state's premium neighborhoods (Dundee, West Omaha's school districts) while the metro median stays in the $270,000s; Council Bluffs across the river is the value spillover.
Lincoln: The capital-and-university combination keeps demand steady and prices a notch under Omaha's, with the Haymarket district and Husker economics giving it more life than its size suggests.
Grand Island, Kearney and the Tri-Cities: Ag-processing and regional-hospital towns in the $200,000s, the practical middle of Nebraska's market.
The Sandhills and rural west: Vast, emptying counties where houses trade under $120,000; Scottsbluff anchors the Panhandle at similar prices. Cheapness here is isolation priced honestly.
For most movers the choice is Omaha versus Lincoln, and either undercuts comparable metros in every neighboring state except perhaps Wichita.
Frequently Asked
Nebraska cost of living, answered
Why is Nebraska the only all-public-power state?
A Depression-era political settlement: by the 1940s Nebraska had bought out or displaced every private electric utility, leaving public power districts and municipal systems that answer to local boards rather than shareholders. Rates stay near the national floor (12.38 cents per kWh, average bill $118) because there is no dividend to pay and generation leans on cheap regional coal, nuclear and growing wind. It is the single biggest reason Nebraska's utilities parity reads 75.6.
How bad is Nebraska property tax really?
It is the state's sore point: 1.53% effective, roughly $3,800 a year on the median home and much more on farmland, because schools are funded locally in a state with no mountains of commercial tax base. The legislature has responded with refundable income-tax credits for property taxes paid and levy caps, which meaningfully cut the net bill for owners who claim them; always file for the credit, many newcomers miss it.
What happened to Nebraska income tax?
The 2023 package (LB 754) put the top individual rate on annual steps from 6.84% down toward 3.99%, matched corporate cuts, and fully exempted Social Security from state tax. For a two-earner professional household the change is worth thousands a year by the end of the schedule, and it repositioned Nebraska from the high-tax plains outlier to roughly Iowa's neighborhood. Retirement account withdrawals remain taxable; military retirement is exempt.
Is Omaha a real alternative to bigger metros?
For most careers in finance, insurance, logistics and healthcare, yes: the Fortune 500 cluster and Berkshire's ecosystem support salaries that stretch absurdly against $250,000-300,000 family homes and fifteen-minute commutes. What it lacks is coastal-scale specialist depth (niche tech, biotech) and big-league amenities beyond the College World Series. The honest comparison is Kansas City or Des Moines, and Omaha holds its own on pay while matching them on cost.
What are winters and insurance like for a budget?
Plan on both: average lows of 34 degrees mean $78 average monthly gas bills concentrated in the cold months, while summer hail in one of the nation's most active corridors keeps homeowners premiums rising and auto insurance around $410. Roofs age fast here, factor replacement cycles into any purchase, and impact-resistant shingles earn premium discounts from most insurers.
Nebraska or Iowa for a cost-conscious move?
They are close cousins: both cheap-dozen states with heavy property taxes, strong coverage and stable Midwest economies. Iowa currently wins for retirees (all retirement income exempt at 55+, a slightly lower price level), while Nebraska counters with cheaper power, the Omaha job market and an income-tax glide path that ends similar to Iowa's flat rate. Working households should compare the specific metro pay on offer; retirees should run both in the /calculator with their income mix.