What is the cheapest place in america to live

What are the cheapest states to live in? If this question has crossed your mind, you aren’t alone. Given the country’s increasing home prices, high interest rates and rising inflation, it’s no surprise that many Americans are looking to leave expensive, overpriced cities in search of more affordable places to live. In fact, during the pandemic, thousands upon thousands of Americans left expensive states to move to areas with a lower cost of living – namely, the southern and western portions of the country.

Of course, by “cheaper,” we mean a state with a below-average cost of living, including lower than average transportation, grocery, healthcare and utility costs. We’re also referring to places with below-average home prices. 

So, where in America do your dollars go the furthest? The cheapest states to live in all feature exceptionally affordable homes and an overall low cost-of-living index score. They’re also all located in the South and Midwest regions of the U.S.

According to the latest research by the Council for Community & Economic Research (as recorded by the Missouri Economic Research and Information Center), the most affordable place to live is Mississippi, which currently has the lowest cost of living of any U.S. state. 

Below, we’ve included the top 10 cheapest states to live in, as well as Census data and real estate prices to back it up.

1. Mississippi

   If you’re looking for the cheapest state to live in, head to Mississippi. With an exceptionally low cost-of-living index score of 83.3, Mississippi is well below the national average of 100. In addition to being extremely affordable, Mississippi offers plenty of warm weather and outdoor recreational activities for newcomers. 
   Overall cost of living index score: 83.3
   Median household income: $46,511
   Per capita income: $25,444
   Median gross rent: $789 a month
   Median value of owner-occupied home: $125,500
   Median home prices in popular cities: Jackson ($139,900), Gulfport ($215,000), Hattiesburg ($225,000), Biloxi ($240,000), Olive Branch ($350,000).

2. Kansas

   Thanks to its extremely low home prices and comparatively low grocery costs and transportation expenses, Kansas is a very affordable place to live. The state also offers more than just prairies and farmland. Newcomers will find plenty of culture, family-friendly cities and excellent schools. 
   Overall cost of living index score: 86.5
   Median household income: $61,091
   Per capita income: $32,798
   Median gross rent: $863 a month
   Median value of owner-occupied home: $157,600
   Median home prices in popular cities: Kansas City ($185,000), Overland Park ($400,000), Wichita ($195,000), Olathe ($379,000).

3. Alabama

   Those looking for an affordable place to live with plenty of warm weather, Southern hospitality and tasty cuisine will find it in Alabama. The southeastern state offers exceptionally cheap home prices and healthcare costs. It’s also home to well-known schools – Auburn University and the University of Alabama.
   Overall cost of living index score: 87.9
   Median household income: $52,035
   Per capita income: $28,934
   Median gross rent: $811 a month
   Median value of owner-occupied home: $149,600
   Median home prices in popular cities: Birmingham ($169,900), Huntsville ($315,000), Montgomery ($159,950), Mobile ($210,230), Gulf Shores ($339,130).

4. Oklahoma

   The fourth cheapest state to live in is Oklahoma. Not only is Oklahoma exceptionally affordable (i.e. super low home prices), but it’s also a great place to live. The state’s healthy economy, the abundance of job opportunities and friendly residents are more reasons to move to Oklahoma. The state also offers a wide range of cities to live in. Whether it’s big-city living in Oklahoma City you want or small-town life in Guthrie, you’ll find it in Oklahoma.
   Overall cost of living index score: 87.9
   Median household income: $53,840
   Per capita income: $29,873
   Median gross rent: $818 a month
   Median value of owner-occupied home: $142,400
   Median home prices in popular cities: Oklahoma City ($265,000), Tulsa ($225,000), Norman ($264,900), Broken Arrow ($279,500), Edmond ($392,340).

5. Georgia

   Given Georgia’s exceptional affordability, it’s no wonder the Peach State happens to be one of the most popular places to move to right now. Georgia’s low home prices, strong job market and family-friendly cities and towns are just a few reasons why residents love their state. The state also happens to have several well-known cities to call home, including Atlanta and Savannah.  
   Overall cost of living index score: 88.8
   Median household income: $61,224
   Per capita income: $32,427
   Median gross rent: $1,042 a month
   Median value of owner-occupied home: $190,200
   Median home prices in popular cities: Atlanta ($412,000), Savannah ($315,750), Augusta ($215,000), Columbus ($185,000), Macon ($175,000).

6. Tennessee

   Tennessee’s exceptionally low home prices, healthcare costs and transportation costs make it one of the cheapest places to live in America. In addition, the state’s lack of state income tax is a big draw for anyone looking to save money without having to lift a finger. Tennessee’s mild weather, family-friendly activities and highly rated schools also make it a great place for families.
   Overall cost of living index score: 89.0
   Median household income: $58,833
   Per capita income: $30,869
   Median gross rent: $897 a month
   Median value of owner-occupied home: $177,600
   Median home prices in popular cities: Nashville ($448,500), Memphis ($180,000), Knoxville ($349,000), Chattanooga ($299,900), Franklin ($827,500).

7. Missouri

   Whether you’re looking for affordable big-city living or a low-cost small-town life, you’ll find it in Missouri. The state is one of the overall cheapest places to live in the U.S. The Midwestern state is also home to a healthy economy, plenty of job opportunities and some of the tastiest fare in the country.
   Overall cost of living index score: 89.8
   Median household income: $57,290
   Per capita income: $31,839
   Median gross rent: $843 a month
   Median value of owner-occupied home: $163,600
   Median home prices in popular cities: Kansas City ($235,000), Springfield ($214,900), Jefferson City ($190,000), Columbia ($289,900), Branson ($259,900).

8. Iowa

   Iowa is one of the cheapest states to live in – but also one of the best. The state’s friendly residents, thriving job market and gorgeous outdoor surroundings make it an exceptionally great place to call home. The state’s education is also second to none. According to Only In Your State, Iowa boasts the highest literacy rate and the highest graduation rate in the U.S.   
   Overall cost of living index score: 89.9
   Median household income: $61,836
   Per capita income: $33,021
   Median gross rent: $806 a month
   Median value of owner-occupied home: $153,900
   Median home prices in popular cities: Des Moines ($195,000), Cedar Rapids ($173,900), Davenport ($169,900), Sioux City ($189,950), Iowa City ($307,500)

9. West Virginia

   There’s no denying that West Virginia is one of the most affordable states to live in. It’s also a great place to find an abundance of outdoor activities to enjoy. Known for its stunning mountain views, fall foliage and incredible hikes, West Virginia is an outdoor enthusiast’s dream come true. 
   Overall cost of living index score: 90.5
   Median household income: $48,037
   Per capita income: $27,346
   Median gross rent: $732 a month
   Median value of owner-occupied home: $123,000
   Median home prices in popular cities: Bridgeport ($289,450), Morgantown ($285,000), Charleston ($179,500), Fairmont ($182,430), Wheeling ($149,900)

10. Indiana

    If the Midwest is calling your name, consider a move to Indiana. Affordable home prices and exceptionally low grocery costs aren’t the only reasons to move to Indiana. The Hoosier State is also home to some of the most livable cities in the country. Top-rated schools and a strong economy are two more reasons why you’ll love living here.
    Overall cost of living index score: 90.6
    Median household income: $58,235
    Per capita income: $30,693
    Median gross rent: $844 a month
    Median value of owner-occupied home: $148,900
    Median home prices in popular cities: Indianapolis ($229,000), Fort Wayne ($195,000), Evansville ($160,000), South Bend ($159,900), Bloomington ($304,500).

7 things to consider when looking for an affordable state to live in

The cost of living isn’t the only thing you should consider when moving to a new state. From affordability to quality of life, here are seven things you should consider before making a move. 

1. Taxes

   If you’re looking to live somewhere more affordable, it’s always a good idea to consider taxes. Moving to a place with low (or no) taxes will save you a bundle of money every year. For reference, the U.S. states with no state income tax are Alaska, Florida, Nevada, South Dakota, Texas, Tennessee, Washington and Wyoming. In addition, New Hampshire does not tax earned income – however, it does tax income from interest and dividends. Read more information about U.S. states with the lowest taxes.

2. Job prospects

   While moving somewhere cheap might be tempting, you should also consider your job prospects in that location. Unless you work remotely, you may have to take a pay cut when moving to a cheaper city or state. That’s because the average income tends to be lower in more affordable parts of the country. Of course, keep in mind that a lower salary may be fine in a place with a lower cost of living. However, you may not find the employment opportunities as abundant as you would in a more affluent location.

3. Schools

   If you have school-age children, you will need to consider the schools. Since a large part of the funding for public schools comes from property taxes, you may find that less expensive areas have less funding for schools. Even if you do not have children, homebuyers should be aware that property values are often heavily affected by the quality of the nearby schools. When looking at real estate in a cheap state, be sure to consider school ratings in the area.

4. Demographics

   Looking to move somewhere with like-minded people? Be sure to consider who lives in the area you’re looking to move to. For instance, families with young children will most likely want to move to a family-friendly city with good schools, low crime rates, a younger population and plenty of kid-friendly activities. Young professionals may want to consider moving somewhere with other young professionals, large companies and job opportunities. Older retirees, on the other hand, may not need to worry about any of the above factors. Instead, they may want to move somewhere with an older population and plenty of recreational opportunities.

5. Local housing market

   When looking for an affordable place to live, be sure to consider the local housing market. In addition to pricing, you’ll need to assess the typical square footage, age and features of homes in the area. If you prefer to rent, does the city offer many rental options? In many parts of the country, quality rentals are few and far between. If you’re looking to purchase real estate, you should also consider the comps. Just because you’re moving somewhere affordable doesn’t mean you should pay the asking price for a home.

6. Recreational activities

   Before moving somewhere new, it’s important to consider everything there is to see and do in a new city. For instance, if a city’s recreational activities are centered around the great outdoors, but you aren’t the outdoorsy type, then perhaps it’s not the city for you. Keep in mind that some cities are considered more family-friendly than others. If you’re moving with kids, you should consider what activities, parks, events and camps are offered in the area. Living in a city that offers the recreational activities you enjoy doing will go a long way in making your move a happy one.

7. Overall culture

   Moving somewhere cheap that doesn’t offer the overall culture you’re looking for probably isn’t a great idea. We recommend researching the area and talking to residents to determine if a city’s culture is a good fit for you. From politics and religion to values and traditions, there are many different parts that encompass the umbrella term “culture.” It’s also a good idea to consider the cultural events that a city offers. From festivals to museums, make sure the place has the cultural offerings you’re looking for.

Ready to move to one of these affordable states?

To explore more cities within these states, check out our City Profile Report feature. Our reports include city demographics, real estate information, quality-of-life factors and more. Simply enter the zip code or the state and city of your potential move to get a free report at the click of a button. For those ready to move, our extensive network of reputable and reliable movers makes it easy to book the best moving company for the job. All relocation companies in our network are licensed and insured, so you can rest assured that your move will be in good hands. Best of luck and happy moving!

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