Navigating the economic landscape of the United States can often feel like a daunting task, especially when it comes to finding a state that aligns with your financial expectations. But fret not! We've done the heavy lifting for you. Using comprehensive 2022 economic data, we've compiled a list of the top 10 states with the lowest cost of living in the U.S. This list takes into account several vital factors such as housing costs, average income, utility expenses, and the cost of goods and services. The aim is to present a clearer picture of where your dollar stretches the furthest, offering a balanced perspective on affordability relative to earnings. Read on to discover which states made the cut and could potentially be your next affordable home.
Top 10 States With The Lowest Cost Of Living
Mississippi: An Affordable Gem in the Heart of the South
Mississippi, known for its rich history, warm hospitality, and mouthwatering southern cuisine, is not only the state with the lowest cost of living in the U.S., but it also offers an affordable lifestyle that can be a particularly appealing place to live for families, retirees, and anyone looking to stretch their dollar further. With a cost of living index score of 83.312, Mississippi is the perfect place to call home.
One of the most attractive aspects of Mississippi's low cost of living is housing. The average home price in the state is $172,654, significantly below the national average. Whether you're dreaming of a charming home in a quiet, rural setting or a trendy apartment in a bustling city like Jackson or Gulfport, Mississippi's housing market is likely to have something to fit your budget.
But affordable housing isn't the only financial advantage of living in Mississippi. The state's median household income is $45,792, and while this is lower than in some other states, it goes further in Mississippi due to the lower cost of daily essentials like groceries, transportation, and healthcare. Plus, Mississippi's tax burden is one of the lowest in the nation, leaving more money in residents' pockets.
Despite a slightly higher unemployment rate of 5.8% in Mississippi, there are abundant job opportunities in industries like manufacturing, agriculture, and healthcare. The state also actively attracts new businesses, which may lead to further job growth. Mississippi's temperate climate offers mild winters, hot summers, and picturesque landscapes with forests, rivers, and stunning Gulf Coast beaches. It provides an appealing combination of affordable living, economic opportunities, low housing costs, and delightful southern culture. It's definitely worth considering for your next move.
Oklahoma: Unveiling the Affordability of the Sooner State
If affordability is a priority in your search for a new home, then Oklahoma, with its second-lowest cost of living index score of 85.83, should be on your radar. Known for its diverse landscapes, ranging from the Great Plains to forested hills, Oklahoma offers more than just natural beauty—it's a state where your dollar goes further.
Housing is a significant factor in Oklahoma's affordability. The median home value is an attractive $142,800, making homeownership a realistic goal for many. Whether you're searching for a cozy bungalow in a small town like Stillwater or an apartment in the vibrant city of Oklahoma City, there are options to suit varying budgets and lifestyles.
In addition to affordable housing, the cost of daily essentials in Oklahoma, such as groceries, healthcare, and utilities, is also lower compared to other states. This, coupled with a median household income of $52,919, allows residents to maintain a comfortable lifestyle without breaking the bank. What's more, Oklahoma's tax burden is one of the lowest in the country, providing further savings.
The job market in Oklahoma is robust, with the lowest unemployment rate on this list with a mere 3.2%. The state's economy is diverse, with industries like energy, agriculture, and aerospace offering ample employment opportunities. Future job growth is also projected to be positive, thanks to the state's efforts to attract new businesses.
Oklahoma's climate, with hot summers and mild winters, is perfect for outdoor enthusiasts. The state boasts a rich cultural heritage, including Native American and Western-themed museums, music festivals, and sporting events. Oklahoma offers an affordable, high-quality life with a thriving job market and diverse recreational opportunities. It's an excellent choice for anyone considering a move.
Kansas: Discover Affordability in the Heart of America
Kansas, historically known as the “Sunflower State,” is not only a natural beauty with its sprawling plains and sunflower fields, but it also ranks as the third cheapest state to live in the USA. With a score of 86.44, Kansas offers an attractive combination of affordability and quality of life.
Housing is what makes Kansasa on of the cheapest places to live. The median home value in the state stands at $165,200, well below the national average. This makes homeownership within reach for many, whether you're looking to settle in larger cities like Wichita or Topeka or prefer the charm of smaller towns such as Dodge City or Emporia.
Beyond housing, the cost of daily essentials, including groceries, health care, and transportation, is lower in Kansas compared to the national average. Pair this with a median household income of $59,597, and it becomes clear why many find their money stretches further in Kansas.
The state boasts a robust job market, evidenced by an unemployment rate of just 3.5%. Key industries in Kansas include agriculture, aerospace, and manufacturing, offering diverse employment opportunities. Moreover, Kansas's overall cost of living is nearly 8.74% less than the rest of the US, making it a particularly attractive option for professionals and families alike.
Kansas's climate features distinct seasons, with hot summers and cold winters, ideal for those who appreciate seasonal change. The state is also rich in cultural heritage, from its Native American history to its pivotal role in the American Civil War.
Alabama: An Affordable Treasure in the Deep South
Alabama, known as the "Heart of Dixie," is not only rich in history and culture but also stands out as one of the most affordable states in the United States. Alabama ranks as the fourth cheapest state to live in with an index score of 87.5.
One of the key contributors to Alabama's affordability is its housing market. The median home value in Alabama is an inviting $157,800, significantly lower than the national average. Whether you're looking for a quaint cottage in a charming town like Fairhope or a modern condo in the vibrant city of Birmingham, Alabama offers diverse housing options to suit different budgets and lifestyles.
The cost of daily essentials such as groceries, healthcare, and transportation is also usually lower in Alabama, which further enhances the state's affordability. This, paired with a median household income of $51,734, means residents can enjoy a comfortable lifestyle without stretching their budgets.
With a mere 3.3% unemployment rate, Alabama boasts a thriving job market. The state's economy encompasses a diverse range of industries, including aerospace, education, healthcare, and manufacturing, offering abundant employment prospects.
Alabama's climate, featuring gentle winters and hot, humid summers, is a haven for outdoor enthusiasts. From venturing along the captivating Gulf Coast beaches to embarking on invigorating hikes in the Appalachian Mountains, there's an abundance of activities to engage in throughout the state.
To summarize, Alabama's enticing attributes, such as its affordable living costs, flourishing job market, and recreational opportunities, make it an attractive choice for individuals contemplating relocation. The state's southern charm, storied history, and warm hospitality further augment the appeal of this budget-friendly destination.
Arkansas: Enjoy Southern Comfort at an Affordable Cost
Arkansas, affectionately known as "The Natural State," offers a unique blend of affordability, natural beauty, and southern charm that makes it stand out among states with low cost of living. From the vibrant city life in Little Rock to the tranquil beauty of the Ozark Mountains, Arkansas provides a diverse range of lifestyle options.
A significant contributor to Arkansas's affordability is its housing market. In Arkansas, the state with the least expensive housing cost, the median home value is remarkably low at $133,300, making homeownership a realizable dream for many. Whether you're looking for a modern apartment in Fayetteville or a country house in the serene town of Hot Springs, Arkansas has a wide range of affordable housing options.
In addition to affordable housing, the cost of daily essentials such as groceries, healthcare, and transportation in Arkansas is also lower than the national average. This, coupled with a median household income of $48,952, allows residents to maintain a comfortable lifestyle without breaking the bank.
Arkansas also boasts a healthy job market, with an unemployment rate of 3.7%. Key industries in the state include agriculture, manufacturing, and healthcare, offering diverse employment opportunities.
The state's climate features mild winters and hot, humid summers, perfect for those who enjoy outdoor activities. From hiking in the Ouachita National Forest to fishing in the Mississippi River, there's always something to do in Arkansas.
Missouri: Experience Midwestern Charm at an Affordable Cost
Known as the "Show-Me State," Missouri is a hidden gem in the heartland of America, offering an appealing blend of affordability, cultural richness, and natural beauty. With a cost of living that is significantly lower than the national average, Missouri is an attractive option for those seeking a more affordable lifestyle.
A defining factor in Missouri's affordability is its housing market. The median home value in the state is a very manageable $169,400. Whether it's the bustling city life of Kansas City or St. Louis or the serene landscapes of the Ozark Mountains, Missouri offers a variety of housing options to meet diverse needs and budgets.
In addition to affordable housing, the cost of daily essentials such as groceries, healthcare, and transportation are also lower in Missouri than the national average. With a median household income of $57,409, residents can enjoy a comfortable lifestyle without the high price tag often associated with other states.
Missouri also offers a robust job market, as indicated by an unemployment rate of just 3.9%. Key industries in the state include manufacturing, healthcare, and agriculture, providing a wide range of employment opportunities.
The state's climate features four distinct seasons, making it ideal for those who appreciate a changing landscape throughout the year. From exploring the Lake of the Ozarks to tasting world-class barbecue in Kansas City, there's always something to do in Missouri.
Michigan: Affordable Living in the Great Lakes State
Michigan, known as the "Great Lakes State," is not only rich in natural beauty and cultural heritage but also offers a cost of living lower than the national average. From the vibrant city life in Detroit to the scenic tranquility of the Upper Peninsula, Michigan provides a diverse range of lifestyle options.
A key factor in Michigan's affordability is its housing market. The median home value in the state is a reasonable $169,600, significantly lower than many other states. Whether you're seeking an urban loft in Grand Rapids or a lakeside retreat in Traverse City, Michigan's housing market offers something for everyone.
Beyond housing, the cost of daily essentials such as groceries, healthcare, and transportation in Michigan also tends to be lower than the national average. With a median household income of $59,584, residents can enjoy a comfortable lifestyle without excessive financial strain.
Despite a slightly higher unemployment rate of 5.0%, Michigan's job market is diverse with sectors such as automotive manufacturing, healthcare, and technology offering a variety of opportunities.
The state's climate features all four seasons, ranging from warm summers perfect for exploring the state's numerous lakes and beaches, to snowy winters that transform the state into a winter wonderland.
Tennessee: Experience Southern Charm on a Budget
Tennessee, fondly known as the "Volunteer State," is not only renowned for its rich history, music scene, and southern hospitality but also for its low average cost of living, particularly in rural areas. From the vibrant city life in Nashville to the peaceful tranquility of the Smoky Mountains, Tennessee offers a lifestyle that caters to a wide range of preferences.
One of the key factors contributing to Tennessee's affordability is its housing market. The median home value in the state stands at an attractive $191,900, considerably lower than many other states. This means whether you're searching for a chic loft in downtown Memphis or a cozy cabin in Gatlinburg, there's a good chance you'll find something that fits your budget.
In addition to affordable housing, the cost of daily essentials like groceries, healthcare, and transportation are also lower in Tennessee than the national average. With a median household income of $56,071, residents can maintain a comfortable lifestyle without stretching their finances too thin.
Despite an unemployment rate of 4.9%, Tennessee's job market is diverse, with sectors such as healthcare, manufacturing, and entertainment offering a variety of opportunities.
The state's climate is characterized by hot summers and mild winters, making it ideal for those who enjoy outdoor activities. From hiking in the Great Smoky Mountains National Park to river rafting in the Ocoee River, there's always something to do in Tennessee.
Georgia: Southern Hospitality Meets Affordable Living
Known for its rich history, diverse culture, and beautiful landscapes, Georgia is also recognized for being the most expensive state of our 10 least expensive states, especially outside the bustling city of Atlanta. From charming coastal cities like Savannah to the serene mountain towns in the Blue Ridge Mountains, Georgia offers a variety of lifestyle choices that cater to different preferences and budgets.
A key contributor to Georgia's affordability is its housing market. The median home value in the state is a modest $202,500, making homeownership a feasible goal for many. Whether you're drawn to the suburban communities around Atlanta or prefer the slower pace of rural towns, there's a home for you in Georgia.
Beyond housing, the cost of essentials such as groceries, healthcare, and transportation are generally lower in Georgia than the national average. With a median household income of $58,700, Georgians can enjoy a comfortable lifestyle without breaking the bank.
While the unemployment rate stands at 4.5%, Georgia's job market is diverse and robust. Key industries include film and television production, technology, and agriculture, providing ample employment opportunities.
As for climate, Georgia is known for its warm, humid summers and mild winters, making it perfect for outdoor enthusiasts. The state's rich history, vibrant music scene, and famous southern cuisine add to its appeal.
Indiana: Midwest Revival
Indiana, known for its affordable living conditions and vibrant culture, is a state that often gets overlooked when people consider relocation. With a cost of living index score of 88.8, it's significantly lower than the national average, making it an attractive option for those seeking to stretch their dollar further.
Housing is one of the largest factors in the cost of living. In Indiana, the median home value stands at an attractive $172,300, which is considerably lower compared to many other states. This makes homeownership a more attainable goal for many families and individuals residing here.
In terms of income, the median household income in Indiana is $57,603. While this might seem modest compared to some states with higher costs of living, it's worth noting that the dollar stretches further here due to the lower living expenses, making the income more than sufficient for a comfortable lifestyle.
The unemployment rate in Indiana is relatively low at 4.1%, indicating a healthy job market. This is particularly encouraging for those looking to move here, as it suggests a good range of employment opportunities across various sectors.
Beyond the economic aspects, Indiana also offers a pleasant climate with distinct seasons and a variety of recreational and cultural activities. All these factors combined make Indiana not just an affordable state to live in, but also a place with a high quality of life. Whether you're a young professional, a growing family, or looking to retire, Indiana offers something for everyone.
Ready To Make A Move?
In conclusion, the search for a state that offers a low cost of living without compromising on quality can seem like a daunting task. However, armed with the right information, it becomes a much more manageable endeavor. The 10 states listed in this blog post represent some of the most affordable places to live in the United States, as determined by 2022 economic data. They offer a balance of affordable housing, reasonable utility costs, and fair prices for goods and services, all relative to average income. While the 'perfect' place to live will always be subjective and dependent on individual needs, these states provide a great starting point for anyone looking to stretch their dollar further.