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13 States With the Lowest Cost of Living

Maybe you’re curious. Maybe you want to move. Or maybe you’re just sick of paying out of your nose for housing, groceries and utilities—you know, life.

Whatever the reason, now you’re wondering, What are the cheapest states to live in? That’s a great question! Let’s take a tour of the 13 cheapest states to live in.

13 Cheapest States to Live in for 2023

Here they are, folks:

What Is Cost of Living?

Cost of living means exactly what it sounds like—the amount it costs to live somewhere! It takes all sorts of expenses into account, like housing, groceries, utilities, transportation, health care, and miscellaneous goods and services.

To find the states with the lowest cost of living, we look at the Cost of Living Index published by the Council for Community and Economic Research (C2ER). The numbers you see in this article come from that index unless otherwise noted.

Now that you know which states are the most affordable, let’s explore how each state’s cost of living, income and unemployment rate compare to the U.S. average. We’ll talk a little about each state’s culture too.

With all this info, hopefully you can get a better picture of which states might be best for you. Let’s dive in!

1. Mississippi

Mississippi is the cheapest place to live in the United States, with a cost of living 15.6% lower than the national average. 

Here’s how Mississippi’s housing prices, income and job market compare to the rest of the U.S.:




Median Home Price



Median Monthly Rent*



Median Household Income



Unemployment Rate



*Median monthly rents refer to two-bedroom apartments.

Once you arrive in Mississippi, get ready for some fantastic music and food! This state’s known for rock ’n’ roll, blues and tasty treats like fried catfish and chocolate pies.

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2. Oklahoma

Let’s head west! Oklahoma’s average cost of living is 13% lower than normal. Oklahoma’s cheapest city is Muskogee. Move there, and you can enjoy a cost of living that’s a whopping 21% below average!

So, what kind of money can you expect to earn in Oklahoma? And how much does housing cost? Let’s take a look:  




Median Home Price



Median Monthly Rent



Median Household Income



Unemployment Rate



Oh, and if you want to make it big in sports, show biz or the rodeo, you may want to make a pit stop in Oklahoma first. Famous Okies include Mickey Mantle, Brad Pitt, Carrie Underwood and Will Rogers. Plus, people in Oklahoma love celebrating their state’s Native American roots and cowboy culture.

3. Kansas

In Kansas, the cost of living is 12.7% below average. While health care and utilities cost about the same as the average U.S. city, Kansas has really cheap miscellaneous goods and services. You’ll usually pay about 10% less than normal for things like shampoo and movie tickets.

Now, let’s compare housing prices, salaries and unemployment rates in Kansas to the rest of the country:




Median Home Price



Median Monthly Rent



Median Household Income



Unemployment Rate



With low home prices, low unemployment rates and high salaries, Kansas is one of the best states to live in financially.

4. Alabama

Alabama has the fourth-lowest cost of living—about 12.1% lower than most of the U.S. The exception? Utility bills run close to the national average.

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The cheapest part of Alabama is the Anniston-Oxford area, which has a cost of living that’s 17% below the national average. Even the most expensive city, Birmingham, is still 8% below average.

See how Alabama’s housing prices, incomes and job market stack up to the rest of the U.S.:




Median Home Price



Median Monthly Rent



Median Household Income



Unemployment Rate



Alabama is known for forests, beaches and being NASA’s home base. It’s also one of America’s biggest steel pipe makers, since the soil contains limestone, iron ore and coal—the main ingredients for steel.

5. Georgia

Georgia is next up on our list. The cost of living in Georgia is 11.4% below the national average.

Atlanta drives that number down a bit, with a cost of living that’s 2% higher than average. Fortunately, the other cities on Georgia’s cost of living index range from 8% to 17% below the average U.S. city.

So, how much does housing cost in Georgia, and how much do most people make? See for yourself:




Median Home Price



Median Monthly Rent



Median Household Income



Unemployment Rate



Georgia’s average housing costs definitely aren’t cheap. But on the bright side, salaries are close to the national median. And Georgia has a lot to offer—like the Appalachian Mountains, sandy beaches along the Atlantic, beautiful architecture and Southern charm.  

6. Ohio

Up next: Ohio! Its cost of living is around 10.6% lower than average. Here’s what housing prices, the median annual salary and the job market look like:




Median Home Price



Median Monthly Rent



Median Household Income



Unemployment Rate



7. Iowa

At 10.5% below the average cost of living, Iowa is another one of the most affordable states. Even though you’ll likely pay average prices for groceries and health care, housing in Iowa is pretty darn cheap. Let’s take a look:




Median Home Price



Median Monthly Rent



Median Household Income



Unemployment Rate



More good news: Iowa has the highest yearly income out of all the cheapest states! Plus, Iowa is one of the coolest things since sliced bread. (Actually, the guy who invented sliced bread was from there.) It has state parks, museums, aquariums and random historical sites, like the place where Grant Wood painted American Gothic—you know, the couple holding the pitchfork.

8. West Virginia

West Virginia’s cost of living index looks at two cities—Morgantown and Charleston. The cost of living in those cities is 10% below average, and they’ve got the lowest median housing prices on our countdown.

If you live on the east side of West Virginia, you’re closer to Washington D.C., so your cost of living will likely go up. On the flip side, the cost of living is likely even cheaper than Morgantown in the mountains of southern and western West Virginia.

Let’s see how Charleston and Morgantown compares to the rest of the U.S.:


West Virginia


Median Home Price



Median Monthly Rent



Median Household Income



Unemployment Rate



West Virginia has a big mining industry and beautiful outdoor areas. You can hike hundreds of trails, climb mountains, and visit places like Harper’s Ferry to learn the local history.

9. Indiana

Indiana’s cost of living is 10% less than the U.S. average. Folks in Indiana also pay around average for transportation and utilities. But what about housing? And what’s up with the job market? Take a look:




Median Home Price



Median Monthly Rent



Median Household Income



Unemployment Rate



Beyond the numbers, Indiana is surprisingly beautiful. It has everything from sand dunes up north to forests and limestone caves down south. This state also grows lots of popcorn—so bring your movie collection along.

10. Arkansas

Next up, Arkansas! The cost of living in Arkansas is 9.9% below average. It’s got one of the lowest health care costs in the country—17% below average! That’s a huge win for your budget.

Now let’s check out housing prices, incomes and the job market in Arkansas compared to the rest of the U.S.:




Median Home Price



Median Monthly Rent



Median Household Income



Unemployment Rate



Arkansas has amazing natural hot springs, caves and forests. And you can live on the plains or in the mountains, just like in Missouri. But unlike Missouri—or anywhere else—you can actually find real diamonds in Arkansas at Crater of Diamonds State Park. 

11. Missouri

The cost of living in Missouri is 9.8% lower than the national average. Kansas City is the state’s most expensive place to live, but it’s still 4.5% less than most U.S. cities. The cheapest city, Joplin, has a cost of living around 18% below normal.

Here’s what housing prices, salaries and the job market look like in Missouri:




Median Home Price



Median Monthly Rent



Median Household Income



Unemployment Rate



In Missouri, there are plenty of small towns where you can put down roots. You can choose from grassy plains, farmland or the Ozark Mountains.

Missouri’s two biggest cities, St. Louis and Kansas City, have cool sights like the Gateway Arch and Women’s Leadership Fountain—but they’re also two of America’s most dangerous cities.47 So you’ll want to look for neighborhoods that are cheap and safe.

12. Tennessee

Tennessee’s cost of living is 9.6% below average. And after Mississippi, it has the second-cheapest transportation on our list.

Nashville is the most expensive city in Tennessee (shocker, we know). But living there still costs 2% less than in the average U.S. city. Want to find someplace cheaper? Head over to Knoxville, where the cost of living is about 16% lower than average.

Let’s compare Tennessee’s average housing prices, income and job market to the rest of the country:




Median Home Price



Median Monthly Rent



Median Household Income



Unemployment Rate



Housing prices are high in Tennessee (and it doesn’t help that the average household income is $10,000 lower than the national median). So before you move to Tennessee, find out exactly how much house you can afford to make sure you don’t go overboard.

Once you arrive, you can enjoy everything from the Great Smoky Mountains, to boot-scootin’ good music, to legendary Memphis barbecue. Yum!

13. Michigan

Michigan’s cost of living is 8.9% below average. Kalamazoo, a city about two hours from Detroit, is the cheapest place to live among all the states on our countdown.

Michiganders do pay above average for utilities and transportation, and car insurance is more expensive there than almost anywhere else in America. So, you’ll need a trusted insurance agent to help you get the right coverage at the right price.

Here’s how Michigan’s housing prices and job market compare nationally:




Median Home Price



Median Monthly Rent



Median Household Income



Unemployment Rate



Michigan is known for its auto industry, the Great Lakes and winter sports—Michiganders love ice fishing, skiing and hockey.

Should You Move to a State With a Lower Cost of Living?

Maybe! It depends on your situation—especially since every state has pros and cons.

The truth is, moving only based on the cost of living may not be the best idea. There are other things to consider when deciding where you should move—like whether you can earn a good salary in your field, or whether you’ll even like the state. Distance also matters. A cross-country move costs way more than a cross-state move.

That said, it’s important to live somewhere you can actually afford—so you should definitely find out if the cheapest states to live in will fit you and your family. To get started, try our free Cost of Living Calculator and compare your current city to cities in the most affordable states.

Making the Move

Maybe you’ve already made up your mind—you’re sick of sky-high prices and ready to head to greener pastures. Time to move!

The first step is to get a great real estate agent on your side, and that’s where our RamseyTrusted agents come into play. They’re top-performing agents who live and work all over the country. We call them RamseyTrusted because we trust them to take care of you.

Find a RamseyTrusted real estate agent today!


Next Steps

  • Decide which state you want to move to.
  • Interview at least three local agents we trust.
  • Choose one to help you find a home within your budget.

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About the author

Ramsey Solutions

Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books (including 12 national bestsellers) published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners. Learn More.

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