K31 Finding the Cheapest Places to Live in the U.S Pros as Well as Cons

Finding the Cheapest Places to Live in the U.S: Pros as Well as Cons

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The world is always evolving; some people like to say that change is the only constant. At times, these developments are gradual, occasionally the ground shifts beneath your feet so fast that your head is left spinning.

One example of the latter would be the changes in the employment landscape provoked by the coronavirus epidemic. If you were a chef or a bartender with no other marketable skills, you probably took a big financial hit and may still be struggling right now. An estimated 4 out of 5 people around the world have seen their earnings drop or disappear. Some of you reading this are probably looking for the cheapest states to live in just to make your savings and whatever money you had to borrow last longer.

The news wasn’t bad for everyone, though: workers and entrepreneurs who were quick to adjust actually came out ahead. Now, this is easier said than done for most of us. Making a major life change, like embracing a new career, starting a business, or moving hundreds of miles is rarely painless and even less so when it’s done out of necessity instead of by choice. One important lesson we should all remember from this crisis is that it’s never a bad idea to learn an additional professionally valuable skill or start a side hustle that may save your bacon when times are hard. Another crucial piece of wisdom is that a job you can do online – training, graphic design, programming, administration and bookkeeping, marketing, and many others – gives you a lot of flexibility.

remote workers have the advantage when choosing the cheapest states to live in

Why Moving to the Cheapest Places to Live Can Be a Good Idea

To illustrate, let’s say that you’re a master machinist, grade school teacher, or chemist in a town of 100,000 souls. None of these jobs can be done effectively without being on-site: if there are 1,000 potential jobs for you and 2,000 suitable candidates looking for work in the immediate area, you’re going to have a hard time finding employment. Even worse, especially in the cheapest places to live in the U.S, many people will be in the same boat and willing to work for peanuts, driving down salaries for everyone.

Now, let’s say you’re a freelance website designer. There are probably millions of these all around the world, but they’re competing for millions of jobs online, so work isn’t that hard to get. Your remuneration isn’t dependent on where you live, so moving to one of the cheapest places to live in the U.S can easily save you $500 a month (or in fact several thousand) without putting a crimp in your lifestyle.

Now, all you have to do is be responsible with this money, paying off your high-interest debt and investing it a little at a time. Our figure of $500 a month may not seem like a game-changer but amounts to $6,000 a year – invested at 5%, that becomes over sixteen grand in twenty years’ time, which is a handy sum however you slice it.

Considering moving to the cheapest places to live can therefore make a lot of sense in the following circumstances:

  • You’re not dependent on a traditional job for an income. You may be retired or semi-retired, own a business or plan to open one that can turn a profit even in the cheapest place to live in U.S.A, or be one of those remote workers mentioned above.
  • You don’t expect to work in your normal field for a while due to some shock in the industry and just want to take a different kind of job to get by for a few years.
  • You need to travel for work all the time anyway. This is the case for many consultants and technical specialists; moving to one of the cheapest cities to live in won’t affect you much as long as you’re not too far from a major airport.
  • You’re skilled in some job that’s in high demand in one of the cheapest states to live in. You won’t have to take much of a pay cut if any, and cheaper rent and food will magnify your ability to save.
  • You’re a full-time student doing your master’s or Ph.D. Assuming that you’re in a field where you can get a recognized advanced degree mainly through distance learning, your tuition may be as low as $10,000 per year (compared to about $30,000 for the regular route). If you’re willing to move to the cheapest state to live in, your living expenses needn’t be much higher than that.
move to the cheapest state to live in to save money

Reasons Not to Choose the Cheapest State to Live In

It goes without saying that packing up and moving to a state you may never have visited before is not something to undertake lightly. It’s also a fact that the financial implications aren’t the only thing to consider before making your decision.

  • All types of businesses, including many side hustles, can’t thrive everywhere. A lower cost of living usually means that your new neighbors will have a lower disposable income and less money to spend on luxuries. This is less of a concern if most of your business’s sales will be out of state or online.
  • Lower average wages also mean less tax income and less money for local public services. You may want to, for instance, research the schools in the cheapest places to live in the U.S and perhaps consider homeschooling.
  • Culture shock. Unlike when moving abroad, the food and language won’t be unrecognizable, but someone from California may feel a little out of place in Mississippi (and we say that with the greatest respect for both of those fine but very different states). You’ll need to consider the impact on any children or spouses you’ll be dragging along, too.
  • Moving costs. Moving across the country isn’t cheap and may end up eating a large chunk of the money you’ll save by choosing the cheapest state to live in, at least temporarily.
  • Many cheap places to live come with expenses that may not be obvious. In rural areas, for instance, you may have to drive more often and spend extra on gas. Living in a colder state will mean paying for heating, while services like specialized medical care may well cost more.

The Top 10 Cheapest Places to Live in the U.S

In some parts of the country, most notably New York with its glut of financial companies and Oregon and California as hubs for the tech industry, an abundance of high-paying jobs has led to an enormous cost of living. In NY city, for instance, the average taxi driver earns just under $44,000 a year; a one-bedroom apartment costs about $35,000 to rent. In Arkansas, the median wage is significantly lower at about $32,000, but you can also rent a four-bedroom house for $1,000 a month, so who do you think is really better off?

the cheapest places to live in the us are less glamorous but still comfortable
Photo by Han Kim

Of course, this really isn’t really an apples-to-apples comparison: Little Rock has far fewer sushi bars, yoga studios, and nightclubs. Depending on what’s important to you, you may well want to steer clear of the cheapest states to live in. If, however, you’re not too fussy and your personal situation doesn’t prevent you from moving, you can save a bundle every month and perhaps still keep earning at your present level.  In such a case, you’d be a fool not to look at the following cheap places to live:

#10: Indiana

Median Wage: $35,730

Unemployment Rate: 4.0%

Main Industries: Automotive, Pharmaceuticals, Industrial Machinery, Research and Development

Cost of Living Index: 90.6

Average Home Price: $161,000

Average Temperature: 52 °F

Violent Crimes per 100,000 Inhabitants: 371

The Hoosier state may be known mainly for basketball and the Indy 500, but also offers a rarely seen combination of small-town and modern living, including a thriving high-tech sector. Another point in its favor is its highly rated school systems and several excellent universities.

People moving here in search of one of the cheapest states to live in are often surprised by the Indiana climate, which features four distinct seasons ranging from balmy to snowy. This makes a variety of outdoor activities possible, but you may have trouble finding other entertainment possibilities outside of Indianapolis. That having been said, there is culture if you’re willing to look for it: Richmond, for example, has strong historical jazz roots and apartments for rent at a third to half less than the national average.

#9: Michigan

Median Wage: $37,620

Unemployment Rate: 5.2%

Main Industries: Forestry, Automotive, Aerospace, Information Technology, Mining

Cost of Living Index: 90.4

Average Home Price: $180,000

Average Temperature: 47 °F

Violent Crimes per 100,000 Inhabitants: 437

Another drawback of living in Indiana is that the landscape can get a little bland (unless you’re fascinated by cornfields). Michigan, by contrast, has over three thousand miles of coastline, making it a prime destination for those who want to flee the big city.

detroit is one of those cheap places to live you want to avoid

Speaking of big cities, Detroit does not have the reputation of being a great place to live or raise children. The economy in the rest of the state is much more diverse, though, and there are jobs available for those who seek them out (though salaries aren’t exactly awesome). If you can support yourself without relying on an employer, you can find some of the cheapest places to live in the U.S in Michigan, such as tiny Benton Harbor where half of the houses cost less than $65,000.

#8: Missouri

Median Wage: $36,040

Unemployment Rate: 4.2%

Main Industries: Aerospace, Chemicals, Food Processing, Light Manufacturing, Financial Services

Cost of Living Index: 89.75

Average Home Price: $168,000

Average Temperature: 55 °F

Violent Crimes per 100,000 Inhabitants: 495

Like most of the cheapest states to live in, Missouri offers a good balance between largish cities and countryside – when you get tired of one, the other is just a short drive away. If weekend camping trips are your thing, you’ll most certainly appreciate the profusion of rivers, lakes, and state parks Missouri has to offer.

Furthermore, the typical Missourian is indeed not far from the corn-fed, salt-of-the-earth, Mid-Western stereotype you may have heard about. The weather, unfortunately, is less than pleasant, with warm, humid summers and freezing winters. Almost every house has a storm cellar due to the frequent tornadoes in this state. If looking at the cheapest cities to live in, you may want to avoid Kansas City, Mo, especially due to the relatively high crime rate and lackluster job market. Webb City is large enough to provide all essential services (though just barely) and, until a few years ago, boasted the lowest cost of living not only in the Show-Me State but the entire country.

#7: Tennessee

Median Wage: $34,890

Unemployment Rate: 4.9%

Main Industries: Financial Services, Food Processing, Chemicals, Pharmaceuticals, Healthcare, Light Manufacturing

Cost of Living Index: 89.49

Average Home Price: $192,000

Average Temperature: 58 °F

Violent Crimes per 100,000 Inhabitants: 595

In addition to a generally low cost of living, Tennessee has no state income tax and very reasonable property rates. The weather there is mild though often humid, the scenery is amazing, and the lively local music scene, which comprises more than just country and blues, is by itself a pretty big draw for this state.

nashville isnt one of the cheapest cities to live in but has great nightlife
Photo by Luca Sartoni

The traditional center of gravity of Tennessean culture is of course Nashville. It is not, unfortunately, one of the cheapest places to live; if you insist on being in a modern and moderately large city, you’ll find Chattanooga and Memphis to be more economical. Contrariwise, salaries are significantly higher and jobs more plentiful in Nashville, especially in the medical field.

#6: Georgia

Median Wage: $35,950

Unemployment Rate: 4.8%

Main Industries: Transport, Financial Services, Healthcare, Textiles, Light Manufacturing

Cost of Living Index: 89.30

Average Home Price: $209,000

Average Temperature: 62 °F

Violent Crimes per 100,000 Inhabitants: 341

The bustling city of Atlanta, home of several Fortune 500 companies and world-class universities, dominates the Georgian economy; you’re unlikely to find cheap housing in the capital itself. The “real” Georgia isn’t Atlanta, though: if you don’t absolutely need to live in a metropolis, there are plenty of charming, cheap places to live. One of these is the college town of Statesboro, which combines numerous cultural attractions with a median household income of only $26,750 per year. Since residents don’t have much to spend, everything from real estate to fast food is inexpensive – though the poverty rate is also on the high side.

Georgia is not for everyone, though. Humid, mosquito-y, hayfever-inducing summers will be enough to put some people off living there, while traffic in and around Atlanta is sometimes enough to make one cry. This state is also in the hurricane belt and, while friendly in general, is known for its divisive politics.

#5: Arkansas

Median Wage: $31,850

Unemployment Rate: 4.5%

Main Industries: Food Processing, Light Manufacturing, Industrial Machinery, Mining

Cost of Living Index: 89.16

Average Home Price: $132,000

Average Temperature: 60 °F

Violent Crimes per 100,000 Inhabitants: 585

It’s not always easy to quantify and compare the quality of life in various places, but most residents of Arkansas will argue that their state doesn’t take a back seat to many. In addition, it boasts a strong economy and a low cost of living, including the second-lowest property prices in the U.S.A. A thriving art scene, great natural beauty, and small-town atmosphere are further points in its favor, though city-dwellers may find the lack of large shopping malls and similar amenities to be a drawback. Only nine “cities” in Arkansas have a population of over 50,000.

arkansas is one of the cheapest places to live in the us

More importantly, the Arkansas state government is actively looking for immigrants from other states, especially those with skills local companies need. They will, in fact, pay you $10,000 (and give you a bicycle for some reason) for relocating to the northwestern portion of the state. Interestingly, remote workers and self-employed individuals are also eligible for this program.

#4: Alabama

Median Wage: $33,740

Unemployment Rate: 4.0%

Main Industries: Steel, Automotive, Industrial Machinery, Aerospace, Information Technology, Mining

Cost of Living Index: 88.80

Average Home Price: $161,000

Average Temperature: 63 °F

Violent Crimes per 100,000 Inhabitants: 511

Given the choice, most people wouldn’t say no to living near a beach they can use year-round. Fishing and swimming fit in perfectly with this state’s relaxed approach to life, which belies the rapid growth the high-tech sector in Montgomery and Birmingham has experienced in recent years. Birmingham, in case you were wondering, has more green space per resident than any other American city; its Red Mountain Park is almost half again as big as New York’s Central Park.

Statewide, rents are about 22% cheaper than the national average and homeownership is a realistic goal for anyone making a decent income. On the downside, Alabama remains one of the most impoverished states, which is reflected in problems like drug addiction. You’ll also have to keep an eye on the news during hurricane and tornado season and, if you can’t stand the sight of bugs, you’ll definitely want to look into the cheapest places to live in the U.S’s colder regions.

#3: Oklahoma

Median Wage: $34,560

Unemployment Rate: 4.4%

Main Industries: Oil and Gas, Food Processing, Aerospace, Electronics

Cost of Living Index: 88.09

Average Home Price: $134,000

Average Temperature: 60 °F

Violent Crimes per 100,000 Inhabitants: 432

Nobody has ever called Oklahoma “The Scenery State”, nor is anyone likely to start. Aside from being flat as a pool table, it does have a number of things going for it such as being one of the cheapest places to live in the U.S. Assuming that you’re careful about how, where, and for what you shop, you can rent or buy a house here for as little as half the national average.

oklahoma city is one of the most uncluttered cheapest cities to live in

This perk has to be weighed against the weather: Oklahoma summers are sweltering and tornado warnings are a fact of life. The number of toll roads will probably come as a surprise to you, too, but at least gridlocked traffic is almost unknown even in Oklahoma City. Overall, the cost of living in this state is an impressive 24% lower than the U.S average, which may be enough of a reason to start cheering for the Sooners.

#2: Kansas

Median Wage: $35,950

Unemployment Rate: 3.2%

Main Industries: Food Processing, Aerospace, Industrial Machinery, Light Manufacturing, Chemicals, Mining

Cost of Living Index: 86.67

Average Home Price: $155,000

Average Temperature: 55 °F

Violent Crimes per 100,000 Inhabitants: 411

Though inhabitants of almost every other state on this list will disagree, Kansans claim the honor of having invented authentic barbecue. We’re not going to referee that argument, but we can tell you that the Sunflower State may be just the place for a family looking to get ahead financially. Specifically, it combines a very attractive cost of living with a thriving and diversified economy, allowing you to save a surplus.

Like with many of the cheapest states to live in, extreme weather is a concern: Kansas is the state with the second most tornadoes. High winds are common, too. As long as you can avoid Dorothy’s fate in The Wizard of Oz, however, you should enjoy making this your home.

Kansas is big, so it’s worth thinking carefully about where you want to settle. One option that’s fairly centrally located is Salina, 90 miles north of Wichita and 180 from KC. Attractive to entrepreneurs and workers alike, housing costs around 35% less than the national average and groceries are 15% cheaper, even though salaries are fairly competitive.

#1: Mississippi

Median Wage: $30,580

Unemployment Rate: 6.3%

Main Industries: Automotive, Fishing, Light Manufacturing, Forestry

Cost of Living Index: 84.10

Average Home Price: $127,000

Average Temperature: 64 °F

Violent Crimes per 100,000 Inhabitants: 278

Plenty of states claim to be the friendliest, but Mississippi can back this up with statistics: though not especially wealthy, they’re some of the most enthusiastic contributors to charity. Most of this state of 3 million people is rural in nature, with plenty of unspoiled wilderness to explore, though you can also choose to live in Jackson, Hattiesburg, Biloxi, or Gulfport – some of the cheapest cities to live in nationwide.

What you may not know is that Mississippi houses over 50 institutions of higher learning, many of which charge relatively little for tuition. In terms of education up to high school level, however, Mississippi has one of the worst-ranked education systems. Perhaps due to this, as well as Mississippians’ general resistance to change, the local economy isn’t the strongest and offers few opportunities. The weather, particularly the steamy summers and occasional hurricane or tornado, is another drawback.

mississippi is the cheapest state to live in

In Search of Cheap Places to Live

Which of these cheapest cities to live in you choose depends on many factors: what kinds of jobs are available in each, what type of weather you can stand, what infrastructure you need, and even what kind of culture you feel most comfortable with. It’s also worth remembering that the Cost of Living Index is only an approximation of an average. Your particular spending habits will determine how much you can save by moving to any of the cheapest states to live in. If you insist on fresh vegetables year-round, for instance, Alaska is not a good bet; nor is Texas’s combination of expensive electricity and high temperatures going to work for you if you hate to sweat.

Both in the cheapest states to live in and more generally, you can often save money just by ditching the city in favor of a slower pace of life. You can even try less common housing arrangements like living in an RV, at least for a short period of time. Your goal will always be to cut down on your inescapable monthly expenses while maintaining your earning power: maximizing this differential is a great way to get out of debt, put away some money, or achieve financial independence that much sooner.




    29 thoughts on “Finding the Cheapest Places to Live in the U.S: Pros as Well as Cons

    1. Brock says:

      The rents for the apartments are really huge. In this crisis most of us are forced to find cheaper solutions.

    2. Loren says:

      I work as a freelancer from home so the only necessity is to have a stable internet connection. So, I can travel and live wherever I want

    3. Mirela says:

      Living in some of those states that are less expensive for living means that you will earn less than usual. This is not an option for me.

    4. Johnatan B says:

      With the pandemic we were all thinking about changing our usual habits and save more money. Lot of people lost their jobs and stayed without income. If you are not fan of living in a big city, small towns are better choice for living cheaper.

    5. Tracy says:

      I like Georgia. Maybe I should consider living there if life there is cheaper.

    6. Lea B says:

      If you are working from home than it is easy to choose where you will live. But if you need to go to work than you have to live near your workplace to avoid commuting and additional expenses.

    7. Miroslava says:

      I was thinking about moving somewhere where the life will be cheaper. Maybe I should consider some of the states mentioned

    8. Conrad Danew says:

      Some of the states are offering incentives for moving to the state in order to gain work labour for the industries needed.

    9. Milica says:

      I can move only in one of the states with hot climate. I hate cold

    10. Lenard Coen says:

      You can change states if you have work.

    11. Grace L says:

      Detroit was a nice place to live till couple of decades ago. Now it is hard to find a job and to pay rent and all the bills.

    12. Rezaam says:

      New York is one of the most expensive places but however I will not change it. I like living in New York and I am used to

    13. Marlene says:

      Florida is also considered as one of the most expensive states. But you can find good paid job there and cope with the expenses

    14. Constantin says:

      If you have a good paying job it is not important where you live. Then you can choose a place that you like

    15. Ryan Lensdale says:

      If you are web developer and working online you can earn a good income which means that you have not to find a cheapest place to live

    16. Harvey says:

      We were considering moving to another state but when you have kids it is a bit problematic. When you are alone you can do whatever you want

    17. Marcelo says:

      I come from Alabama and now I live in California. Although the life here is a lot more expensive, I will never go back there to live

    18. Quentin says:

      During the corona virus we all have some problems coping with some of the expenses. We had all think at some point to move somewhere where expenses are not that high. But it means starting a new life and adjusting to new things that is not always as easy as it looks like

    19. Stenley says:

      A couple of years ago I get bored of living in a big town and being in a busy life, so we moved to another state in a small town. I never regrated that decision

    20. Liam says:

      After retirement which will happen in two years I plan to move to a cheaper state and buy a house there. With the money that I will get it will be very difficult to pay all the bills, so this is one way to save and to get rest from the busy and stressful life

    21. Timothy says:

      I am working online and I tend to travel a lot. During the pandemic I was unable to travel and had to stay at home in New York where I live. However I plan to change the state of residence for a calmer life and small town where the rent expenses are not so high

    22. Sean says:

      My moto is that if you can save on some expenses than you should do it. But I think that moving to a cheaper state won’t pay off in a long run because you will earn less.

    23. Teodor says:

      I like the article, thank you Promoney

    24. Pierce says:

      I started a business in a small town couple of years ago. Even it is difficult from time to time I am happy with my decision and I stayed out of living in a big town.

    25. Lawrence says:

      Very nice article, but I think that we all live where we are used to and where we have jobs

    26. Bond says:

      We live in one of the small wheel houses. We live in different states fo almost a decade and we usually only stay for 2 years at the same place. This is the best option for us and we can easily find work and support ourselves and explore the country

    27. Goranza says:

      I live with a couple of roommates in the same apartment and we share the expenses. But even like that it is very difficult to cover all the expenses when you are not having a stable job.

    28. Roberta says:

      If you decide on moving it is better to do it when not having a family and kids.

    29. Moses says:

      I live in Oklahoma and really life is cheaper here considering some other states. It is a nice place to live.

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