10 Cheapest Cities to Live in When You’re on a Budget

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Whether you’re heading to graduate school, taking a new job, or hoping to live somewhere new, it’s important to take a city’s cost of living into consideration.

That said, the cheapest cities to live in based on cost of living aren’t always the best places to live. In many cases, income levels are low and poverty rates are high.

We ran the numbers on 253 urban areas across the United States to find the 10 cheapest cities to live in today. We looked at median incomes, housing costs, unemployment rates, and poverty levels to give you a full picture.

Following our initial list, we also ranked cities by major expense categories, including groceries, housing, and transportation, to demonstrate that you don’t have to live in one of the nation’s cheapest cities to enjoy an affordable cost of living.

On the map below, you can see where the 10 cheapest cities to live in are located.

10 cheapest cities to live in

Based on data from the Council for Community and Economic Research (C2ER) in the second quarter of 2017, we ranked the 10 cheapest cities to live in based on a cost-of-living index score for each urban area. That score is compared with a national average benchmark of 100.

For added context, we also included population, income, and poverty data from the U.S. Census Bureau, unemployment rates from various sources, median home listing prices from Zillow, and median monthly rent costs from Trulia. Plus, we broke down cost of living into different categories, including housing, groceries, utilities, and health care.

Note that although we’re talking about cities, the data includes the overall urban area, so some might be represented by a county or two cities rather than one city.

10. Memphis, Tennessee

cheapest cities to live in

Image credit: Wikimedia

  • Cost-of-living index: 17.2 percent below the national average
  • City population: 652,717
  • Median household income: $36,975 (U.S. median: $55,322)
  • Median home listing price: $88,704 (U.S. median: $259,900)
  • Median monthly rent: $895
  • Housing costs: 35.4 percent below the national average
  • Unemployment rate: 3.9 percent (U.S. average: 4.1 percent)
  • Poverty rate: 27.6 percent (U.S. average: 12.7 percent)
  • Groceries: 8 percent below the national average
  • Utilities: 2 percent above the national average
  • Transportation: 13.1 percent below the national average
  • Health care: 13.8 percent below the national average

Rich in history and culture, Memphis is the largest city on our list in terms of population. It’s also the only city on our list where the cost of utilities is higher than the national average.

The biggest reason for the city’s low cost of living is its housing costs, which are 35.4 percent below the national average. Despite below-average costs, however, the median household income in Memphis is 33.2 percent below the national median.

Bottom line: The Bluff City has rock-bottom housing prices and a below-average unemployment rate, but more than 1 in 4 residents live in poverty.

9. Martinsville-Henry County, Virginia

cheapest city to live in

Image credit: Wikimedia

  • Cost-of-living index: 17.6 percent below the national average
  • City population: 13,445
  • Median household income: $31,719 (U.S. median: $55,322)
  • Median home listing price: $99,000 (U.S. median: $259,900)
  • Median monthly rent: $875
  • Housing costs: 27.5 percent below the national average
  • Unemployment rate: 6.8 percent (U.S. average: 4.1 percent)
  • Poverty rate: 24.1 percent (U.S. average: 12.7 percent)
  • Groceries: 7.6 percent below the national average
  • Utilities: 10.9 percent below the national average
  • Transportation: 21.2 percent below the national average
  • Health care: 11.3 percent below the national average

The smallest city on the list in terms of population, Martinsville-Henry County enjoys low housing costs and the second-lowest transportation costs in the country.

That said, it also has the highest unemployment rate among cities on our list, and just under a quarter of its residents are living below the poverty line.

Bottom line: Martinsville-Henry County’s median household income is 42.7 percent below the national median, making it hard for residents to enjoy the city’s low cost of living.

8. Knoxville, Tennessee

cheapest cities to live in

Image credit: Wikimedia

  • Cost-of-living index: 17.8 percent below the national average
  • City population: 183,239
  • Median household income: $34,556 (U.S. median: $55,322)
  • Median home listing price: $209,900 (U.S. median: $259,900)
  • Median monthly rent: $1,200
  • Housing costs: 29.4 percent below the national average
  • Unemployment rate: 3.1 percent (U.S. average: 4.1 percent)
  • Poverty rate: 26.5 percent (U.S. average: 12.7 percent)
  • Groceries: 13.2 percent below the national average
  • Utilities: 10.1 percent below the national average
  • Transportation: 15.3 percent below the national average
  • Health care: 11.6 percent below the national average

Home to the University of Tennessee, Knoxville enjoys low costs across the board. It also ties Conway, Arkansas, for the lowest unemployment rate on our list.

The median household income, however, can make life difficult for residents, especially the 26.5 percent who live in poverty.

Bottom line: You likely won’t have trouble finding a job in Knoxville, but the pay might make it difficult to cover all your basic expenses.

7. Kalamazoo, Michigan

cheapest city to live in

Image credit: Wikimedia

  • Cost-of-living index: 19.5 percent below the national average
  • City population: 75,984
  • Median household income: $34,767 (U.S. median: $55,322)
  • Median home value (in lieu of listing price): $96,700 (U.S. median: $259,900)
  • Median monthly rent: $1,100
  • Housing costs: 31 percent below the national average
  • Unemployment rate: 3.9 percent (U.S. average: 4.1 percent)
  • Poverty rate: 32.7 percent (U.S. average: 12.7 percent)
  • Groceries: 19.4 percent below the national average
  • Utilities: 12.1 percent below the national average
  • Transportation: 1.9 percent above the national average
  • Health care: 10.5 percent below the national average

One of just two cities on this list not located in the South — the other is Richmond, Indiana — Kalamazoo has the sixth-lowest housing costs in the nation and the second-lowest grocery costs.

Unfortunately, it also has the highest poverty rate of all the cities on our list.

Bottom line: The low costs in some areas aren’t enough for almost a third of Kalamazoo’s residents.

6. Wichita Falls, Texas

cheapest cities to live in

Image credit: Wikimedia

  • Cost-of-living index: 19.5 percent below the national average
  • City population: 104,724
  • Median household income: $43,997 (U.S. median: $55,322)
  • Median home listing price: $117,900 (U.S. median: $259,900)
  • Median monthly rent: $912
  • Housing costs: 31 percent below the national average
  • Unemployment rate: 3.3 percent (U.S. average: 4.1 percent)
  • Poverty rate: 20.6 percent (U.S. average: 12.7 percent)
  • Groceries: 14.2 percent below the national average
  • Utilities: 13.1 percent below the national average
  • Transportation: 14.8 percent below the national average
  • Health care: 11.3 percent below the national average

The most expensive cost category for Wichita Falls residents is health care, which is 11.3 percent below the national average. The city also enjoys a below-average unemployment rate.

Still, roughly 1 in 5 residents live below the poverty line despite a median household income that’s roughly on par with the city’s cost of living.

Bottom line: Wichita Falls’ median household income is slightly lower than its cost of living relative to the national average, making it easier for residents to afford to live there compared to some of the other cities on this list.

5. Tupelo, Mississippi

cheapest city to live in

Image credit: Wikimedia

  • Cost-of-living index: 20.8 percent below the national average
  • City population: 38,842
  • Median household income: $43,153 (U.S. median: $55,322)
  • Median home listing price: $169,900 (U.S. median: $259,900)
  • Median monthly rent: $1,100
  • Housing costs: 33.1 percent below the national average
  • Unemployment rate: 4.4 percent (U.S. average: 4.1 percent)
  • Poverty rate: 21.7 percent (U.S. average: 12.7 percent)
  • Groceries: 11.2 percent below the national average
  • Utilities: 26.2 percent below the national average
  • Transportation: 4.3 percent below the national average
  • Health care: 5.9 percent below the national average

Mississippi is the cheapest state to live in overall, but only Tupelo shows up in the five cheapest cities to live in.

Tupelo’s cost of living is low across the board, with the exception of health care costs. The cheapest expense in the area is housing, which is 33.1 percent below the national average.

Bottom line: Although Tupelo’s cost of living is low, its median household income is 22 percent below the national median. As a result, more than 1 in 5 residents live in poverty.

4. Richmond, Indiana

cheapest cities to live in

Image credit: Good Free Photos

  • Cost-of-living index: 21.3 percent below the national average
  • City population: 35,664
  • Median household income: $30,844 (U.S. median: $55,322)
  • Median home listing price: $74,500 (U.S. median: $259,900)
  • Median monthly rent: $800
  • Housing costs: 39 percent below the national average
  • Unemployment rate for Wayne County (in lieu of city data): 3.4 percent (U.S. average: 4.1 percent)
  • Poverty rate: 26 percent (U.S. average: 12.7 percent)
  • Groceries: 8.2 percent below the national average
  • Utilities: 9.5 percent below the national average
  • Transportation: 7.5 percent below the national average
  • Health care: 23.3 percent below the national average

Richmond ranks among the cheapest cities in several categories, including housing and health care.

That said, Richmond’s median household income is 44.3 percent below the national median, and more than a quarter of its residents live below the poverty line.

Bottom line: Richmond offers low home prices, but low income levels can make it difficult for residents to afford essential costs.

3. Harlingen, Texas

cheapest city to live in

Image credit: Wikimedia

  • Cost-of-living index: 21.5 percent below the national average
  • City population: 65,539
  • Median household income: $35,718 (U.S. median: $55,322)
  • Median home listing price: $135,000 (U.S. median: $259,900)
  • Median monthly rent: $1,200
  • Housing costs: 32.4 percent below the national average
  • Unemployment rate: 5.8 percent (U.S. average: 4.1 percent)
  • Poverty rate: 31.3 percent (U.S. average: 12.7 percent)
  • Groceries: 19.3 percent below the national average
  • Utilities: 0.4 percent below the national average
  • Transportation: 11.2 percent below the national average
  • Health care: 12.9 percent below the national average

Harlingen lies in Texas near where the Mexico border and the Gulf of Mexico meet. The city’s residents have a median household income that’s 35.5 percent below the national median, and a little less than a third of the city’s residents live in poverty.

Despite the fact that Texas is the largest oil-producing state in the country, Harlingen’s utility rates are on par with the national average.

Bottom line: With such a low median household income, Harlingen residents can find it difficult to meet their basic needs, even if those basic needs are cheap.

2. Conway, Arkansas

cheapest city to live in

Image credit: Wikimedia

  • Cost-of-living index: 22.2 percent below the national average
  • City population: 65,300
  • Median household income: $47,190 (U.S. median: $55,322)
  • Median home listing price: $175,000 (U.S. median: $259,900)
  • Median monthly rent: $1,000
  • Housing costs: 37.3 percent below the national average
  • Unemployment rate: 3 percent (U.S. average: 4.1 percent)
  • Poverty rate: 18.8 percent (U.S. average: 12.7 percent)
  • Groceries: 14.7 percent below the national average
  • Utilities: 19.2 percent below the national average
  • Transportation: 0.6 percent below the national average
  • Health care: 15 percent below the national average

Home to the University of Central Arkansas and Hendrix College, Conway lies on a bend in the Arkansas River.

The city’s median household income is the highest on our list of cheapest cities to live in. At only 14.7 percent below the national median, it makes living in the Little Rock suburb more affordable. Also, its unemployment rate is lower than the national average of 4.1 percent.

Bottom line: For the most part, residents find it easy to afford basic expenses in Conway. But not everyone benefits from the city’s low cost of living; almost 1 in 5 residents are living below the poverty line.

1. McAllen, Texas

cheapest cities to live in

Image credit: Flickr

  • Cost-of-living index: 24 percent below the national average
  • City population: 142,212
  • Median household income: $45,568 (U.S. median: $55,322)
  • Median home listing price: $208,990 (U.S. median: $259,900)
  • Median monthly rent: $1,300
  • Housing costs: 39.7 percent below the national average
  • Unemployment rate: 6.2 percent (U.S. average: 4.1 percent)
  • Poverty rate: 25.7 percent (U.S. average: 12.7 percent)
  • Groceries: 18.6 percent below the national average
  • Utilities: 9.5 percent below the national average
  • Transportation: 0.6 percent below the national average
  • Health care: 25.3 percent below the national average

Just 35 miles from another Texas town on our list — Harlingen — McAllen earns its spot as the cheapest city to live in by offering inexpensive costs in several areas. The city is among the five cheapest cities to live in for groceries and housing. Plus, it’s the cheapest city to live in for health care costs.

Its median household income, which is 17.6 percent below the national median, is also relatively higher than its cost-of-living index. In spite of that fact, a quarter of the city’s residents live in poverty.

Bottom line: As the cheapest city to live in, McAllen has a high median household income relative to other cities on this list. But 25.7 percent of its residents struggle to make ends meet.

Breaking down the expenses

The cheapest cities to live in have the lowest average of combined expenses, but that doesn’t mean everything is cheap. For example, Kalamazoo is the sixth-cheapest city in the U.S. overall, but its transportation costs are higher than the national average.

To give you more context, we broke down each category of expenses to show you which cities are the cheapest and which are the most expensive.

Cheapest and most expensive cities for groceries

For grocery costs, C2ER included meat, dairy, produce, bakery, and other miscellaneous grocery products. Here are the cheapest and most expensive cities for grocery costs based on the national average:

Cheapest cities to live in for groceries

  • Jackson-Madison County, Tennessee: 20.8 percent below the national average
  • Kalamazoo, Michigan: 19.4 percent below the national average
  • Harlingen, Texas: 19.3 percent below the national average
  • Temple, Texas: 19.2 percent below the national average
  • McAllen, Texas: 18.6 percent below the national average

Most expensive cities to live in for groceries

  • Honolulu, Hawaii: 55.4 percent above the national average
  • Hilo, Hawaii: 51.8 percent above the national average
  • Kodiak, Alaska: 50.1 percent above the national average
  • New York City, New York (Manhattan): 45.1 percent above the national average
  • Juneau, Alaska: 38.1 percent above the national average

Cheapest and most expensive cities for housing

Housing costs were based on rent and mortgage payments only; they didn’t include insurance or other costs of renting or owning.

Cheapest cities to live in for housing

  • Ashland, Ohio: 41.5 percent below the national average
  • McAllen, Texas: 39.7 percent below the national average
  • Lima, Ohio: 39.6 percent below the national average
  • Decatur-Hartselle, Alabama: 39.3 percent below the national average
  • Richmond, Indiana: 39 percent below the national average

Most expensive cities to live in for housing

  • New York City, New York (Manhattan): 384.5 percent above the national average
  • San Francisco, California: 257.9 percent above the national average
  • New York City, New York (Brooklyn): 222.5 percent above the national average
  • Honolulu, Hawaii: 198.5 percent above the national average
  • Orange County, California: 155.4 percent above the national average

Cheapest and most expensive cities for utilities

C2ER looked at all energy and home telephone costs but didn’t consider mobile phones in that calculation.

Cheapest cities to live in for utilities

  • Pueblo, Colorado: 27.1 percent below the national average
  • Provo-Orem, Utah: 26.7 percent below the national average
  • Lincoln, Nebraska: 26.7 percent below the national average
  • Tupelo, Mississippi: 26.2 percent below the national average
  • Columbus, Ohio: 25.7 percent below the national average

Most expensive cities to live in for utilities

  • Fairbanks, Alaska: 123.9 percent above the national average
  • Hilo, Hawaii: 112.4 percent above the national average
  • Honolulu, Hawaii: 94.8 percent above the national average
  • Boston, Massachusetts: 38.8 percent above the national average
  • Manchester, New Hampshire: 32.9 percent above the national average

Cheapest and most expensive cities for transportation

For this category, only gas prices and the cost of auto maintenance were included in the calculation.

Cheapest cities to live in for transportation

  • Thomasville-Lexington, North Carolina: 25.4 percent below the national average
  • Martinsville-Henry County, Virginia: 21.1 percent below the national average
  • Muskogee, Oklahoma: 19.1 percent below the national average
  • Augusta-Aiken, Georgia: 19.1 percent below the national average
  • Columbia-Maury County, Tennessee: 17.1 percent below the national average

Most expensive cities to live in for transportation

  • Hilo, Hawaii: 45.8 percent above the national average
  • Orange County, California: 36.1 percent above the national average
  • San Francisco, California: 34.5 percent above the national average
  • Olympia, Washington: 33.7 percent above the national average
  • Seattle, Washington: 32.2 percent above the national average

Cheapest and most expensive cities for health care

To get to the basics of health care costs, C2ER focused on the cost of an office visit for various physicians and over-the-counter and prescription drugs.

Cheapest cities to live in for health care

  • McAllen, Texas: 25.3 percent below the national average
  • Richmond, Indiana: 23.3 percent below the national average
  • Wilkes-Barre, Pennsylvania: 22.1 percent below the national average
  • Florence, Alabama: 21.6 percent below the national average
  • Jonesboro, Arkansas: 18.9 percent below the national average

Most expensive cities to live in for health care

  • Juneau, Alaska: 55.3 percent above the national average
  • Fairbanks, Alaska: 52.2 percent above the national average
  • Anchorage, Alaska: 41.9 percent above the national average
  • Kodiak, Alaska: 37.2 percent above the national average
  • Boston, Massachusetts: 32.5 percent above the national average

Consider all factors to see how far your income will go

The cost of living for a city is more than one number. Breaking down the cost into separate categories can help you understand which factors make up the whole.

It’s also important to understand that the fact that a city has relatively inexpensive costs doesn’t mean those costs are affordable. Low income levels can make it hard for residents to get by, and the cheapest cities to live in all have above-average poverty rates.

So, before you plan to move to one of these cities, consider the decision from every angle to determine if it’s the right choice for you.

Methodology: These rankings were based on data from the Council for Community and Economic Research (C2ER) for 253 urban areas across the United States, including Puerto Rico.

For added context, we also included population, income, and poverty data from the U.S. Census Bureau; housing cost data tabulated from C2ER in the second quarter of 2017; November 2017 unemployment rate data for available cities and December 2017 unemployment rate data for the national average from the U.S. Bureau of Labor Statistics; unemployment rate data from various sources for other cities; November 2017 median home listing prices for cities; national median home listing prices from Zillow; and median monthly rent costs from Trulia.

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Earnest Disclosures

To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.

Earnest fixed rate loan rates range from 2.98% APR (with Auto Pay) to 5.79% APR (with Auto Pay). Variable rate loan rates range from 1.99% APR (with Auto Pay) to 5.64% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of July 31, 2020, and are subject to change based on market conditions and borrower eligibility.

Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.

The information provided on this page is updated as of 7/31/2020. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at [email protected], or call 888-601-2801 for more information on our student loan refinance product.

© 2020 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.


5 Important Disclosures for LendKey.

LendKey Disclosures

Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it  endorse,  any educational institution.

Subject to floor rate and may require the automatic payments be made from a checking or savings account with the lender. The rate reduction will be removed and the rate will be increased by 0.25% upon any cancellation or failed collection attempt of the automatic payment and will be suspended during any period of deferment or forbearance. As a result, during the forbearance or suspension period, and/or if the automatic payment is canceled, any increase will take the form of higher payments. The lowest advertised variable APR is only available for loan terms of  5 years and is reserved for applicants with FICO scores of at least 810.

As of 10/15/2020 student loan refinancing rates range from 1.98% APR to 8.55% Variable APR with AutoPay and 2.99% APR to 8.77% Fixed APR with AutoPay.

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print to help you understand what you are buying. Be sure to consult with a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time.