Cheapest States to Move to in 2026: Cost of Living Rankings

The 10 cheapest states by composite cost-of-living index

The figures below come from our /data/states.json dataset, which combines BLS Consumer Price Index data, Zillow housing indices, MIT Living Wage estimates, and Tax Foundation state tax rates. The national average is indexed at 100; anything below 100 is cheaper than the U.S. average.

1. Mississippi — index 85.0, median home $157,800, income tax 4.7% (highest bracket)
2. Oklahoma — index 86.4, median home $178,700, income tax 4.75% (highest bracket)
3. Kansas — index 87.5, median home $199,700, income tax 5.7% (highest bracket)
4. Alabama — index 88.1, median home $178,500, income tax 5.0% (highest bracket)
5. West Virginia — index 88.2, median home $147,500, income tax 4.82% (highest bracket)
6. Missouri — index 88.5, median home $205,000, income tax 4.8% (highest bracket)
7. Tennessee — index 89.0, median home $275,000, no state income tax
8. Kentucky — index 89.4, median home $183,600, income tax 4.0% (flat)
9. Iowa — index 89.5, median home $194,000, income tax 3.8% (highest bracket)
10. Indiana — index 90.1, median home $197,800, income tax 3.05% (flat)

Why the cheapest states are cheap

Three structural factors drive the bottom of the list: housing supply, wage levels, and population growth. States with slow population growth and ample land for new construction — Mississippi, West Virginia, Kansas, Missouri — keep median home prices well below the national average, often in the $150K–$200K range. The trade-off is wage growth: many of these states post median household incomes 15–25% below the national figure, so a 20% reduction in cost of living may not improve your actual savings rate.

States near the top of the affordability list that combine low cost-of-living with strong job markets (Tennessee, Indiana, Missouri) typically produce the best net financial outcomes. Tennessee is the clearest example: 7th cheapest by composite index and has no state income tax, so a $90K household income keeps roughly $4,000–$5,000 more per year than the same household in California or New York.

The no-income-tax states, ranked

Nine states do not tax wages: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. New Hampshire's tax on interest and dividends was repealed effective 2025, leaving it with no general personal income tax. Ranking these by composite cost-of-living gives a more honest picture than the list above:

• Tennessee — COL 89.0, property tax 0.61%, sales tax 9.55% (high, but no income tax)
• Texas — COL 92.3, property tax 1.60% (high), sales tax 8.20%
• Wyoming — COL 92.4, property tax 0.61%, sales tax 5.36%
• South Dakota — COL 93.2, property tax 1.17%, sales tax 6.40%
• Florida — COL 100.7, property tax 0.91%, sales tax 7.50%
• Nevada — COL 101.2, property tax 0.50%, sales tax 8.23%
• Washington — COL 114.0, property tax 0.84%, sales tax 9.38%
• New Hampshire — COL 114.1, property tax 1.86%, no sales tax
• Alaska — COL 126.3, property tax 1.18%, sales tax 1.43% (lowest)

Three of the no-income-tax states (Alaska, Washington, New Hampshire) have composite cost-of-living indices above the national average because their housing and utility costs are unusually high. Florida and Nevada are roughly at the national average. Tennessee, Texas, Wyoming, and South Dakota are the four destinations where "no income tax" actually translates into meaningful household savings.

Texas vs Florida: a head-to-head comparison

Texas and Florida are the two most-discussed relocation destinations in 2026, and they show up constantly in "best states to move to" lists. The numbers say:

• Composite cost of living: Texas 92.3, Florida 100.7 — Texas is roughly 8% cheaper overall
• Median home price: Texas $302,000, Florida $389,100 — Texas housing is about 22% cheaper
• Sales tax: Texas 8.20%, Florida 7.50% — Texas slightly higher
• Property tax: Texas 1.60%, Florida 0.91% — Florida substantially lower
• State income tax: both 0%

For a $400K household, the composite difference is roughly $1,500–$2,500 per year in favor of Texas, driven mainly by housing. Florida's lower property tax can flip that math for higher-net-worth households with expensive homes. For most middle-income families, Texas comes out slightly ahead on a cost basis. Florida typically wins on climate, beaches, and absence of extreme weather risk in many metros (Miami-Dade, Broward, and the Keys are obvious exceptions).

How to evaluate a destination properly

Cost of living is the headline, but the things that change your actual quality of life are subtler. Before committing, work through this checklist:

1. Compare your specific income, not the median. Use the Cost of Living Comparison Calculator with your real salary and family size.
2. Run the multi-year tax model. A move to a no-income-tax state can save a $90K household $3,000–$5,000 per year in state income tax alone. The Relocation Tax Savings Calculator shows the five-year total.
3. Check insurance and climate costs. Florida's homeowners insurance is two to three times the national average. Wildfire risk in California and Colorado, hurricane risk along the Gulf, and flood risk in coastal areas can add 0.5%–1.5% of your home's value to annual costs.
4. Verify job market or remote-work feasibility. A cheap state with no employers in your field is a vacation, not a move.
5. Visit for two weeks, not two days. Day-to-day life is different from a long weekend. Test the commute, the grocery stores, the noise level, and the weekend social options.

Browse by state

For a state-by-state breakdown of moving costs, sales tax, and storage rates, see our State Guides directory. For a personalized side-by-side comparison, the Cost of Living Comparison Calculator is the fastest way to see what your specific income would look like in two different cities.

Frequently Asked Questions

Which U.S. state has the lowest cost of living in 2026?
Mississippi has the lowest composite cost-of-living index in our 2026 dataset at 85.0 — about 15% below the national average. Oklahoma (86.4), Kansas (87.5), Alabama (88.1), and West Virginia (88.2) round out the top five.

Which states have no income tax in 2026?
Nine states: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. New Hampshire's tax on interest and dividends was repealed effective 2025.

Is it cheaper to live in Texas or Florida?
Texas is slightly cheaper on a composite basis (COL 92.3 vs 100.7), driven mainly by housing. Florida's lower property tax can flip the math for higher-net-worth households. For most middle-income families, Texas wins on a cost basis; Florida typically wins on climate.

How do I compare cost of living between two states?
Use our Cost of Living Comparison Calculator. It weighs housing, utilities, groceries, transportation, healthcare, and state taxes using BLS, Zillow, and Tax Foundation data.

Are low cost-of-living states good for families?
They can be, but wages are usually lower too. A 20% cost-of-living reduction paired with a 15% salary cut nets to a small improvement. States like Tennessee, Texas, and Indiana combine low cost-of-living with no income tax (or flat low-rate income tax) and tend to produce the best net outcomes for families.