Best States for Cost of Living (2025-2026)

Which states offer the lowest cost of living in the United States? This ranking compares cost of living indices across states, based on data from the Bureau of Economic Analysis and the Council for Community and Economic Research. A lower cost of living means your money goes further, making these states attractive for remote workers, retirees, and families looking to maximize their purchasing power.

Key Takeaways

The most affordable states have cost of living indices below 95, significantly under the national average of 100.
Housing is the primary driver of cost differences between states, with affordable states having housing indices below 90.
Lower cost of living states often have lower salaries, so evaluate both factors together using our salary vs. cost of living pages.
States with lower costs may have higher property tax rates or sales taxes that offset savings.

Rankings

Rank	State	Cost of Living Index
1	Ohio	88
2	Michigan	89
3	Texas	92
4	Illinois	92
5	Georgia	94
6	North Carolina	96
7	Pennsylvania	97
8	Florida	100
9	Washington	120
10	New York	130

Key Insights

Ohio has the lowest cost of living index at 88 among our ranked states.
Midwestern and Southern states dominate the affordable living rankings.
Housing costs are the biggest factor separating affordable from expensive states.
Lower-cost states typically have lower average salaries, making purchasing power analysis essential.

Methodology

States are ranked by overall cost of living index, where 100 represents the US national average. Indices below 100 indicate lower-than-average costs. Data sources include the Bureau of Economic Analysis Regional Price Parities and the Council for Community and Economic Research Cost of Living Index. Category breakdowns include housing, utilities, food, transportation, and healthcare.

FAQ

Which state has the lowest cost of living?

Among our ranked states, Ohio has the lowest cost of living index at 88, followed by Texas, Illinois, and Georgia in the low 90s. Housing costs are the main factor driving these lower indices.

Is a lower cost of living always better?

A lower cost of living means your money goes further, but these states often have lower average salaries and fewer high-paying job opportunities. Use our salary vs. cost of living analysis to determine the best balance for your situation.

How do housing costs affect cost of living rankings?

Housing is typically the largest household expense. States with affordable housing markets (housing index below 90) consistently rank as the most affordable overall. Our cost of living pages provide detailed housing cost breakdowns per state.

Related Rankings

Best States for Salary Best States for Retirement Best States for Home Affordability

Official Sources

Canada calculators use data from the following official government agencies:

Canada Revenue Agency (CRA) — Federal and provincial income tax rates, CPP contributions, and RRSP limits.
Statistics Canada — Employment data, income statistics, and housing market data.
Bank of Canada — Interest rates, inflation data, and mortgage rate benchmarks.

Methodology

Our Canadian calculators use federal and provincial tax brackets, CPP/QPP contribution rates, and EI premiums published by the Canada Revenue Agency (CRA). Economic data is sourced from Statistics Canada. Mortgage calculations use Bank of Canada rates and market averages. All figures are for educational purposes.

Data Sources

All tax brackets, contribution rates, and economic data used in our calculators are sourced from the official government publications listed above. Rates are updated at least annually to reflect the latest tax year and regulatory changes. Users should verify critical figures with official sources or qualified professionals.

Last updated: June 2026. Information may change; always verify with official sources.

Last Updated: July 2026 — Reviewed Against Official Sources

Best States for Cost of Living (2025-2026)

Key Takeaways

The most affordable states have cost of living indices below 95, significantly under the national average of 100.

Housing is the primary driver of cost differences between states, with affordable states having housing indices below 90.

Lower cost of living states often have lower salaries, so evaluate both factors together using our salary vs. cost of living pages.

States with lower costs may have higher property tax rates or sales taxes that offset savings.

Rank

State

Cost of Living Index

100

120

130

Official Sources

Canada calculators use data from the following official government agencies:

Canada Revenue Agency (CRA) — Federal and provincial income tax rates, CPP contributions, and RRSP limits.

Statistics Canada — Employment data, income statistics, and housing market data.

Bank of Canada — Interest rates, inflation data, and mortgage rate benchmarks.

Methodology

Data Sources