The 25 Cheapest Places to Live: U.S. Cities Edition

• Cost of living: 14.3% below U.S. average
• Metro population: 167,796
• Median household income: $61,833 (U.S.: $69,717)
• Median home value: $167,100 (U.S.: $281,400)
• Unemployment rate: 2.6% (U.S.: 3.7%)

The Waterloo/Cedar Falls, Iowa, metro area is a manufacturing and agricultural center. And while entertainment and nightlife options might be minimal, outdoor and cultural activities abound.

Sportier types can take advantage of the many waterfront parks and a 67-mile bike trail running to Cedar Rapids. For a lazier afternoon, residents can enjoy the 40-acre Cedar Valley Arboretum & Botanic Gardens. The area also hosts two noted science museums and the highly regarded Waterloo Center for the Arts.

As for higher education, Cedar Falls is home to the University of Northern Iowa, which is where NFL Hall of Fame quarterback Kurt Warner played during his college days.

Major employers include agricultural machinery manufacturer Deere (DE) and Tyson Foods (TSN), which helps keep the unemployment rate under wraps.

All in all, it’s a Midwestern setting with typically affordable Midwestern prices. The metro area’s cost of living is more than 14% below the national average, led by housing costs that are almost 19% lower than what the typical American pays.

Be forewarned, however, that Iowa is one of the least tax-friendly states for middle-class families.

10 Facts You Must Know About Recessions

• Cost of living: 14.4% below U.S. average
• Metro population: 156,758
• Median household income: $57,041
• Median home value: $165,800
• Unemployment rate: 2.2%

Decatur and Hartselle are two northern Alabama cities with an abundance of outdoor activities, cultural diversions and low costs of living. Decatur’s economy benefits from being one of the busiest ports on the Tennessee River, and from NASA’s Marshall Space Flight Center in nearby Huntsville. Tourism is another driver of the local economy, thanks to the Wheeler National Wildlife Refuge, the Carnegie Visual Arts Center and festivals such as the Alabama Jubilee Hot Air Balloon Classic.

Nearby Hartselle, about 10 miles south, shares the charms of its neighbor to the north. Residents can cool off in the summer at the city’s sprawling aquatic center, which includes a water slide and diving platform. And Southern history buffs will want to stroll through the Hartselle Downtown Commercial Historic District, which is listed in the National Register of Historic Places.

Residents can enjoy all this and more without breaking the bank. Decatur’s housing-related costs, including mortgages and rents, are about 35% cheaper than the national average. Prices on a wide range of goods and services, from pizza to haircuts to dry cleaning, are less expensive, too.

How to Plan a Budget-Friendly Family Vacation

• Cost of living: 14.4% below U.S. average
• Metro population: 84,511
• Median household income: $57,706
• Median home value: $226,600 
• Unemployment rate: 2.7%  

Big Sky country comes with small prices in Great Falls, Montana.

Located on the Missouri River in the central part of the state just east of the Rocky Mountains, this affordable small city is known for its abundance of outdoor activities and cultural attractions.

And they all come at reasonable prices. The overall cost of living in Great Falls is more than 14% lower than the U.S. average, led by housing costs that are almost 30% less expensive. Locals save on groceries and utilities, too, although transportation costs and healthcare run above the U.S. averages.

The Pentagon is the region’s largest employer, thanks to the presence of Malmstrom Air Force Base and the Montana Air National Guard. Agriculture, healthcare, logistics and transportation services are also key parts of the local economy.

Although the great outdoors is probably the main attraction of Great Falls, the city is known for its abundance of museums, restaurants, bars, and it even boasts a symphony orchestra. 

Just be aware that Montana offers a mixed tax picture for both retirees and middle-class families. Income taxes are on the high side, while on the property-tax front, the statewide median rate is rather modest.

• Cost of living: 14.5% below U.S. average
• Metro population: 681,438
• Median household income: $57,392
• Median home value: $193,100 
• Unemployment rate: 3.8%

The Winston-Salem metro area – and its enclave of Thomasville-Lexington, in particular – packs tons of Southern hospitality at a price everyone from singles to families to retirees will like.

Not only do living costs run more than 14% below the national average, but the Tar Heel State doesn’t tax Social Security benefits. Winston-Salem doesn’t lack things to do, either: Six colleges, 75 recreational parks and 33 wineries call the region home, and Winston-Salem’s theater and visual arts heritage earned it the nickname “The City of the Arts.” It also boasts a huge healthcare sector, so doctors and specialists are not hard to find.

Meanwhile, the median home value is about two-thirds that of the U.S. level. Indeed, in Thomasville-Lexington, overall housing costs are 36% lower than what the typical American pays. The average apartment rents for $806 a month vs. a national average of $1,427. Transportation, meanwhile, is 28% less expensive.

Indeed, being among the cheapest U.S. cities to live in means residents of Thomasville-Lexington will find deals on all manner of other goods and services. Sugar is about 30% less expensive, cooking oil costs 28% less and you’ll save a big bundle having your tires balanced.

12 States That Won’t Tax Your Retirement Income

• Cost of living: 14.5% below U.S. average
• Metro population: 101,670
• Median household income: $51,497
• Median home value: $144,100 
• Unemployment rate: 5.3%

Lima, which sits about halfway between Toledo and Dayton, is known for both healthcare and manufacturing. The city serves as both a regional medical center and as home to Procter & Gamble’s (PG) Tide and Downy facility.

Residents catch a break on all manner of goods and services in this midwestern city, as overall costs of living run 14.5% lower than what the typical American pays.

Housing, naturally, is where the biggest savings are found. Keeping a roof over one’s head costs about 47% less in Lima, thanks to low home prices and apartment rents. Groceries and utilities are also cheaper than the U.S. average, but transportation and healthcare costs run a bit higher than average.

Lima is home to three major institutions of higher learning – the University of Northwestern Ohio, James A. Rhodes State College and The Ohio State University, Lima Campus – and also has a symphony orchestra. 

On the downside, the area still labors under its Rust Belt history. The unemployment rate is higher than the national level, as is the rate of poverty.

Additionally, would-be Buckeyes should know that Ohio is not tax-friendly to middle-class families or retirees. 

• Cost of living: 14.6% below U.S. average
• Metro population: 336,278
• Median household income: $56,746
• Median home value: $149,800
• Unemployment rate: 5.6%  

Rockford, Illinois, is another midwestern city that was once a manufacturing powerhouse and is still somewhat finding its way. The city, about 90 minutes northeast by car from downtown Chicago, still offers manufacturing jobs, and has branched out into healthcare, aerospace, logistics and other industries.

Major employers include Collins Aerospace, Woodward, Mercyhealth and United Parcel Service (UPS). Although the unemployment rate remains a bit high compared to the national level, it has fallen sharply in 2022. However, as with many Rust Belt locations, the poverty rate is elevated. 

On a cultural level, Rockford is loaded with places of historical, architectural or artistic interest. Anderson Japanese Gardens, Klehm Arboretum, Rockford Art Museum and the BMO Harris Bank Center are just a sampling of the city’s charms. Meanwhile, local state parks and golf courses cater to residents with a passion for the outdoors.

Best of all, Rockford packs all these economic and cultural offerings into a highly affordable package. The overall cost of living is almost 15% lower than the national average, once again led by low housing costs.

Overall housing expenses run 35% below the U.S. average, with especially attractive prices for homes. Indeed, a house sells for an average price of $300,000 vs. $465,991 nationally. Meanwhile, folks who rent an apartment save about $400 a month, on average. 

On the downside, transportation costs are about 18% higher than what the typical American pays, and healthcare is slightly more expensive too. 

• Cost of living: 14.6% below U.S. average
• Metro population: 893,002
• Median household income: $62,592
• Median home value: $232,100
• Unemployment rate: 3.1%

Thrifty types should volunteer to check out Knoxville and its greater metro area, one of three Tennessee cities to make the list for inexpensive living. The city is notable for its across-the-board affordability for everything from food to transportation, according to the Cost of Living Index.

The biggest savings, as per usual, come from the city’s especially low housing costs, which run more than a quarter below the U.S. average. Indeed, the typical price of a Knoxville home is $167,491 below the national average. Apartment rents are about a third less expensive.

Consider Knoxville, the original state capital before Nashville, a good mix of city and country living. It is home to the University of Tennessee and the Women’s Basketball Hall of Fame, but Knoxville is also the gateway to the Great Smoky Mountains. The Tennessee River runs through downtown.

Major employers include the U.S. Department of Energy, Alcoa (AA) and Covenant Health.

The city was a strategic objective in the Civil War, so history buffs can visit a number of battlefields nearby, too.

Home Sale Prices in the 50 Largest Metro Areas

• Cost of living: 14.8% below U.S. average
• Metro population: 180,799
• Median household income: $52,186
• Median home value: $158,700 
• Unemployment rate: 3.9% 

Jackson, Tennessee, and surrounding Madison County are located 90 miles northeast of Memphis, serving as a regional center of trade for West Tennessee. Some of the area’s largest employers include Kellogg (K), Stanley Black & Decker (SWK) and Masco’s (MAS) Delta Faucet Company.

The city doesn’t lack for leisure activities either. The Ned R. McWherter West Tennessee Cultural Arts Center, the West Tennessee Healthcare Sportsplex and the International Rock-A-Billy Hall of Fame Museum are just three of the city’s main attractions.

And it all comes in an affordable package. The overall cost of living is 14.8% lower than the national average, led by particularly low healthcare, transportation and housing expenses.

Indeed, housing costs, including mortgages, rents and insurance, are nearly 30% lower than the U.S. average. Folks looking to buy will be happy to hear the average house price stands at $347,983, a savings of $118,000 when compared to the national average. Average apartment rent is $987 vs. $1,427 for the U.S. as a whole.

• Cost of living: 15.0% below U.S. average
• Metro population: 83,687
• Median household income: $55,088
• Median home value: $151,100 
• Unemployment rate: 5.2%  

As a longtime manufacturing hub for the global automotive industry, it follows that Kokomo’s major employers include Chrysler Indiana Transmission, General Motors (GM), Aptiv (APTV) and Haynes International (HAYN).

One disadvantage of Kokomo’s dependence on the auto sector is that it makes the local economy especially sensitive to downturns. The area’s unemployment rate peaked at 30% during the 2020 pandemic-caused recession. Thankfully, unemployment has since plummeted, and currently stands at a low level, at least in absolute terms.

Fortunately, the low cost of living helps cushion the blow when Kokomo does periodically hit hard times. Indeed, the metro area’s poverty rate is lower than both the state and national levels.

Area residents spend about 38% less on overall housing costs. Folks save significant dollars on transportation and grocery items, as well, but utilities run about 18% higher than what the typical American pays. One notable downside, however, is that Indiana isn’t particularly tax-friendly to retirees.

If you’re just passing through, the Old Silk Stocking Neighborhood, the Seiberling Mansion and the Elwood Haynes Museum are just a few architectural and historical gems that are not to be missed.

PODCAST: The 2022 Real Estate Market with Daniel Bortz

• Cost of living: 15.1% below U.S. average
• Metro population: 151,517
• Median household income: $51,639
• Median home value: $156,200 
• Unemployment rate: 2.7%

Florence and the Florence-Muscle Shoals metro area, which encompasses the birthplace of Helen Keller, sits in the northwest corner of Alabama on the Tennessee River. It’s about a two-hour drive from Birmingham.

In addition to a low cost of living, Florence – and the surrounding area known by locals as The Shoals – boasts a number of attractions and a rich history of music. Florence native W.C. Handy’s legacy as the “Father of the Blues” is celebrated with an annual summer festival. And it’s no coincidence The Rolling Stones recorded the hit songs “Wild Horses” and “Brown Sugar” at the nearby Muscle Shoals Sound Studio.

Florence claims Alabama’s only house designed by legendary architect Frank Lloyd Wright. The city also hosts the University of North Alabama.

Happily for residents of Florence, the city’s distinctive sites and southern charm come at a reasonable price. Housing-related expenses are almost 38% lower than what the average American pays. Healthcare, meanwhile, costs about 22% less.

All other major expenses tracked by the Cost of Living Index likewise take a smaller bite of folks’ paychecks, securing Florence’s place among the 25 cheapest places to live.

Taxes in Retirement: How All 50 States Tax Retirees

• Cost of living: 15.3% below U.S. average
• Metro population: 719,146
• Median household income: $74,208
• Median home value: $229,900 
• Unemployment rate: 2.4%

Des Moines kind of has it all: a robust and multifaceted economy; a vibrant cultural scene; major universities; and – most importantly for our purposes here – a low cost of living.

On the economic front, Des Moines is probably best known as a major center of the insurance industry and other financial services. Healthcare, manufacturing and logistics are also key planks supporting the local labor market. 

Happily, Des Moines’ strong economy helps keep both the unemployment and poverty rates well below state and national averages.

The city also benefits from a comparatively large student population, driven by Drake University, Grand View University, Mercy College of Health Sciences and numerous other institutions of higher learning.

At the other end of the age spectrum, Des Moines is known for being especially attractive to retirees. The city boasts plenty of healthcare facilities specializing in aging-related services.

Retirees won’t lack for things to do, either. There are numerous museums and arts venues, including an outdoor sculpture park, a zoo and botanical gardens. There’s even a casino and racetrack in nearby Altoona that hosts annual camel, ostrich and zebra races (sorry, no wagering on these exhibition races allowed).

Best of all, Des Moines delivers all this with a cost of living that’s 15.3% lower than the U.S. average. Housing expenses are almost 30% less than what the typical American spends to keep a roof over his or her head, while transportation and utilities costs are significantly lower too. 

• Cost of living: 15.6% below U.S. average
• Metro population: 700,015
• Median household income: $63,367
• Median home value: $181,700 
• Unemployment rate: 4.0%  

Akron is famous for its long history of manufacturing tires and other rubber goods, hence the nicknames Rubber City, City of Invention and Rubber Capital of the World. And even today, Goodyear remains a major employer and the city is recognized as a global center of polymer research and development. More than 35,000 people in the Akron area are employed in approximately 400 polymer-related companies.

The metro area abounds with educational, artistic and cultural offerings, as well. The University of Akron, the Ohio Ballet and the Akron Symphony Orchestra all call the city home. Other entertainment options include the Akron Rubber Ducks, which serves as the Cleveland Guardians AA baseball team. The club plays in Canal Park, a state-of-the-art baseball stadium on Main Street in downtown Akron. 

And yet the metro area’s 700,000 residents enjoy a cost of living almost 16% below the national average. Housing costs, which account for mortgages, rents, insurance and related expenses, are 40% lower in the Akron area, according to the Cost of Living Index. Utilities and healthcare are also much better deals – citizens save as much as 18% on those bills. Transportation expenses do run a tad high though, or 1% greater than what the typical American pays.

• Cost of living: 15.6% below U.S. average
• Metro population: 270,119
• Median household income: $58,354
• Median home value: $167,000 
• Unemployment rate: 2.8%

Amarilloans are known for their love of high school football, hot sauce and thick steaks. They also enjoy savings on a wide range of goods and services. Need to get your eyes checked? An appointment with an optometrist is 37% less expensive in the city known as “The Yellow Rose of Texas.” Dry cleaning bills are about two-thirds the national average. And you’ll save about 16% getting your washer repaired after it inevitably breaks down.

But the biggest way folks in this part of the Texas Panhandle save money is by what they shell out for housing.

Metro-area residents spend about 30% less on housing-related costs vs. the national average. The average house price of $312,380 is $154,000 below the national average. Apartment rents are almost 30% cheaper than what the typical American pays every month.

It’s also encouraging that Amarillo’s economy has bounced back well since the short-but-sharp recession of 2020. For example, the metro area’s unemployment rate of 2.8% stands below the national rate of 3.7%. Major employers include Tyson Foods (TSN), CNS Pantex and BSA Health System.

However, despite having no state income tax, Texas’s tax picture for middle-class families is fairly mixed. Sales taxes run high, for instance, as do property taxes.

10 States With the Lowest Gas Taxes

• Cost of living: 16.4% below U.S. average
• Metro population: 616,395
• Median household income: $56,515
• Median home value: $182,000 
• Unemployment rate: 3.6% 

While most sports enthusiasts associate Augusta with the storied Masters tournament, there’s much more to this city than golf. The metro area, which includes Aiken, South Carolina, is a major center for cybersecurity companies thanks to the presence of the U.S. Army Cyber Command at nearby Fort Gordon.

Augusta is also a regional hub for medicine and biotechnology, supported by Augusta University – the state’s only public health sciences graduate university – and the allied Medical District of Augusta.

Happily for locals, the area remains among the country’s cheapest cities to live in despite the presence of so many well-paid occupations. Augusta-Aiken’s cost of living runs 16.4% below the U.S. average, helped by housing costs that are almost a third less expensive than what the typical American pays. Folks pay about 12% less than the national average for utilities and healthcare, and get a nearly 22% break on transportation.

And older citizens catch yet another break: Georgia happens to be one of the more tax-friendly states for retirees.

As much as the Masters dominates outsiders’ imagination about this city, which sits a two-and-a-half-hour drive from downtown Atlanta, it has much more going on than golf. Phinizy Swamp Nature Park, minutes from downtown Augusta, offers 14 miles of hiking trails. Aiken is home to the University of South Carolina Aiken and the Aiken Thoroughbred Racing Hall of Fame and Museum.

The 10 Most Tax-Friendly States for Middle-Class Families

• Cost of living: 16.6% below U.S. average
• Metro population: 586,758
• Median household income: $54,123
• Median home value: $178,100 
• Unemployment rate: 3.1% 

Metro Jackson is a surprisingly eclectic city that holds appeal for Civil War buffs, blues music aficionados and even ballet fans. Every four years, dancers from around the world flock to Jackson for the two-week USA International Ballet Competition to compete for medals, scholarships and spots in ballet companies. Similar competitions are held only in Russia, Bulgaria and Finland.

The state capital also happens to be a great place for retirees. The Milken Institute ranks Jackson eighth among the best large cities for successful aging due to its affordability and an abundance of nurses, nurse practitioners and orthopedic surgeons, as well as caregiving options and geriatric facilities.

Older folks also benefit from Mississippi’s tax-friendly approach to retirees. The state exempts Social Security benefits from state income tax, among other breaks. The tax situation for middle-class families, however, is more mixed.

Jackson falls within the top 15 cheapest U.S. cities to live in. Overall living costs are almost 17% cheaper than the national average, led by housing, which is close to a third less expensive. Utilities and transportation expenses are also big bargains. Healthcare costs, however, run about 5% higher than the U.S average.

The 15 Best Stocks to Buy for the Rest of 2022

• Cost of living: 16.7% below U.S. average
• City population: 65,126
• Median household income: $53,029
• Median home value: $230,900 
• Unemployment rate: 2.5% 

The city of Conway – an affordable enclave in the Little Rock-North Little Rock-Conway metro area – is home to a number of high-tech companies, including information technology firm Insight Enterprises (NSIT).

At the same time, a large proportion of younger residents helps keep costs in check. Known as “The City of Colleges,” Conway hosts three post-secondary educational institutions: the University of Central Arkansas, Hendrix College and Central Baptist College.

Close proximity to the Arkansas River and Lake Conway makes the city ideal for fishing and water sports, and there’s ample space for hunting. Yet you can drive to the state capital of Little Rock in a half-hour or so.

Not that Conway is without its own highfalutin cultural attractions. The city is home to the Arkansas Shakespeare Theatre, the state’s only professional Shakespeare theater.

Although Conway’s median home value is among the highest on the list of the 25 cheapest U.S. cities, it’s still well below the U.S. median, and housing-related costs run almost 27% below the national average. Groceries, transportation and healthcare costs are also comparatively modest.

Arkansas also isn’t terribly tax-burdensome to retirees. Arkansas exempts Social Security benefits and up to $6,000 of retirement income from its state income tax, and all military pension income is tax-exempt.

First Apartment Checklist: Make the Most of Your Search

• Cost of living: 16.8% below U.S. average
• Metro population: 1,441,647
• Median household income: $61,815
• Median home value: $190,800 
• Unemployment rate: 3.3% 

The largest city in Oklahoma offers remarkably affordable prices for its size. The biggest reason: Housing costs run 27% below the national average, according to the Cost of Living Index, which takes into account both home prices and apartment rents. 

Drilling down into those categories, home prices in Oklahoma City average $340,300 vs. a national average of $465,991. Renters also do quite well on a relative basis. Average apartment rent comes to $892 a month compared with a U.S. average of $1,427.

Utilities, groceries and transportation also cost appreciably less in Oklahoma City. Healthcare, however, is slightly pricier than what the typical American pays. 

And, yet, as a metro area with 1.4 million people, Oklahoma City offers a lot of big-city attractions, from a philharmonic orchestra to the National Softball Hall of Fame and Museum. At the professional sports level, the Oklahoma City Thunder represents the metro area in the NBA. 

Meanwhile, a well-rounded metro-area economy helps folks find jobs in a wide range of industries. Major employers include the U.S.A.F.’s Tinker Air Force Base, the University of Oklahoma and Amazon.com (AMZN). 

Be forewarned, however, that Oklahoma is not tax-friendly for middle-class families and presents a mixed tax picture for retirees. 

• Cost of living: 17.2% below U.S. average
• Metro population: 430,714
• Median household income: $49,691
• Median home value: $159,100 
• Unemployment rate: 3.5% 

The city of Mobile, Alabama, was founded in 1702 by the French and for the next century served as a colony of France, England and Spain. The colonial past and a mixture of Creole, African and Catholic heritage gives Mobile one of the more distinctive cultures of any American city.

Additionally, Mobile stands out as a Gulf Coast gem, with numerous art museums, a symphony orchestra, a professional opera and a professional ballet company.

Happily, the metro area and its abundance of activities and traditions come with affordable living costs, which stand at better than 17% below the national average. Housing costs are particularly affordable, or 42% less than what the typical American pays. Transportation and miscellaneous goods and services are likewise comparative bargains, which also help Mobile maintain its place among the top 10 cheapest places to live in the U.S.

As a port city, it should come as no surprise that shipbuilder Austal USA is among the area’s major employers. However, jobs abound in healthcare, high tech and engineering too.

Meanwhile, folks who’ve put their working years behind them will be happy to know that Alabama is among the most tax-friendly states for retirees.

15 U.S. Cities With the Highest Average Home Prices

• Cost of living: 17.5% below U.S. average
• Metro population: 182,541
• Median household income: $55,045
• Median home value: $149,500 
• Unemployment rate: 2.3%  

It used to be that Joplin, at least to outsiders, was probably best known as a place where Depression-era bank robbers Bonnie and Clyde hid out for a time. Today, sadly, Joplin is perhaps better known for tornados, such as the deadly storm that destroyed about 30% of the city in 2011.

The city and greater metro area has since recovered from the costliest single tornado in modern U.S. history, helped by its status as a regional medical center. Its two major hospitals serve a four-state area that includes Kansas, Oklahoma and Arkansas.

Meanwhile, other key employers include General Mills (GIS), Schaeffler Group (SFFLY) and Leggett & Platt (LEG), whose stock happens to be a member of the S&P 500 Dividend Aristocrats.

Housing-related costs are about 38% below the national average, and a large reason why Joplin ranks in the top 10 cheapest places to live among larger U.S. cities. Costs for groceries, healthcare and utilities are comparatively low, as well.

From a tax perspective, Missouri is pretty average, but the state did recently lower its top income tax rate to 5.3% from 5.4% for 2022. It’s dropping again – to 4.95% in 2023  – with more rate reductions possible in the future. 

37 Ways to Earn Up to 9% Yields on Your Money

• Cost of living: 17.6% below U.S. average
• Metro population: 115,972
• Median household income: $46,524
• Median home value: $139,400 
• Unemployment rate: 4.4% 

About an hour’s drive east from Birmingham sits the Anniston metro area. The city’s proximity to the Mountain Longleaf National Wildlife Refuge makes it a good jumping-off point for hikers, mountain bikers and other outdoorsy types. The city also has its quirks. It’s home to the world’s largest office chair – a 33-foot-tall seat that was once recognized by Guinness World Records.

Major employers include the Anniston Army Depot and Alabama Regional Medical Center.

Anniston’s low cost of living puts it among the 10 cheapest U.S. cities to live in, but it comes alongside a median income that’s a third lower than the national median. That said, household incomes and home values are higher in other parts of Calhoun County, of which Anniston is the county seat.

Either way, overall housing costs in the Anniston area are 42% lower than what the average American pays. Utilities, however, are relatively pricey, running 22% above the national average.

Alabama also happens to be a fairly tax-friendly state. While most people end up paying the highest income tax rate, it’s not too bad at only 5%. Alabama also boasts the second-lowest median property tax rate in the country.

Although the income picture could be brighter, Anniston has its charms, including Victorian homes and historic churches among other architectural gems.

5 Top-Rated Housing Stocks to Buy Now

• Cost of living: 19.4% below U.S. average
• Metro population: 232,670
• Median household income: $57,474
• Median home value: $154,800 
• Unemployment rate: 2.7% 

Sitting along the Kansas River out on the prairie, Topeka is known for its dense suburban feel of single-family homes, parks and plenty of coffee shops.

And as the capital of Kansas, Topeka can always count on the state government as a source of good and stable employment. Happily, the metro area supports jobs in plenty of other industries too, including healthcare, retail and manufacturing.

The city is home to Washburn University and the Topeka Symphony Orchestra, but there are plenty of less high-falutin attractions, as well. For example, the  1989 opening of Heartland Park Topeka transformed the city into a major host of motorsports. 

Topeka cracks the top five cheapest places to live in the U.S. for city dwellers thanks to a cost of living that’s almost a fifth lower than the national average. Once again, housing costs lead the way on savings. Indeed, housing is cheaper than the U.S. average by about 28%. Groceries are similarly discounted compared to what the typical American shells out at the supermarket. Locals save substantial bucks on utilities, transportation and healthcare, as well. 

On the downside, Kansas ranks among the least tax-friendly states for both middle-class families and retirees, alike. 

• Cost of living: 20.7% below U.S. average
• Metro population: 261,108
• Median household income: $62,128
• Median home value: $208,300 
• Unemployment rate: 4.5%

Kalamazoo is the cheapest city in the U.S. Sadly, that’s very much a necessity for too many of its residents.

In the city of Kalamazoo proper (pop. 73,255), nearly 31% of residents live below the poverty line. (At the metro level, which includes Portage, Michigan, the figure comes to 14.5%.) The U.S. and Michigan state poverty rates are 12.8% and 13.1%, respectively.

Another downside? Michigan is among the least tax-friendly states for middle-class families.

On the brighter side, Western Michigan University, with its multiple campuses and research facilities, is a major driver of the local economy. Medical equipment maker Stryker (SYK) is headquartered in the city, and Pfizer (PFE), the drug company, maintains its largest manufacturing site in Kalamazoo. In late 2022, the pharma giant committed to investing $750 million into its Kalamazoo facility, creating 300 well-paying jobs, notes Michigan Governor Gretchen Whitmer.

As for recreational activities, the Kalamazoo Nature Center hosts free daily activities. Nearby parks offer a combined 140 miles of trails and three swimming beaches. If you want to get away to the big city, Chicago is less than three hours by car if traffic is merciful. For these reasons and more, Kalamazoo also ranks among the best places to retire.

12 Questions Retirees Often Get Wrong About Taxes in Retirement

• Cost of living: 21.8% below U.S. average
• Metro population: 880,356
• Median household income: $44,818
• Median home value: $107,500 
• Unemployment rate: 4.3%

McAllen might be one of the cheapest places to live in the U.S., but it comes at a price. The poverty rate in the McAllen-Edinburg-Mission metro area is 29.3%. That’s more than double both the Texas rate of 14.3% and the U.S. rate of 12.8%. 

On the plus side, McAllen is famous for bird watching because of its location on a major migration route. The Quinta Mazatlan, a luxury birdhouse with more than 15 acres of birding habitat, is not to be missed. The city also features the International Museum of Art & Science, which has a specific focus on Latin American art.

And McAllen is indeed one of the cheapest U.S. cities to live in. Housing costs are 45% lower than the national average, healthcare expenses are 19% cheaper and grocery items are around 16% less than what the typical American pays. One of the few things residents pay a little extra for is utilities, which isn’t surprising given that temperatures routinely soar into the high 90s during the summer months.

But surprisingly, Texas isn’t a great place when it comes to taxes. How does a state with no income tax at all not end up on the “most tax-friendly” list? It starts by having the seventh-highest median property tax rate in the country.

10 States with the Highest Gas Taxes

• Cost of living: 22.0% below U.S. average
• Metro population: 102,432
• Median household income: $46,807
• Median home value: $110,800 
• Unemployment rate: 5.7%

Decatur, Illinois, and its surrounding metro area is probably best known as an agricultural and manufacturing center. Archer Daniels Midland (ADM) moved its headquarters to Chicago in 2013, but maintains significant operations in this central Illinois city. Caterpillar (CAT), the world’s largest maker of construction and mining equipment, has facilities there. Decatur likewise lays claim to a massive corn-processing plant owned by U.K.-based food ingredients company Tate & Lyle (TATYY).

Archer Daniels Midland’s departure following a price-fixing scandal was a blow to the local economy, and Decatur struggles with elevated unemployment to this day. A cost of living that’s 16% below the national average is partly a symptom of ADM’s exit, but at least it’s also something of a salve.

Housing costs are close to half the national average in metro Decatur, and healthcare, utilities and transportation are notably cheaper too. Those savings help make up for the fact that Illinois is among the least tax-friendly states for middle-class families.

Decatur’s status as one of the cheapest places to live in the U.S. is no doubt appreciated by its significant student population, which includes Millikin University’s approximately 2,000 students and the roughly 4,000 people studying at Richland Community College.

13 Tax Breaks for Homeowners and Home Buyers

• Cost of living: 24.4% below U.S. average
• Metro population: 423,029
• Median household income: $48,115
• Median home value: $103,500 
• Unemployment rate: 5.4%  

Harlingen currently ranks as the cheapest place to live in the U.S. among cities with metro areas with at least 50,000 inhabitants.

The city sits at the southernmost tip of Texas, with the Rio Grande to the south and the Gulf of Mexico to the east. The Brownsville-Harlingen metro area is a hardscrabble place where 24.7% of residents live below the poverty line. That’s about one-and-a-half times the poverty rate for Texas as a whole. Comparatively low median household income and high unemployment are other grim aspects of the metro area’s economy.

However, just about everything, from groceries to gasoline, costs less in Harlingen. Locals save about 20% on a good cut of steak compared to the national average (this is Texas, after all). The average home price in Harlingen is a striking $182,500 less than the U.S. average. The average apartment rents for $790 per month – or 45% lower than the national average of $1,427.

As with not-too-distant neighbor McAllen, utility bills run a bit high, or 5.3% above the national average.

Although agriculture remains central to Harlingen’s local economy, the healthcare and telecommunications industries are rapidly gaining importance. 

Lastly, it would be negligent not to mention one of the area’s biggest selling points: Harlingen is only about an hour’s drive to the beaches of South Padre Island.

Warren Buffett Stocks Ranked: The Berkshire Hathaway Portfolio