Arkansas tops list of cheapest states to live in as California remains most expensive

Arkansas is the cheapest state to live in, according to a ranking of all 50 states that weighed two key factors: housing affordability and the overall cost of living. The study analyzed monthly costs for renters and homeowners against prices for groceries, utilities and transportation, and found Arkansas at the bottom of the expense ladder. Arkansas had the lowest cost of living and the third-cheapest housing among the states. The state’s median household income was $62,106, and the average home price in September was $216,692, illustrating a notably low-cost baseline for residents.

Mississippi ranked second, with the second-lowest cost of living and the most affordable housing. Its median household income was $59,127, and the average home value was $187,882. West Virginia came in third, ranking eighth in cost of living but second in affordable housing. Its median household income was $60,798, and the average home price was $170,114. South Dakota followed in fourth place, offering the third-lowest cost of living and the sixth most affordable housing market, with a median household income of $76,881. Oklahoma was fifth, featuring the fourth-lowest cost of living and the seventh most affordable housing. The median household income was $66,148, and the average home price was $215,674.

Louisiana, Iowa, Alabama, North Dakota and Kentucky rounded out the list of the cheapest states to live in.

On the opposite end of the spectrum, California was the most expensive state to live in, with the highest cost of living and the least affordable housing. New Jersey followed as the second-most-expensive state, with the second-highest cost of living and the second-most-expensive housing. The median household income was around $104,000, and the average home price in September was $562,460. Hawaii was ranked third most expensive, with the median household income just over $100,000 and the average home value $824,130. Massachusetts was next, ranking fourth in expense, with the fifth-highest cost of living and fourth-most-expensive housing; the state posted an average home price of $647,505 and the median household income was the highest of all states, at almost $105,000. Washington rounded out the top five most expensive states to call home.

Next in the rankings was New York, followed by Florida, Colorado, New Hampshire and Maryland. Overall, Southern states dominated the cheaper end of the spectrum, a pattern the analysis connected to lower tax burdens and lower population density, factors that help keep prices for essentials and housing more affordable in those areas.

The report reflects broader questions families face when considering relocation or reassessing budgets as inflation and housing markets shift. While the cheapest states offer notable cost advantages, wage levels, job opportunities and access to services also shape how far a paycheck truly goes in any given location.