These States Offer the Lowest Costs on Household Essentials

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Did your state make the list?


Key points

  • The cost of basic necessities varies greatly depending on where you live.
  • Idaho, Tennessee, and Texas are some of the states with the lowest costs in certain categories.
  • There are steps anyone can take, such as conserving energy and taking care of their health, to reduce the amount of their daily expenses.

The cost of living isn’t the only – or even the most important – factor when deciding where you want to live, but it’s definitely on everyone’s mind. Although some states tend to be more affordable than others, figuring out which has the cheapest cost of living isn’t as simple as you might think.

Some states have affordable housing but more expensive groceries and utilities or vice versa. Here’s a look at which states offer the most affordable prices for five common household products.

Cheapest grocery store: Texas

Texas groceries are 10.6% cheaper than the national average, according to the Missouri Economic Research and Information Center (MERIC). That’s nearly $776 in annual savings on groceries compared to what the average US household spends on them.

One of the reasons groceries in Texas might be so cheap is that the state leads the country in the number of farms and ranches. With so much food grown close to home, it costs less to ship and grocery store owners can pass those savings on to their customers.

Cheapest accommodation: Mississippi

Housing prices in Mississippi are 36.2% lower than the national average, according to MERIC. This puts the Mississippian’s average annual housing costs at $7,750 less than the typical American. If you’re curious about how your state fares, check out our research on average home prices by state.

Since housing is the biggest expense for most people, it’s no surprise that Mississippi also has the lowest cost of living. However, it should be noted that these numbers are only averages. It’s likely that there are some areas of the state where the costs are above average and others where the costs are even lower than the state average would suggest.

Cheapest Utilities: Idaho

Idaho’s overall cost of living falls toward the middle of the pack, but its utility costs are surprisingly affordable. Residents pay 18.2% less than the national average, according to MERIC. That’s a savings of about $757 a year over what the average American pays for their utilities.

Idaho is able to cut costs because more than half of its electricity costs come from hydroelectricity rather than traditional power plants. The state actually has the fourth highest share of renewable energy in the country. And its natural gas consumption is in the bottom third of states nationwide.

Cheapest transportation: Tennessee

Transportation costs in Tennessee are 12.1% lower than the national average. This equates to an average annual savings of $1,189 compared to the typical American.

But the actual savings likely depend on where in the state you live. Those who live in cities and have access to public transport are likely to save more than those who live in rural areas and have to drive more often.

Cheapest healthcare: Arkansas

The average cost of health insurance in Arkansas is 19.9% ​​lower than the US average. This will save the typical household over $1,030 compared to the average American. But there are a lot of variables here.

Seniors and people with chronic illnesses can save more than they would if they lived in another state. But they can also spend more than someone who sees the doctor less often.

Tips to save on your essential expenses

If your state didn’t make the list above, that doesn’t mean you’re doomed to pay high costs for everything. And if your state is on the list, that doesn’t mean you always get a lot. As with anything, you need to be aware of what you’re spending and look for ways to cut costs. Here are some tips to help:

  • Shop sales and look for coupons to use at the grocery store.
  • Compare the costs of apartments or houses before buying, and don’t forget to include related costs, such as home insurance and maintenance.
  • Turn off lights and televisions when not in use, and consider raising or lowering your thermostat a few degrees, depending on the season.
  • Use public transport whenever possible and combine your errands so you don’t have to drive as often.
  • Do your best to stay healthy and invest in good health insurance coverage to reduce your medical costs.

No matter where you live, making such moves can help you reduce your monthly expenses without changing your lifestyle too much. See if you can think of other ways to save, then put them into practice.

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