TL;DR: The Bureau of Economic Analysis’ Regional Price Parities (released February 19, 2026, covering 2024) rank Arkansas (86.9) as America’s cheapest state, followed by Mississippi, Iowa, and Oklahoma. In Arkansas, $100 buys about $115 of the same goods and services it buys nationally — roughly 15% more purchasing power.
What if your paycheck went 15% further without you earning a cent more? That’s the real-world math of moving to Arkansas. The U.S. Bureau of Economic Analysis (BEA) scores every state against the national average of 100: Arkansas’ 86.9 means a $100 national basket costs just $86.90 there. Regional Price Parities measure the actual prices consumers pay for goods, services, and rents. For contrast, California (110.7) tops the price list, and its housing rents (154.3) run nearly triple West Virginia’s (54.2).
1. Arkansas — 86.9 (RPP)
$100 buys $115.03. Arkansas takes the cheapest-state crown with prices 13% below the national average. It ranks lowest in the country for goods prices and third-lowest for housing rents (58.2), with a median two-bedroom rent of $907 and median home value of $188,000 (Census ACS).
2. Mississippi — 87.0
$100 buys $115.00. Mississippi trails Arkansas by a hair, with the second-lowest housing rents in America (56.5). The median home value of $169,800 is among the nation’s lowest, and the median two-bedroom rent is $913.
3. Iowa — 87.8
$100 buys $113.94. Iowa pairs low prices with above-average purchasing power: its price-adjusted real income per person ($60,144) exceeds the U.S. figure ($59,195). Median two-bedroom rent is $989, with steady insurance, manufacturing, and agribusiness jobs in Des Moines and Cedar Rapids. Watch-out: property taxes run high relative to home values (median $2,897 a year).
4. Oklahoma — 87.8
$100 buys $113.84. Tied with Iowa, Oklahoma combines cheap housing (median home value $199,800, two-bedroom rent $993) with a diversified energy and aerospace economy in Oklahoma City and Tulsa.
5. Louisiana — 88.2
$100 buys $113.37. Louisiana’s fifth-place finish is powered by cheap housing (rents parity 63.1, two-bedroom median $1,055) — though hurricane and flood insurance in coastal parishes can eat into the savings.
6. South Dakota — 88.6
$100 buys $112.88. The affordability standout that also pays: no state income tax on individuals, and price-adjusted real income per person of $69,153 ranks 5th nationally. Sioux Falls keeps growing, with a two-bedroom median rent of $987.
7. Alabama — 88.8
$100 buys $112.58. Housing rents sit nearly 39% below the national average, with a two-bedroom median of $960. Property taxes are a genuine bargain: owners pay a median of just $788 a year. Birmingham and Huntsville (aerospace and defense jobs) anchor the economy.
8. North Dakota — 89.0
$100 buys $112.41. The highest median household income on this list ($76,657), thanks to energy and agriculture, with a two-bedroom median rent of $950. The trade-off: some of the harshest winters in the lower 48.
9. West Virginia — 89.5
$100 buys $111.74. West Virginia has the cheapest housing rents in America (parity 54.2) — median home value $162,600 and two-bedroom rent $896, both the nation’s lowest. The caveat is real: incomes are among the country’s lowest (median household income $59,608), so cheap prices don’t always mean easy living.
10. Kansas — 90.1
$100 buys $111.03. Kansas rounds out the top 10 with price-adjusted real income ($59,172) essentially level with the U.S. average. The two-bedroom median rent is $1,042, and renters spend just 27.1% of income on rent — one of the lightest burdens anywhere. Wichita made our cheapest U.S. cities to rent in 2026 list — see also our cheapest cities to buy a home guide.
The honest catch: cheaper states, smaller paychecks
Price parity is only half the equation. Mississippi ($56,447) and West Virginia ($59,608) have among the lowest median household incomes in the country, and Arkansas ($60,773) ranks 48th — a smaller paycheck can outweigh cheaper prices. The genuine finds: Iowa and South Dakota pair bottom-tier prices with price-adjusted incomes at or above the national average, and North Dakota’s energy-driven wages offset its costs. Before moving, compare an actual job offer — not a state median — against local housing quotes, taxes, insurance, and healthcare access. BEA price parities also exclude income taxes, and tax mixes vary: South Dakota levies no individual income tax, while Iowa charges a flat 3.8% in 2026 and Arkansas tops out at 3.7%.
FAQ
What is the cheapest state to live in 2026?
Arkansas. The BEA’s Regional Price Parities released February 19, 2026 (covering 2024 data) give Arkansas an all-items score of 86.9 — the lowest in the nation, about 13% below the U.S. average.
What are the 10 cheapest states to live in?
Per 2024 BEA data: Arkansas (86.9), Mississippi (87.0), Iowa (87.8), Oklahoma (87.8), Louisiana (88.2), South Dakota (88.6), Alabama (88.8), North Dakota (89.0), West Virginia (89.5), and Kansas (90.1).
Which cheapest state has the best wages?
North Dakota, with a median household income of $76,657 (Census ACS). South Dakota ($75,081) and Iowa ($75,059) also pair low prices with solid incomes.
Which state has the cheapest housing?
West Virginia. Its BEA housing-rent parity of 54.2 is the nation’s lowest — roughly 46% below average — with a median home value of $162,600 and two-bedroom rent of $896, also the lowest in the country.
What is the most expensive state to live in?
California, at 110.7 on the BEA’s 2024 index — about 27% pricier than Arkansas. Hawaii (110.0), New Jersey (108.8), and the District of Columbia (109.9) follow.
Do cheap states have higher taxes?
It varies. South Dakota has no state individual income tax; Iowa charges a flat 3.8% in 2026 and Arkansas tops out at 3.7%. BEA price parities exclude income taxes, so research a state’s full tax mix separately.
Should I move to a cheaper state?
It depends on your job. The best moves pair low costs with strong wages — Iowa, South Dakota, and North Dakota fit that profile. Compare an actual salary offer against housing quotes, taxes, insurance, and healthcare access before deciding.
