Cheapest States to Live in 2025: Total Cost Including Taxes
June 12, 2025
Cost of Living Is More Than Just Taxes
When people ask "what's the cheapest state to live in?" they usually think of housing costs. But taxes are a major — and often overlooked — part of your total cost.
A state with cheap homes but high taxes can end up costing more than a state with pricier homes but lower taxes.
The Cheapest States by Total Tax Burden
Based on our state rankings, the states with the lowest combined property + income + sales tax burden:
| Rank | State | Total Tax Burden | Key Advantage |
|---|---|---|---|
| 1 | Alaska | 3.00% | No income tax, no sales tax, low property tax |
| 2 | Wyoming | 3.72% | No income tax, low everything |
| 3 | Nevada | 4.47% | No income tax, low property tax |
| 4 | South Dakota | 4.60% | No income tax, moderate property tax |
| 5 | Tennessee | 4.80% | No income tax, very low property tax |
| 6 | Florida | 4.92% | No income tax, moderate property tax |
| 7 | Texas | 5.72% | No income tax, but higher property tax |
But What About Housing Costs?
Here's where it gets interesting. Some low-tax states have expensive housing (Nevada = Las Vegas), while others are genuinely cheap across the board.
Low taxes AND cheap housing:
Low taxes BUT expensive housing:
The Best "Bang for Your Buck" States
Combining low taxes + affordable housing + reasonable quality of life:
1. Tennessee — No income tax, low property tax, Nashville/Memphis metros are affordable
2. South Dakota — Incredibly low tax, cheap housing, but harsh winters
3. Wyoming — Lowest total cost, but very rural (limited job market)
4. Oklahoma — Low taxes, very cheap housing, growing metros
5. Alabama — Some of the cheapest housing in the US, moderate taxes
What About Income?
Cheap living doesn't help if there are no jobs. States with low cost AND decent job markets:
How to Calculate Your Real Cost
1. Use our tax calculator to see your personalized tax burden in any county
2. Use the move calculator to compare two specific locations
3. Check state rankings for the overall picture
Your total cost = Housing + Taxes + Groceries + Transportation. We cover the tax part — combine it with housing data for the full picture.