How High is the Cost of Living in Tennessee?
The cost of living in Tennessee is significantly lower than the national average, even though home values are on the rise.
Written by Natalie Todoroff
Reviewed by Melanie Reiff
Life in Tennessee is great for country music lovers, outdoor explorers, or anyone looking for a little more wiggle room in their budget. Out of all the states, Tennessee is the sixth cheapest to live in. Here to dive into the numbers is,
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How high is the cost of living in Tennessee?
First, we should zoom out to take a look at the cost of living index. The average cost of living index in the United States is 100. Any state with an index above 100 is more expensive than average to live in, while below 100 is less.
Tennessee’s cost of living index is 87.6, making it one of the cheapest places you can live in the entire country! That said, there are a couple of outliers. Nashville’s cost of living is 101.4, while
Brentwood
(an affluent suburb a couple of miles outside of Nashville) has a sky-high index of 161.3. But these cities are the exception, not the rule—across the board, Tennessee is a fairly inexpensive place to live. Let’s take a look at how Tennessee compares to some of its neighboring states:
But, what exactly does the cost of living index mean in terms of your actual monthly budget? With a little help from MIT’s
Living Wage Calculator
, let’s put it in terms of monthly essentials like food, healthcare, and housing. Food: $279 to $999 per month
We should clarify that when we say food, we’re strictly talking about groceries. Any date night splurges, late-night Postmates, or morning Starbucks runs aren’t accounted for in the numbers below.
Per year, Tennesseans spend between $3,351 to $11,999 on groceries, depending on the size of their household. A single adult’s grocery bill will total around $279.25 each month, while a family of four could be as high as $821.33 every month. To put this into perspective, the Bureau of Labor Statistics found in 2020 that the average monthly grocery bill for US households was approximately $411.
Healthcare: $524 per month
According to 2020 data from the Bureau of Economic Analysis, Tennessee residents spend an average of $6,295 per year on healthcare expenses. Per month, that’s about $524–almost $50 more than the national average of $477.
Unlike food expenses, though, the cost of healthcare can vary greatly from individual to individual. If someone in your household has pricey prescriptions and requires frequent doctor’s visits, you’ll probably pay more for healthcare in Tennessee.
Housing: $717 to $1512 per month
Tennessee home value has increased 27.1% from June 2021 to June 2022, with an average home value of $299,571. Amazingly, it’s still well below the US average home value of $337,560. So, while home value is on a current upward trend in The Volunteer State, they remain affordable by national standards.
But, what exactly does that look like in terms of monthly costs? Here are some average housing costs in Tennessee. As you can see, what you pay ultimately depends on what kind of space you live in:
- Average monthly mortgage payment: $1,147
- Average studio rent: $717
- Average one-bedroom rent: $800
- Average two-bedroom rent: $980
- Average three-bedroom rent: $1,287
- Average four-bedroom rent: $1,512
Again, these are just the overall state averages. About 93% of Tennessee is considered rural, so rents in those areas stand to be much lower. But, on the other hand, rents in larger cities like Nashville are much higher at $1,694—but still below the all-time high US average rent of $1,904.
Transportation: $459 to $1358 per month
Because Tennessee is a mostly rural state, driving is the best way to get around. That said, there’s a pretty broad average estimate of what Tennesseans pay per month to get around. On average, it’s estimated that they spend between $459 to $1,358 each month in transportation expenses, while the average US two-person household spends $818 per month.
Some average transportation costs are:
- Monthly WeGo Bus pass in Nashville: $65
- Average commute length: 25 minutes
- Average cost of a gallon of gas, July 2022: $4.12
How much you need to live comfortably in Tennessee: $32,135 to $97,549 per year
So, all tallied up, a single adult living in Tennessee needs to make at least $32,125 a year or $15.45 per hour. A family of four needs much more; it’s estimated that a four-person household needs to make $83,897 a year or $40.43 per hour.
Although Tennessee is still relatively affordable, making a living there can be a bit of a challenge, considering the state’s minimum wage is just $7.25. But thankfully, many of the non-essentials cost less than average in Tennessee:
- Average cost of a date night: $92.38 (US average: $116)
- Average price of a night at the movies: $9.50 (US average: $10.61)
- Average cost of a Big Mac: $4.11 (US average: $3.99)
- Average sales tax: 7% (US average: 5.09%)
Naturally, what constitutes comfortable living is different for every person. You can certainly live in Tennessee with less than $32,000, but that’s considered the baseline to cover the essential living expenses.
The Tennessee cities with the lowest cost of living
The great news about Tennessee? There are tons of affordable places to choose to set down roots. Below is a roundup of five different Tennessee towns and cities with cost of living indexes (COLI) below the state average of 87.6:
- Chattanooga(COLI: 83.5): Tennessee’s fourth-largest city is also one of its most affordable! Proximity to the University of Tennessee gives the city a bustling nightlife scene, while nearby state parks make for ideal weekend escapes.
- Clarksville(COLI: 85.6): Clarksville is a great choice for families; its public schools are extremely highly rated. Or for those looking for a new job! Clarksville is now home to an LG manufacturing plant and a Google data center.
- Johnson City(COLI: 82): Those looking for a smaller, tighter-knit community will feel right at home, adding to Johnson City’s 65,600-person population.
- Oak Ridge(COLI: 82.9): Oak Ridge is home to about 30,000 residents, many of whom are young professionals and families. Many Oak Ridge residents work for the U.S. Department of Energy at the Oak Ridge National Laboratory.
How to easily find home and auto insurance in Tennessee
Although the cost of living in Tennessee is still fairly low—every dollar still counts. You may not know it, but taking a minute to download
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FAQ
How much does it cost to live in Tennessee per month?
A single person needs at least $2,677 per month to live in Tennessee.
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