(Last Updated – 03/2023)
If you enjoy sunny days but also want to experience all of the seasons (no shade meant toward California), then you’ll appreciate the fact that Tennessee has about 207 sunny days a year, two more days than the national average.
The mild weather in Tennessee (the state gets about 5 inches of snow per year, compared with the U.S. average of 28 inches) is just one of the draws. The fact that the Volunteer State assesses no state income tax and has the tenth-lowest cost of living in the country is also appealing.
What is the cost of living in Tennessee? Keep reading to find out.
What’s the Average Cost of Living in Tennessee
Average Cost of Living in Tennessee: $42,469 per year
If you’re planning to move to Tennessee, your monthly budget might get a nice break. Why? Tennessee is among the most affordable 10 states, at No. 10, according to MERIC data gathered in 2022.
You could hop down to Mississippi (the lowest cost of living among 50 states and the District of Columbia), Alabama (fourth lowest), or Georgia (fifth lowest), but Tennessee is more affordable than nearby states like Arkansas, Kentucky, South Carolina, North Carolina, and Florida.
So what is the average cost of living in Tennessee? Total yearly personal consumption cost is $42,469, on average, according to 2021 data from the Bureau of Economic Analysis . Here’s what you can expect to spend across major purchasing categories.
Category | Average Annual Per-Capita Cost in Tennessee |
Housing and Utilities | $7,303 |
Health Care | $6,946 |
Food and Beverages (non-restaurant) | $3,016 |
Gas and Energy Goods | $1,152 |
All Other Personal Expenditures | $24,051 |
That translates to $3,539 in average monthly expenses for a Tennessean.
Housing Costs in Tennessee
Average Housing Costs in Tennessee: $828 to $1,477 per month
Considering that Tennessee is one of the cheapest states to live in, it comes as no surprise that the average home price is on the lower side. Zillow calculated the typical home value as $291,334 in February 2023.
The latest census data from 2021 gives an idea of what to expect housing costs to look like in Tennessee on a monthly basis:
•Median monthly mortgage cost: $1,337
•Median studio rent: $828
•Median one-bedroom rent: $894
•Median two-bedroom rent: $944
•Median three-bedroom rent: $1,087
•Median four-bedroom rent: $1,320
•Median five-bedroom (or more) rent: $1,477
•Median gross rent: $981
To get a clearer picture of what the Tennessee housing market is like, these are typical home values in 20 major Tennessee cities, according to Zillow data sourced in January 2023.
Tennessee City | Typical Home Price |
Nashville(Nashville Housing Market Trends) | $420,932 |
Memphis | $225,958 |
Knoxville | $298,064 |
Chattanooga | $261,693 |
Clarksville | $252,675 |
Kingsport | $196,912 |
Johnson City | $221,781 |
Jackson | $168,846 |
Morristown | $232,800 |
Cleveland | $250,841 |
Cookeville | $252,617 |
Tullahoma | $257,720 |
Sevierville | $401,987 |
Greeneville | $187,970 |
Crossville | $258,090 |
Athens | $209,750 |
Shelbyville | $278,978 |
Lawrenceburg | $199,405 |
McMinnville | $207,580 |
Dyersburg | $128,894 |
Utility Costs in Tennessee
Average Utility Costs in Tennessee: $389 per month
While not the most exciting expenses, utilities are a necessary one you’ll have to finance every month. Here’s what utilities tend to cost on a monthly basis in Tennessee.
Utility | Average Tennessee Bill |
Electricity | $131 |
Gas | $101 |
Cable & Internet | $121 |
Water | $36 |
Sources: U.S. Energy Information Administration, Electric Sales, Revenue, and Average Price, 2021; Inspirecleanenergy.com; DoxoInsights, U.S. Cable & Internet Market Size and Household Spending Report 2022; and Rentcafe.com, What Is the Average Water Bill?
Groceries & Food
Average Grocery & Food Costs in Tennessee: $251 per person, per month
A major contributor to your cost of living will be your grocery spending. So how much might you spend on food if you move to Tennessee?
If Tennessee’s average annual (non-restaurant) food cost per person is $3,016, that’s about $251 per month.
The Council for Community and Economic Research , which ranks the food costs in major American cities, ranked Tennessee cities’ grocery costs for 2022, from lowest to highest.
Tennessee City | Grocery Items Index |
Knoxville | 89.9 |
Memphis | 91.9 |
Jackson | 93.0 |
Maury County | 93.6 |
Cookeville | 94.1 |
Chattanooga | 96.5 |
Nashville | 97.5 |
Morristown | 98.1 |
Transportation
Average Transportation Costs in Tennessee: $5,477 to $15,530 per year
Going to and fro can add up, especially if you have a big family. This is a basic breakdown of how annual transportation costs can vary based on family size in Tennessee, according to 2023 data from MIT’s Living Wage Calculator .
Family Makeup | Average Annual Transportation Cost |
One adult, no children | $5,477 |
Two working adults, no children | $9,851 |
Two working adults, three children | $15,530 |
Health Care
Average Health Care Costs in Tennessee: $6,946 per person, per year
While the average annual per-person cost of health care in Tennessee is $6,946, according to the 2021 Bureau of Economic Analysis report, what you will actually spend on health care may look very different.
Health care spending is determined by location, medical needs, and coverage.
Child Care
Average Child Care Costs in Tennessee: $899 to $1,398 or more per child, per month
No matter what state you live in, child care is often a big expense.
Tennesseans may get help with the costs through the Smart Steps program .
Want to estimate your child care budget? Here are average monthly child care costs in Tennessee, according to 2021 data from costofchildcare.org .
Type of Child Care | Average Cost Per Month, Per Child |
Infant Classroom | $1,398 |
Toddler Classroom | $1,099 |
Preschooler Classroom | $899 |
Home-based Family Child Care | $939 |
Taxes
Highest Marginal Tax Rate in Tennessee: None
Most states and the District of Columbia charge an income tax, but Tennessee does not, according to the Tax Foundation’s State Individual Income Tax Rates and Brackets for 2023 .
Residents also don’t have to pay a state income tax in Alaska, Florida, Nevada, New Hampshire, Washington, South Dakota, Texas, or Wyoming.
Miscellaneous Costs
Once you’ve tackled all of the necessary expenses, it’s time to enjoy yourself. If estimated personal expenditures are $24,051 per year, here’s what some of that fun spending might be going toward (costs are accurate as of March 2023):
•A family-friendly day for Dolly Parton and theme park lovers can be spent at Dollywood in Pigeon Forge: Tickets start at $89
•Music lovers can soak up some history at the Country Music Hall of Fame in Nashville: Tickets start at $27.95 for adults
•For even more music history stop by Graceland in Memphis, the former home of Elvis Presley: Entrance and tours start at $28 and go as high as $215
How Much Money Do You Need to Live Comfortably in Tennessee?
We all have our own idea of what it means to live “comfortably.” Your family size, income, lifestyle, and location can all influence how accessible a comfortable style of living is.
But to give you an idea of how easy it is to live in Tennessee, U.S. News & World Report’s Affordability
Rankings , which measure the average cost of living in a given state against the average household income, put Tennessee in 17th place.
Remember that MERIC views the cost of living in Tennessee even more favorably, finding the state to have the tenth-lowest cost of living in the country.
What City Has the Lowest Cost of Living in Tennessee?
If you’re eager to make a move to Tennessee but are on a budget, you’ll want to find the right spot to call home. These are the three major cities with the lowest cost of living, according to the Council for Community and Economic Research’s Cost of Living Index for the second quarter of 2022.
Knoxville
With a cost-of-living index of 84.9, Knoxville is the most affordable major Tennessee city to live in, the council found. From museums to nightlife to fine dining, Knoxville offers a lot of bang for the buck.
Jackson
Next up is Jackson, with a cost-of-living index of just 86.1. You’ll hear Jackson referred to as Hub City. This city is located between Memphis and Nashville, which means you’ll have access to big-city amenities. Jackson is known for being the home of rockabilly, so get ready to meet lots of music lovers.
Memphis
The third-most affordable city in Tennessee is Memphis, with a cost-of-living index of 87.2. This city is famous for its barbecue. You may want to make room in your budget for checking out beloved restaurants like A&R Bar-B-Que and the Bar-B-Q Shop.
