Cost of Living in Tennessee

By Jacqueline DeMarco

(Last Updated – 03/2025)

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 facts that the Volunteer State assesses no state income tax and has the tenth-lowest cost of living in the country are 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 10 most affordable states, at No. 10, according to MERIC data for 2024.

You could hop down to Mississippi (the fourth lowest cost of living among all 50 states and the District of Columbia), Alabama (fifth lowest), or Arkansas (sixth lowest), but Tennessee is more affordable than nearby states like Georgia, Kentucky, South Carolina, North Carolina, and Florida.

So what is the average cost of living in Tennessee? Total yearly personal consumption cost is $49,326, on average, according to the latest data from the Bureau of Economic Analysis. Here’s what you can expect to spend across major purchasing categories.

That translates to $4,111 in average monthly expenses for a Tennessean.

Housing Costs in Tennessee

Average Housing Costs in Tennessee: $1,110 to $1,932 per month

Considering that Tennessee is one of the cheapest states to live in, it comes as no surprise that the average home value is below the national average. Zillow calculated the average home value as $316,501 in March 2025.

The latest census data and other industry sources give an idea of Tennessee’s monthly housing costs:

•   Median monthly mortgage cost: $1,506

•   Median studio rent: $1,174

•   Median one-bedroom rent: $1,110

•   Median two-bedroom rent: $1,154

•   Median three-bedroom rent: $1,342

•   Median four-bedroom rent: $1,667

•   Median five-bedroom (or more) rent: $1,932

•   Median gross rent: $1,214

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 from March 2025.

Utility Costs in Tennessee

Average Utility Costs in Tennessee: $364 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.

Sources: U.S. Energy Information Administration, Electric Sales, Revenue, and Average Price; Inspirecleanenergy.com; DoxoInsights, U.S. Cable & Internet Market Size and Household Spending Report; and Rentcafe.com, What Is the Average Water Bill?

Groceries & Food

Average Grocery & Food Costs in Tennessee: $298 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 (nonrestaurant) food cost per person is $3,576, that’s about $298 per month.

The Council for Community and Economic Research, which ranks the food costs in major American cities, indexed Tennessee cities’ grocery costs for 2024, from lowest to highest.

Transportation

Average Transportation Costs in Tennessee: $10,319 to $19,201 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 2025 data from MIT’s Living Wage Calculator.

Health Care

Average Health Care Costs in Tennessee: $8,244 per person, per year

While the average annual per-person cost of health care in Tennessee is $8,244, according to the latest 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 the most recent data from CostofChildCare.org.

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 2025 State Individual Income Tax Rates and Brackets report.

Other states where residents don’t have to pay a state income tax are Alaska, Florida, Nevada, New Hampshire, Washington, South Dakota, Texas, and Wyoming.

Miscellaneous Costs

Once you’ve tackled all of the necessary expenses, it’s time to enjoy yourself. If estimated personal expenditures are $27,506 per year, here’s what some of that fun spending might be going toward (costs are accurate as of March 2025):

•  A family-friendly day for folks who love Dolly Parton and theme parks can be spent at Dollywood in Pigeon Forge: Tickets start at $92

•  Music lovers can soak up some history at the Country Music Hall of Fame in Nashville: Tickets start at $29.95 for adults

•  For even more music history, stop by Memphis’s Graceland, the former home of Elvis Presley: Entrance and tours start at $29 and go as high as $250

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 compare each state’s average cost of living and housing costs to the national averages, put Tennessee in 18th 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 2024.