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Cheapest States To Raise Kids

cheapest places in the US to raise kidsAsk 50 people their opinion about the best places to raise kids and you might get 50 different answers. Some people would lop off their left arm before leaving one of the coasts for the Midwest. Most Southern people I know would not move west of the Mississippi if they were offered a million dollars. Looking from a purely financial viewpoint, lets look at some of the cheapest states to raise kids.

New Mexico

Ah, the Land of Enchantment! I used to live in New Mexico and we currently reside only 40 miles from the border, so I’ve had some first hand experience with this state. To be honest, there are some armpit worthy parts of New Mexico. The state has a high teen pregnancy rate, lots of poverty, and was ranked as one of the worst economies in the US last year. Why on earth would anyone choose to live in New Mexico?

Despite those disappointing statistics, New Mexico is not all that bad, IF you look at certain areas of the state. Research, health care, aerospace, energy, and technology jobs are available. New Mexico offers very lucrative tax incentives for businesses. That’s why Virgin Galactic, Intel, and many Hollywood movie productions love doing business there.

As far as places to live, scientific minded Los Alamos has very strong schools, low housing prices relative to salaries, and 62 percent of it’s residents hold a bachelor’s degree or higher. Santa Fe has multiple cultural and artistic avenues. Albuquerque suburb, Rio Rancho, has a low cost of living and great schools. Most of New Mexico has access to amazing recreational activities.

New Mexico has some of the lowest property taxes in the country and offers high school students help with college in the form of the Legislative Lottery Scholarship. It is not based on financial need. All kids have to do is maintain a 2.5 GPA after their first semester. Not bad at all!

Texas

Texas is one of seven states that doesn’t collect state income tax, although they do try and make up for it with higher than average property taxes. Regardless, the economy in Texas continues to grow while cost of living remains low relative to salary.

Towns like Frisco and McKinney near Dallas and The Woodlands near Houston rank  high as far as schools, household income, and affordable housing. Day care costs in Texas are also less than in other major cities. At $694 per month for infant care, it’s not cheap, but much less than in places like New York ($1137/month) or Massachusetts ($1248/month).

Mississippi

OK, Mississippi has some big flaws. It ranks worst in the nation as far as schools, health, and income. The good news is that just about everything in Mississippi is cheap! You can live pretty large on a $50,000 annual salary.

Mississippi is not all bad. either. I have a good friend who lives in Olive Branch, MS, where the annual family income is around $70,000 a year. It’s only about 20 minutes from Memphis, where there are tremendous music and art festivals all the time. She can afford to send her kids to private school, well, because tuition is much cheaper in Mississippi than other places. While hot in the summer, other seasons are mild. Her children are involved in dance, sports, and they are only a few hours drive from the Gulf Coast.

Any State Is The Best State If You Make It One

While I only looked at three of the cheapest places, a pretty good argument can be made that any place, despite rankings or polls, can be a great place to raise kids. While dollars go much further in the Midwest and Southern US, that part of the country often lacks as far as overall quality of schools, culture, diversity, and access to really high salaries. Living in very expensive places like Manhattan or Los Angeles might mean better access to those things, but less of a chance at home ownership or being able to save for college. It’s all about what you value.

For our family, we were pretty much established before the thought of having a kid. While Southwest Colorado isn’t ideal in some ways, we have more positives than negatives, and that’s why we stay. If prospective parents know their current salary and location does not support the kind of lifestyle they want for having children, it might be worth taking a look at one of the cheapest states to raise kids.

Why do you live where you do? Did having kids influence your decision?

 

Image: Freedigitalphotos.net/anankkml

About Kim Parr

Kim Parr is a private practice optometrist, freelance writer, and personal financial blogger. You can follow her journey to 20/20 financial vision at Eyes on the Dollar.

25 comments

  1. We live in the DFW area. I have family here and that’s mainly why we moved. We were in Seattle and Denver (still own a home there) prior to moving. Yes, our home here is 3 times bigger than what we had in Denver (for about the same price), but our property taxes here are almost 3 times as much as what we pay in Denver.
    And for some reason, ice hockey (both of our teens play) is twice what we paid in Seattle and Denver. Go figure! My husband is from Alamosa. Sure miss those RockyMountains!

  2. We moved to the suburbs because our just for two house was in the worst school district in the city. My Mr. has never lived outside this city, we’re in Ottawa, and I’m not sure he ever will!

    • We did not consider school districts when we built our house because we didn’t have kids then! Thankfully, we are allowed to enroll out of district as the elementary school that our daughter is supposed to attend is not very good at all.

  3. As you know, we live in Omaha and it is relatively cheap for us. Well, at least in comparison to our other main option – San Diego. I think if it were just Nicole and I we’d likely still be in San Diego, but the cost of living is high there and part of the reason why we chose to move was to be in a lower cost of living city. That said, I think much of it comes down to choices and choosing to live in a way that’s financially balanced.

    • Omaha ranks pretty high on several of the lists of family friendly towns I studied. I’ve never been to Nebraska, but I feel the need to check it out if for no other reason than Warren lives there.

  4. I live in Texas and our schools are VERY hit and miss….the three communities you list are good, but others are absolutely horrible. Plus, we do things like rewrite history here and build huge football stadiums that never fill up with people. There’s lots of it that I just don’t get…..

  5. Oh man you couldn’t pay me to live in Mississippi. I hope I didn’t offend anyone by saying that. 🙂 But then again, not that I’ll have kids, but to raise kids in California it must cost a FORTUNE!

    • I did quite a bit of research for this topic, and it’s funny that some cities in California, like San Jose, were ranked as cheaper for families than places like Cleveland. The theory is that incomes are so high, you can afford things easier than a place with low salaries. I’m sure that’s true for many, but for everyone making $350K per year, you have teachers, social workers, and general laborers who might make a pretty good salary for their occupation but still struggle with taxes and housing.

      I actually loved my time in Memphis and I could live there if I had to live in the South, but its really not my thing anymore. I also really like Oxford, where Ole Miss is located. I think any college town can make a crappy state not so bad.

  6. Well, I definitely knew New York was not going to be on this list! 🙂 We could have lived cheaper in other parts of the country; however, we chose to raise our son in New York because we wanted him to be exposed to the arts, and various cultures. For us, this was worth the expense but like anything with kids you have to balance the pros and cons of any living situation.

    • No, that one wasn’t on any cheap lists I could find, but I do envy all the free or low cost entertainment and cultural activities you have nearby. I also am jealous of the public transportation.

  7. I think it becomes more and more affordable the longer you put off having kids, regardless of where you live. I have no plans of moving to a lower cost of living State, so I don’t really factor in how cheap or expensive a place is to live. But I also don’t have kids nor have I ever been given a great job opportunity to live elsewhere…I suppose circumstances can always change perspectives.

    • I think that’s true. Even if you have kids very young and are still young when they are adults, you would still probably try and help them with college or getting established. The only time you know you won’t spend on the kids is before you have them.

  8. I think you’re absolutely right that anywhere you live is what you make of it. That being said, for our next move, it made sense to us to do a lot of research in advance since we have the luxury of time to plan. We’re really pleased with everything we’ve learned about Vermont thus far and I’d feel comfortable buying a homestead there as soon as we find a property we like. I hope it’ll be good for our future kids, though it’ll definitely be a more rural experience for them than Cambridge would be! Hopefully they enjoy the woods 😉

    • I think rural is the way to raise a kid, as long as you let them have experience in cities and other types of geography. I grew up in a small town, which was great in some ways, but we never got to experience anything outside of small town life. I still sometimes struggle with places that are different from what I am familiar with. We hope our daughter never had that fear of the unknown while enjoying all the open space and safety of the small town where we live.

  9. We live in Indiana because I grew up here. I was once annoyed by the idea of living here, but it has really grown on me over the years! I don’t like enduring winter, but Indiana is a safe and beautiful place to live in spring, summer, and fall. Very affordable too.

  10. We live in the Midwest mostly because our families are here and because of the variety of the four seasons (although one of them, which shall remain nameless, isn’t my favorite. 🙂 ) Ironically though, after sharing with my husband and kids about the wonderful weather and other things in CO, he actually suggested moving there. 🙂

    • I like living in Colorado better than anywhere I’ve ever lived. This winter had been exceptionally warm for our area. We’ll pay for it later when we have no water this summer, but it’s been very pleasant to say the least.

  11. Having just moved from Texas, where we paid for infant day care, I don’t have the foggiest where that statistic was contrived. We paid FAR more than that! But all in all, I think Texas is a good place to live. We moved north of the Red River for a job. Unfortunately, employment still dictates our living location. But we are anxiously awaiting FI where we get to make that decision for ourselves!

    • It was a list the Huffington post derived. I’m sure day care varies wildly depending on where you live. I can’t wait until it doesn’t matter where I live. We’ll probably stay where we are, but it’s nice to have options.

  12. We are going with… d) None of the above

    Our current plan is to raise GCCjr around the globe while homeschooling

    (Don’t know how that will work yet, but we will give it a shot!)

    • I think that is a wonderful idea and if I had my whole career to do over again from age 20, I’d probably do the same thing.

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