Here’s How Much Millennials Can Save by Moving From NYC to the South
Written by
Angela Mae
Edited by
Chris Cluff
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It’s not exactly a secret that New York City is expensive. In fact, it’s one of the most expensive places to live in the United States. The average rental costs nearly $4,000 a month — and that’s for only 604 square feet of living space. Property taxes are high and the state’s income tax rate ranges from 4% to 10.9% — this, of course, is on top of federal income taxes.
New York City isn’t the only city in the state that’s expensive either. According to the Missouri Economic Research and Information Center, the only areas in the U.S. that are more expensive to live in are Alaska, Massachusetts, D.C. and California. The overall cost of living index in NY is also 123.1 — weighed against a national average of 100 — with everything from groceries to housing to utilities being more expensive than the rest of the country.
This is just part of the bigger picture. For those who want to save money, moving to the South is a much more financially sound option — especially for millennials who are still building up their careers and families.
Here’s how much millennials can save by moving south.
Also see where millennials want to retire.
Housing Is Far More Affordable in the South
While there are sure to be some exceptions, finding affordable housing is much easier to do in the South compared to The Big Apple.
“Everyone knows that NYC is an extremely expensive housing market — the most expensive in the country, in fact. As housing is a necessity, that means it can be super difficult for people, especially younger generations, to save much money while living there,” said Seamus Nally, CEO of TurboTenant.
“So, moving to the South, where in many places the cost of housing is a mere fraction of what it is in NYC, millennials can absolutely save money. The key is to choose housing wisely,” Nally continued. “A lot of people in situations like these will move into a much larger home that is similar to their NYC housing budget because they are used to spending that much and now they can get way more space.”
Having more space sounds great, but if you’re spending the same amount, you’re not doing yourself any favors financially.
A recent GOBankingRates study found that the average monthly mortgage payment in New York City hovers at around $4,620. In comparison, here’s what it looks like in some Southern cities:
- Clarksdale, MS — $262
- Forrest City, AR — $387
- Falfurrias, TX — $363
- Blytheville, AR — $459
- Greenville, MS — $405
- Lake Providence, LA — $346
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Even in more expensive areas, the monthly mortgage payment is still significantly lower in most Southern cities. Here are some statistics from the recent data:
- Peachtree Corners, GA — $3,418
- North Miami Beach, FL — $3,109
- Holly Springs, NC — $3,497
Don’t Forget the General Cost of Living
Housing is a definite consideration when choosing where to live and save money, but the South has NYC beat in terms of overall cost of living and even taxes.
“States like Florida and Texas also attract millennials due to the no-state income tax sweet deal, a feature that can amplify savings considerably,” said Kris Mullins, CMO of Capital Max. “Add on top of that the general affordability of living, from groceries to utilities.”
The potential savings opportunities in the South really can’t be understated. And with those savings comes the ability to afford a more comfortable lifestyle — without having to be quite as frugal (though it doesn’t hurt to find ways to save money). The lower cost of living also makes it easier for millennials and other such individuals to work toward their bigger financial goals — like paying off student loans, investing or building a nest egg for retirement.
But here’s a little context for the overall cost of living. In NYC, the average person spends around $7,399 a month on all things — including housing. Here’s what people spend in some Southern cities (according to GOBankingRates’ data):
- Jackson, MS — $2,109 a month ($5,290 less than NYC)
- Bellevue, KY — $3,220 a month ($4,178 less than NYC)
- Cary, NC — $5,664 a month ($1,735 less than NYC)
- Rogers, AR — $3,799 a month ($3,600 less than NYC)
- Jacksonville Beach, FL — $5,819 a month ($1,579 less than NYC)
Child Care Costs Can Be Hefty, Too
Right now, millennials are in their late 20s up to early 40s, meaning many are at that age where they’re either starting a family, thinking about it or already have young kids. Aside from those who have something worked out with their partners or other family members, this means an additional cost consideration.
“For millennials with young children, child care costs can be a significant financial burden,” said Justin Haywood, president and co-founder of Haywood Wealth Management. “The South typically offers more affordable child care options compared to NYC.”
According to Haywood, families could save thousands of dollars a year on child care in Southern cities compared to New York City.
Income a Key Consideration
Location aside, income is a huge consideration when choosing where to live. Despite its overall higher cost of living, the minimum wage in New York City is just $16. This is higher than what many Southern states offer, but the lower costs and potential job opportunities in these areas could offset that — particularly for those who earn more than the minimum regional wage.
The household median income in NYC is $76,607. In the South, it ranges from as low as $19,238 (in Prairie View, Texas, where the average monthly cost of living is $3,112) to $211,522 (in Heath, Texas, where the average monthly cost of living is $6,386).
This means that, while incomes might not always be enough in the South, there’s potential. Plus, as Mullins pointed out, many Southern cities have growing job markets — particularly in tech, finance and healthcare.
Annual Savings Opportunities in the South
The South is a big place, so it’s not quite fair to say that every city will be significantly cheaper than NYC. That said, millennials — and others looking for a lower cost of living — could save quite a lot by making the move.
Here are 10 Southern cities with the lowest annual cost of living compared to NYC:
- Clarksdale, MS — $22,692 a year ($66,096 less than NYC)
- Forrest City, AR — $23,496 a year ($65,290 less than NYC)
- Falfurrias, TX — $23,952 a year ($64,836 less than NYC)
- Blytheville, AR — $24,180 a year ($64,606 less than NYC)
- Greenville, MS — $24,336 a year ($64,444 less than NYC)
- Lake Providence, LA — $24,408 a year ($64,376 less than NYC)
- McGehee, AR — $24,528 a year ($64,253 less than NYC)
- Selma, AL — $24,684 a year ($64,107 less than NYC)
- Hope, AR — $24,792 a year ($63,989 less than NYC)
- Frederick, OK — $24,804 a year ($63,987 less than NYC)
Methodology: For this study, GOBankingRates analyzed cities in the Southern United States to find how much a millennial can save by moving from New York City to a city in the South. The Southern United States includes AL, AR, DC, DE, FL, GA, KY, LA, MD, MS, NC, OK, SC, TN, TX, WV. For each city, total population, total households and household median income were all sourced from the U.S. Census American Community Survey. The cost of living indexes were sourced from Sperling’s BestPlaces. Using the national average expenditure costs for the population born between 1981 and 1997, as sourced from the Bureau of Labor Statistics 2022 Consumer Expenditure Survey, the average expenditure costs for each city were calculated. Using the Zillow Home Value Index, the average home value for single family homes in May 2024 was sourced. Using the national average 30-year fixed mortgage rate, as sourced from the Federal Reserve Economic Research, the average mortgage cost was calculated for each city. Using the average mortgage and the average expenditure cost, the total cost of living was calculated for each city. The same data and procedures were completed for New York City and, using the final cost of living, the difference in total cost of living for each city to New York City was calculated. Any city with data not available was removed for this study. The livability index was sourced from AreaVibes for each remaining city. The livability index was scored and weighted at 1.00, the household median income was scored and weighted at 1.00, and the difference in cost of living from NYC was scored and weighted at 2.00. All the scores were summed and sorted to show the amount millennials can save by moving from NYC to a city in the Southern United States. All data was collected on and is up to date as of July 1, 2024.
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