Tennessee is brimming with country and blues culture that focuses on Nashville and Memphis. When it comes to the cost of living in the state, most costs are below the national average, but home prices can be high, depending on where you live. Residents also spend more than the national average on public services. If you're planning to move soon, you can work with a financial advisor to properly prepare your finances.
In much of Tennessee, health care costs are around the national average. According to a study by the Health Care Cost Institute, prices in the Nashville metropolitan area are 7% above the U.S. average. In the United States, while in the Chattanooga metropolitan area they are 4% below that mark.
The main outlier in the state is Knoxville, which has prices that are 16 percent lower than the national median. Tennessee's state tax system has been rated as the most regressive in the nation. A study conducted by Federal Reserve economists revealed that Tennessee's tax regime offsets 32.7% of the progressivity of the federal tax code. In other words, the federal tax system aims to get the richest people to pay a higher percentage of their income in taxes.
However, if you add Tennessee's state taxes, the inequality-compressing effect of the federal tax system is reduced by 32.7%. There are no state income taxes in Tennessee. Tennessee's sales tax ranges from 8.5% to 9.75%, depending on which county you shop in. Therefore, although the state's base sales tax is 7%, counties impose additional rates that range from 1.5% to 2.75%.
Tennessee has traditionally been one of the most affordable states in the U.S. UU. to live in general, but real estate costs have increased dramatically in recent years. University enrollment hasn't increased much recently and there are no state income taxes.
After all, it could be a great place to live, but you need to plan ahead and consider all the costs. Do you have any questions? Ask our homebuying expert. An award-winning writer with more than two decades of experience in real estate.