Can you survive on $40,000? You can in these 10 cities!


Median household income in the U.S. was $56,516 in 2015, according to the most recent Census numbers.

But what if you’re living on less than that? How about $40,000 annually? That’s more than 25% less than the median income!

Could you live on that amount of money? Is it even possible?

Read more: 5 lessons from a man who retired at 33

10 cities where you can live comfortably on $40K or less

First off, the resounding answer to those questions is ‘Yes, it is possible!’ There are a number of U.S. cities where you can live to stretch a buck and still enjoy a great quality of life.

AARP partnered with Sperling’s Best Places to determine the best cities to live on $40,000 or less. Cities were assessed based on their housing affordability, access to work and recreation, transportation, healthcare and safety. Once those numbers were crunched, each city was assigned a livability index number. An index number of 50 or greater was required to make the following list:

Sheboygan, Wisconsin

  • Livability index: 65
  • Population: 115,300
  • Median housing price: $127,300
  • Sunny days per year: 188

Eugene, Oregon

  • Livability index: 59
  • Population: 358,300
  • Median housing price: $222,000
  • Sunny days per year: 155

Cleveland, Ohio

  • Livability index: 56
  • Population: 2 million
  • Median housing price: $124,000
  • Sunny days per year: 166

Fort Walton Beach, Florida

  • Livability index: 55
  • Population: 258,000
  • Median housing price: $208,200
  • Sunny days per year: 226

Abilene, Texas

  • Livability index: 51
  • Population: 168,600
  • Median housing price: $106,500
  • Sunny days per year: 243

Bristol, Virginia and Tennessee

  • Livability index: 56
  • Population: 308,000
  • Median housing price: $115,000
  • Sunny days per year: 201

Cheyenne, Wyoming

  • Livability index: 58
  • Population: 96,400
  • Median housing price: $191,800
  • Sunny days per year: 236

Cañon City, Colorado

  • Livability index: 54
  • Population: 16,300
  • Median housing price: $146,700
  • Sunny days per year: 250

Rochester, New York

  • Livability index: 58
  • Population: 1.08 million
  • Median housing price: $126,600
  • Sunny days per year: 165

Sioux Falls, South Dakota

  • Livability index: 66
  • Population: 248,400
  • Median housing price: $202,000
  • Sunny days per year: 211

Help! There’s never enough money in my life! What should I do?

Now to the bigger question: How can you prepare for your future when you are earning $40,000 or less?

It all starts with paying yourself first. That means deducting money from your paycheck for savings and investment in your future before paying any other monthly bills. If you have a 401(k) at work, start saving money through automatic withdrawals each time you get paid.

If you’re saving nothing right now, start small. Here’s Clark’s formula: Begin by saving one penny out of every dollar you make. That’s just 1% of your income. Then every six months, step it up by one more penny. In five years you’ll be saving 10%—before any possible company match—and you’ll change your future. See Clark’s investment guide for help getting started.

And then if you need to, go to cash. No more plastic. No more reward cards. Just pay cash. And we don’t mean a debit card, either. We’re talking about actual green money. On payday, take out your money and that’s what you live on until next payday.


The psychological effect of seeing your wallet thin out as the week goes by has the effect of helping you live within the means of what you’re earning!

Read more: 5 financial lessons from the life of a librarian with a $4 million net worth

The steps one man took to retire at 33

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