Geo-Arbitrage: 10 US Cities Where You Can Retire Early on Less

On the path to Financial Independence, Retire Early (FIRE), we often focus on two main levers: saving more and earning more. But there is a third, incredibly powerful lever that can dramatically accelerate your journey: spending less by changing where you live. This is the power of geo-arbitrage, and it might be the single most effective strategy for reaching your FIRE goals years, or even decades, sooner.

The concept is simple: earn your money in a high-cost-of-living (HCOL) area and then move to a low-cost-of-living (LCOL) area to make that money go significantly further. By strategically relocating, you can slash your biggest expenses—housing, taxes, and transportation—and drastically reduce the size of the nest egg you need to retire. This isn't about deprivation; it's about using geography to your financial advantage.

This guide will explore the powerful concept of geo-arbitrage, show you how it can impact your FIRE number, and reveal 10 amazing U.S. cities where you can retire early on less, without sacrificing a high quality of life.

What Is Geo-Arbitrage and How Does It Work?

Geo-arbitrage is the practice of taking advantage of the price differences between two geographic locations. In the context of FIRE, it most often means relocating from an expensive city like New York or San Francisco to a more affordable city where your savings and investment income can support a much higher standard of living.

The impact this can have on your FIRE plan is staggering. Remember, your FIRE number is based on your annual expenses. As we cover in "How to Calculate Your FIRE Number," the basic formula is:

Annual Expenses x 25 = Your FIRE Number

Let's see how geo-arbitrage affects this calculation:

• Scenario A: Retiring in a HCOL City (e.g., San Diego, CA)

• Estimated Annual Expenses: $90,000

• FIRE Number: $90,000 x 25 = $2,250,000

• Scenario B: Retiring in an LCOL City (e.g., Omaha, NE)

• Estimated Annual Expenses: $50,000

• FIRE Number: $50,000 x 25 = $1,250,000

By simply changing your location, you have reduced your FIRE number by $1,000,000. This could shave a decade or more off your working career. This is the mathematical magic of geo-arbitrage.

How Did We Choose These 10 Cities?

This isn't just a list of the cheapest places in America. A successful FIRE destination needs more than just a low cost of living. It needs to be a place you'd actually want to live. Our criteria for this list include:

• Low Cost of Living: A score significantly below the national average of 100, with a particular focus on housing costs. (Data sourced from platforms like PayScale's Cost of Living Calculator).
• High Quality of Life: Access to amenities like parks, restaurants, cultural attractions, and community events.
• Good Healthcare: Access to quality hospitals and medical facilities.
• A Thriving Community: A place with a growing economy and a vibrant community feel, not just a sleepy town.

With that in mind, here are 10 U.S. cities perfect for your geo-arbitrage strategy.

10 US Cities Where You Can Retire Early on Less

(Note: Cost of living data is subject to change. All figures are approximate and intended for comparison.)

1. Omaha, Nebraska

• Cost of Living Index: ~89
• Why it's great for FIRE: Don't sleep on Omaha. Home to billionaire investor Warren Buffett, who famously still lives in the modest home he bought in 1958, Omaha offers an incredibly low cost of living with the amenities of a much larger city. It has a thriving food scene, a beautiful riverfront, and a friendly, unpretentious culture. The median home price is often less than half of the national average.

2. Chattanooga, Tennessee

• Cost of Living Index: ~84
• Why it's great for FIRE: Nestled in the Appalachian Mountains, Chattanooga is an outdoor lover's paradise with world-class hiking, rock climbing, and kayaking right on its doorstep. It also boasts the fastest internet in the country ("Gig City") and has a burgeoning tech and arts scene. Plus, Tennessee has no state income tax, which is a massive bonus for early retirees.

3. Huntsville, Alabama

• Cost of Living Index: ~85
• Why it's great for FIRE: Known as "The Rocket City" for its deep ties to NASA and the U.S. space program, Huntsville is a hub of engineering and technology. This means it has a highly educated population and a stable, high-tech economy, but with a cost of living that is remarkably low. It offers a unique blend of Southern charm and scientific sophistication.

4. Kansas City, Missouri

• Cost of Living Index: ~87
• Why it's great for FIRE: Forget what you think you know. Kansas City is a vibrant cultural hub, famous for its world-class barbecue, live jazz music, and more fountains than any city besides Rome. It has beautiful architecture, numerous free museums, and a passionate sports culture. You get a rich, big-city cultural experience for a small-town price.

5. Greenville, South Carolina

• Cost of Living Index: ~90
• Why it's great for FIRE: With a stunningly beautiful and walkable downtown built around a waterfall, Greenville has become a major destination in the Southeast. It has a booming economy with major companies like BMW and Michelin, a foodie scene that gets national attention, and easy access to the Blue Ridge Mountains.

6. Des Moines, Iowa

• Cost of Living Index: ~88
• Why it's great for FIRE: Often ranked as one of the best places to live in the U.S. for its strong job market, affordable housing, and high quality of life. Des Moines has a surprisingly vibrant downtown, a growing craft brewery scene, and over 800 miles of recreational trails. It's a practical, comfortable, and affordable place to build a life.

7. Fayetteville, Arkansas

• Cost of Living Index: ~86
• Why it's great for FIRE: Located in the beautiful Ozark Mountains, Fayetteville is a lively college town (home to the University of Arkansas) with a youthful energy. It offers a fantastic arts and music scene, great farmers' markets, and endless opportunities for outdoor recreation. It consistently ranks as one of the best places to live in the nation.

8. Richmond, Virginia

• Cost of Living Index: ~95
• Why it's great for FIRE: While slightly more expensive than others on this list, Richmond offers an incredible value proposition. It's a city steeped in American history with stunning architecture, a nationally recognized food and craft beer scene, and a vibrant arts community. It's just a two-hour drive from both Washington, D.C., and the beaches of the Atlantic, offering the perfect balance of affordability and access.

9. Buffalo, New York

• Cost of Living Index: ~89
• Why it's great for FIRE: Buffalo is undergoing a major revitalization. Known for its incredible architecture, friendly people (the "City of Good Neighbors"), and proximity to Niagara Falls, it offers big-city amenities at a fraction of the cost of other Northeast cities. The housing stock is famously affordable, and the four-season climate is perfect for those who enjoy true winters.

10. Indianapolis, Indiana

• Cost of Living Index: ~89
• Why it's great for FIRE: As a major state capital and host of the world-famous Indy 500, Indianapolis is a large, dynamic city that remains surprisingly affordable. It has a walkable downtown core, a growing tech sector, and a low cost of living that makes it possible to pursue a comfortable "ChubbyFIRE" lifestyle on a relatively modest nest egg.

How Do You Choose the Right Geo-Arbitrage City for You?

Reading a list is one thing; making a life-changing move is another. How do you narrow down the options?

1. Prioritize Your Values: What is most important to you in a place to live? Is it access to mountains, a specific political climate, proximity to family, or a vibrant arts scene? Make a list of your top 5 "must-haves."
2. Do a "Boots on the Ground" Visit: Never move to a city you haven't visited. Spend at least a week there, but not as a tourist. Go to the grocery store, drive around during rush hour, visit different neighborhoods, and talk to locals. Try to imagine your daily life there.
3. Consider the Tax Implications: State taxes can have a huge impact on your retirement income. States with no income tax (like Tennessee) are very attractive, but you should also look at property taxes and sales taxes to get the full picture. A resource like the Tax Foundation provides excellent state-by-state comparisons.
4. Think About Community: How will you build a new social circle? Look for cities with active community groups, volunteer opportunities, or clubs centered around your hobbies. This is crucial for a happy retirement.

Conclusion: Your Address Is One of Your Biggest Assets

The power of geo-arbitrage demonstrates that your location is one of the most significant financial assets you have. By being flexible about where you live, you can fundamentally change your financial equation, making early retirement more achievable than you ever thought possible.

The journey to FIRE is about making intentional choices that align with your goals. For many, the most impactful choice they can make is to trade a high-cost address for a city that offers a high quality of life at a fraction of the price. The American dream of a comfortable retirement is still alive and well—you just might find it in a city you never expected.

Now, it's your turn to think about location: If you could move anywhere in the U.S. to accelerate your FIRE journey, what kind of place would you choose? Would you prioritize mountains, the city, the coast, or proximity to family?

Share your ideal retirement location criteria in the comments below! Your dream spot might be one that another reader hasn't even considered.