What Is the Cheapest State To Live Full-Time in an RV?

This post contains affiliate links (I get a commission at no extra cost to you for purchases made through links in this post).

RVs offer a great deal of freedom and flexibility when it comes to travel and living arrangements. However, they can also be quite expensive to maintain. If you want to save money on your RV lifestyle, it is very important to choose the state you want to live in wisely.

The cheapest state to live full-time in an RV is South Dakota. The state has no sales and income tax, low vehicle registration fees, low driver’s license fees, and many affordable campgrounds and RV parks. It also has other boondocking-friendly factors that make it a top choice for full-time RVers.

In this article, I will explore the factors that make South Dakota the cheapest state to live in an RV. I will also look at some of the other most affordable states for RV living.

Contents hide

1 Why South Dakota Is the Most Affordable State for RV Living

1.1 No Sales Tax

1.2 No State Income Tax

1.3 Low Vehicle Registration Fees

1.4 No Annual State Vehicle Inspection

1.5 Affordable Vehicle Insurance

1.6 Low Driver’s License Fees

1.7 Cheap Campgrounds/RV Parks

2 Other Boondocking-Friendly States

Why South Dakota Is the Most Affordable State for RV Living

As far as RV living goes, South Dakota is one of the most affordable states in the country. This midwestern state has several things that make it ideal for those looking to save money on their RV lifestyle.

No Sales Tax

One of the most significant expenses associated with RV ownership is sales tax. While most states require you to pay some sales tax on your RV purchase, South Dakota has no sales tax. When you purchase an RV in the state, you’ll only have to pay a 4% excise tax, saving you thousands of dollars throughout your RV ownership.

A few other states don’t have a sales tax, but they generally make up for it with other forms of taxes and additional fees.

No State Income Tax

Income tax is among the many expenses associated with RV living. Fortunately, South Dakota has no state income tax, which can save you a significant amount of money each year.

Whether working full-time or living off of investments, you won’t have to worry about paying any state income tax in South Dakota. Since most other states have some income tax, choosing to live in South Dakota can be a significant advantage for those looking to save on their RV lifestyle.

Low Vehicle Registration Fees

Another significant expense associated with RV ownership is vehicle registration fees, which vary widely from state to state and can be costly in states with large populations like California.

Registering your RV in South Dakota can save you hundreds of dollars each year, which can go a long way towards offsetting the cost of your RV lifestyle. The rates are among the lowest in the US and are significantly lower than what you’d pay in most other states.

However, South Dakota requires that you establish residency in the state to register your RV. The good news is that this process is relatively easy and can be done in as little as one night.

All you need to do is stay at an RV park or campground in the state and provide proof of residency, such as a utility bill. Once you’ve done all that, you’ll be able to register your RV and save money on your annual registration fees.

No Annual State Vehicle Inspection

One of the most annoying things about owning an RV is having to go back each year to inspect your vehicle. Most states require some form of annual vehicle inspection, but South Dakota has no such requirement.

You can save yourself a lot of time and money by not having to get your vehicle inspected, which can be incredibly convenient if you live in a state requiring you to travel a long distance to inspect your vehicle.

Affordable Vehicle Insurance

While South Dakota has some of the lowest vehicle registration fees in the country, it also has some of the most affordable vehicle insurance rates. The state’s vehicle insurance rates are significantly lower than the national average and even lower than some other states that don’t have sales tax.

Florida, for example, has the highest vehicle insurance rates in the country, with an average rate of $2,560, as of 2022. South Dakota, on the other hand, has an average insurance rate of just $1,581. The difference in rates can save you significant money each year.

Low Driver’s License Fees

Driver’s license fees can also be a significant expense for those looking to save on their RV lifestyle. In South Dakota, driver’s license fees are reasonably low, and renewals only need to be done every 10 years, so you won’t have to worry about paying the fee too often.

Cheap Campgrounds/RV Parks

South Dakota is a beautiful state with plenty to offer regarding scenery and recreation and is endowed with over 50 RV parks and campgrounds that are both affordable and convenient. These parks offer a wide variety of amenities and are located in some of the most scenic areas in the state.

Some of the most popular RV parks in South Dakota include:

Custer State Park

Deadwood Gulch Resort
The KOA Campgrounds in Rapid City
Sioux Falls

These parks offer a significant range of activities, and what’s even better is that they’re all reasonably priced. You can easily find an RV site that fits your budget while enjoying all that South Dakota has to offer.

Even better, most of these state parks offer cheap or free camping for those traveling in an RV. This can save you significant money each year, as campground fees can add up quickly.

While all these factors don’t wholly offset living costs in an RV, they can make it more affordable. Living in an RV can be very expensive. Still, if you’re willing to live a simple lifestyle and take advantage of all that South Dakota offers, you can easily save a significant amount of money.

Other Boondocking-Friendly States

If you’re not set on South Dakota, a few other states offer a similar lifestyle at a fraction of the cost.

Texas

The Lone Star State has a lot to offer regarding scenery and recreation, and it’s also one of the most affordable states to live in full-time in an RV.

Some of the perks of living in Texas include no state income tax and low vehicle registration fees. Additionally, Texas is very RV-friendly, and you’ll find plenty of beautiful campgrounds and RV parks.

Florida

Despite its high insurance rates, Florida has a lot to offer in terms of affordability and convenience. The state has no income tax, which can save you a significant amount of money each year.

Additionally, Florida is a very popular retirement destination, so many healthcare options are available that are both affordable and convenient.

Mail forwarding services are also widely available in Florida, which can be a great perk for those who travel frequently. The state is also a very popular destination for RVers, so you’ll find plenty of campgrounds and RV parks that cater to your needs.

Conclusion

South Dakota is a great state for those looking to save money on their RV lifestyle. The reasonable driver’s license fees, cheap campgrounds, lack of state income tax, and other boondocking-friendly factors make it a desirable option for those looking to live full-time in an RV. Texas and Florida also offer a similar lifestyle at a fraction of the cost.

These states have no state income tax, low vehicle registration fees, and plenty of campgrounds and RV parks. Whichever state you choose, you can be assured that you can save a significant amount of money on your RV lifestyle.