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Rural communities in the American Midwest have experienced upheaval since the 1980s with shrinking populations, an exodus of younger people, job losses, and aging infrastructure. Evidence shows that these trends are unlikely to be reversed in most places. Despite this, high-cost and unproven economic growth strategies are still promoted as the most appropriate responses. This chapter presents findings from an interdisciplinary research project about quality of life (QoL) in rural Iowa that proposes changing the analytical paradigm in this context from growth to one that sees adaptation to population loss as a form of resiliency. Using qualitative and quantitative data, the research considers how some shrinking rural communities in Iowa have been better able to adapt than others. The research shows that negative trends in QoL perceptions in these towns were best mitigated by investing in community services and social capital, rather than in economic development. This process is described as rural smart shrinkage, a term borrowed from research on shrinking cities and applied here to rural communities for the first time. The framework shifts away from associating population loss with community decline and instead emphasizes intentional and low-cost strategies that may sustain shrinking rural communities into the future.