Where will you go when you retire? Every year, some 100,000-plus people over age 60 relocate. Why? Well, retirement can mean new choices. When work no longer dictates where you have to live, new possibilities open up. You're not tied to a location for your career or a spouse's.
Without being tied down by a job, you can consider living elsewhere. Maybe you've traveled for work or pleasure and have seen different parts of the country and thought you'd like to retire to one of those places. You may just dream of a different pace of life, and a new lifestyle for your retirement — to explore and experience a new and different place. Or maybe it just makes sense financially to retire in a different state.
Of course, there are many factors to consider, and up and moving without any care or thought to the future would be impetuous and inadvisable to say the least. And, like everything, your vision for your retirement is your own; there isn't one best place for everyone.
To help you get started on deciding where to spend this next chapter of your life, we created this list of the 15 best states for retirees. To do so, we evaluated various existing studies—one by Bankrate, which used 7 different criteria, with different weights to determine the best places to retire. We also looked at the Kiplinger study that ranked all 50 states with an emphasis on financial factors. Other studies cited are from Thinkadviser, SmartAsset, and The Motley Fool.
At the top of all of their lists, and many of ours, is cost of living. Cost of living can vary greatly in different states. And, different state tax laws can also affect the cost of living for retirees. We also considered healthcare quality, as well as proximity for healthcare. Because, although you might have always dreamed of life in the country, you might not want to be too isolated in your retirement years. Naturally, the weather is another consideration if you are looking to move when you retire. After all, the cheapest place to live might just have too much extreme weather for you to tolerate. Other things we considered are crime, access to arts and culture, and general well-being.
Here are our top 15 choices for the best states to retire.
#1. North Carolina
We picked North Carolina as the best state to retire. We know money is an issue for retirement, and North Carolina offers some financial perks for retirees, such as no tax on Social Security benefits, property tax deferment for qualifying seniors, and no state inheritance tax. The state also offers many different opportunities for varying lifestyles. There are beaches, mountains, lakes, as well as plenty of retirement communities. North Carolina also has four seasons, although the weather is more moderate than the northern East Coast states. We like the diversity North Carolina offers, with Charlotte, it's largest city, offering a big city feel along with a big dose of history. There's also plenty to explore for active retirees, from the Outer Banks islands off the coast, to the Blue Ridge Parkway with it's rare habitats. We think North Carolina offers great opportunities for retirees at an affordable cost.
Bankrate ranked North Carolina in a tie for sixth-best state for retirement, while Smartasset showed the state as having the third-highest influx of individuals over 60 from the 2015 US Census report.
Florida has long been known as a mecca for retirees. It still has the highest influx of people over 60. We love the Sunshine State, well, for the sunshine. The sun makes us feel good, and the beaches and the sound of the ocean are good for the soul — everybody knows that the sound of the sea is therapeutic. "According to William Dorfman, a psychology professor at Nova Southeastern University, the white noise of waves breaking on the rocks relaxes our brains and stimulates the production of feel-good chemicals in our body, including serotonin and dopamine". Plus, it is one of the most tax-friendly states for retirees since it has no state income tax. That's right, no taxes on Social Security benefits, pensions, IRAs, 401(k)s and other retirement income. And, no state inheritance tax or estate tax. As for buying a house, you can still find one in the mid $200K range, just not on the beach in Miami, of course. On the down side, they are in the path of hurricanes, and the state has the highest percentage of population over 65 in the US.
Thinkadvisor ranks Florida as the best state to retire, while Bankrate places is at #5.
If you're noticing a trend, you're right: We like sunny days and warm weather, and that's what you can expect in Georgia. Kiplinger ranks Georgia at number #3 as well. With cost of living at 7 percent below the average in the US, Georgia also is tax-friendly for retirees. The median home price in Georgia is $166,00, well below the national average. Kiplinger also reports Georgia has affordable healthcare, with the sixth lowest average cost for healthcare in the US. You won't be alone retiring to Georgia, Smartasset reports Georgia ranks #7 in the 2015 census report for number of people over 60 relocating there. Although the humidity might take some getting used to, the overall temperatures through the year range between 40-80 degrees, a comfortable range for most of us. Georgia is a great blend of country, city, and history, as well as plenty of flora and fauna for active retirees to enjoy.
Ok, so we finally move out of the south! Utah has a completely different vibe and appeal, and maybe that's what you are looking for. After all, Bankrate rated Utah as their #1, and Kiplinger ranks Utah #10. So clearly, Utah has appeal for retirees. Utah boasts five national parks, seven national monuments, five national forests, and an impressive 43 state parks. Whew! There's no excuse not to be out doors and active living in Utah. It's not as tax-friendly, as Utah is one of the states that does tax Social Security benefits. The state tax is a flat 5 percent. On the flip side, the population is one of the healthiest in the country, and healthcare expenses are below the national average. Housing costs are near the national average. There is a low crime rate as well.
#5. South Dakota
Yes, South Dakota! We can't ignore both Kiplinger and Bankrate studies rated South Dakota #1. If affordability is a high priority for you, then consider this state where they won't tax your Social Security benefits, living expenses are low, and health care expenses are low as well. The average home price in South Dakota is $184,700, well below the national average. South Dakota ranks high on well-being, and after all, that's pretty important to all of us, especially when we retire. There's something to be said for the slower pace, less crowded, midwest vibe you will find in South Dakota. You just have to try to enjoy the cold winters.
#6. New Hampshire
This little gem in the northeastern US ranked #4 in the Bankrate study and #9 in the Kiplinger study. One big plus for this tiny state is there is no tax on Social Security benefits or other retirement income. There is no sales tax either. New Hampshire was also rated high for healthcare. According to Thinkadvisor, who rated New Hampshire #4, it ranks high in quality of life and healthcare. Another plus, New Hampshire borders Massachusetts and isn't far from New York, so it is in close proximity to these cultural centers, without the really high price tag they hold. Of course, the state does come with it's share of cold weather.
Here's another surpriseWyoming ranks high on affordability due to no state income tax, and and offers tax benefits for retirees. Wyoming is also at the national average for cost of living, with median home costs at $218,00, the national average. Wyoming has plenty of open space and activities for retirees who love to hike and fish. The winters are definitely a downside if you don't like the cold, but the positives might just outweigh the cold for some.
Wyoming ranked #8 in the Bankrate study of the best states to retire, and Thinkadvisor ranked Wyoming #8 as well. Kiplinger didn't favor Wyoming quite so high, giving it the #17 spot on their list.
Who wouldn't want to retire to Hawaii? Don't we all dream of getting away from it all, permanently, on a beautiful island? Well, maybe not everyone. But it's appealing enough to rank #2 in the Kiplinger study, and #11 in Bankrate. And Bankrate rated Hawaii #3 in terms of culture. Although it's not cheap overall to live in Hawaii, healthcare costs are relatively low compared to the national average. The median price for homes in Hawaii is a whopping $618,000. And, everything has to be brought in, so prices for food, gas, and just about anything else are more than on the mainland. Some pensions and Social Security aren't taxed. However, private pensions and retirement savings accounts are. For those with a healthy budget for retirement, Hawaii still might be just to the place to live in retirement. It would truly be like a permanent vacation and you could probably get friends and family to visit you pretty often.
Austin, Texas has long been a magnet for young people seeking an affordable city with vibrant culture, music, and arts. But what put Texas on the map for those of us looking to retire was Fixer Upper. Really, did you ever think you'd want to move to Texas before Chip and Joanna Gaines put their mark on Waco? Now we all want to move there, just to soak up all of Joanna Gaines' good vibes. Although Bankrate's study ranked Texas #17 and Kiplinger #24, we give Texas a higher rank just because we know they probably surveyed men, and didn't take into account the Magnolia effect. Seriously, Texas has affordable housing, the median home value is below the national average at $191,000, plus cost of living is below the national average. And, there is no state income tax. On the downside, healthcare costs are above the national average, and Kiplinger reports Texas has the sixth highest poverty rate among seniors in the country at 10.8 percent.
Here's how this state in the middle of the midwest stacks up: Thinkadviser #7, Bankrate #16, Kiplinger #13. But, in a 2018 study, Wallethub ranked Iowa #4, based on affordabitily, quality of life, and healthcare. Iowa has a low cost of living, Social Security benefits are untaxed, but retirement income is fully taxed after a modest exclusion for seniors. If you are worried there's nothing to do but watch corn grow, think again. Iowa has a couple of large universities that boast vibrant communities with lots to do, including university lifelong learning programs. Plus, there are opportunities for fishing, mountain biking, and lots of parks and open spaces to explore. Yes, it snows in the winter and there are still lots of farms, but we still think it's worth considering Iowa for retirement.
Kiplinger sites higher than average cost of living in Colorado and gives it a "mixed" rating for taxes. But we can't overlook Colorado ranks #4 in the nation for senior health with "great rankings for clinical care and positive behaviors." It also has low obesity rates for seniors compared to the national average, and low inactivity rates as well. So, if you want to retire somewhere you can be active, get great healthcare, and experience a sense of well being (Bankrate rated Colorado #6 in well-being), then consider Colorado in your search.
Colorado was ranked by Thinkadviser at #3, and at #17 by Bankrate and #18 by Kiplinger.
Although the cost of living is higher than the national average, Virginia is one of the states that doesn't tax Social Security benefits. And, Virginia's property tax is less than 1 percent. Virginia also ranked high with Bankrate for crime, meaning it's a pretty safe place for retirees. Of course, there's lots of history to see in Virginia, and plenty of outdoor activities to keep retirees busy. The climate is more moderate than other East Coast states, so you can get outdoors year-round without too much difficulty. Particularly if you love history, Virginia might just be the place for you.
Virginia is ranked pretty high by Thinkadviser at #5, and Kiplinger at #7. Bankrate ranks Virginia at #13, with their cost of living ranking at #30 probably lowering their overall ranking.
Here' a Southern state that has long been known for it's music scene. But we think it has much more to offer to retirees. Median house price in Tennessee is $163,800. And, no state income tax either. A big negative, however, is a high crime rate, with a ranking of 45th in this area in the Bankrate list. Still, there is lots to do and see to be active as a retiree in Tennessee, and definitely worth consideration, especially if budget is a concern. Tennessee also received a ranking of #5 from Kiplinger as a great place to retire, as it is below average in the cost of everything. Although Bankrate ranked Tennessee at #21, we split the difference here.
Never thought of yourself as a "cornhusker"? Well, think again! This midwest state ranked #9 with Bankrate, and #21 with Kiplinger. With a cost of living 12 percent below the national average, Nebraska might be a consideration for the budget-conscious retiree. But, you might be spending some of that savings in taxes, according to Kiplinger's study. They report Social Security benefits are only exempt for seniors of certain income levels, and all other income is taxable as well. But people in Nebraska are friendly and happy, and well-being is ranked pretty high, and was in the top ten for overall well being in a Gallup Poll done a few years ago. Although winters are cold, you can pretty much count on a white Christmas, and maybe you would love that! It's not for someone who's dreaming of sunshine everyday, but worth considering, especially if budget is a concern.
This tiny state in the Mid-Atlantic region of the US offers retirees some good financial incentives for retiring there. Smartasset reports that Delaware ranked #9 on the number of individuals over 60 moving into the state as reported on the 2015 US Census. According to Zacks, there is no state tax on Social Security, people over 60 receive a $12,500 pension exclusion from state tax, the state has no sales tax, and offers some property tax perks for retirees. Among it's amenities are beautiful beaches and quaint little towns. There are plenty of historical sites as well as nature preserves, so there's something for everyone. Winters are mild, and it's not too far from Philadelphia, and it's a two-hour train ride to New York City if you crave big city culture. Although cost of living is over the average for the US, cost of healthcare is lower, and Delaware ranked #6 in the country for healthcare in the Bankrate study.