You’ve probably been dreaming about retirement since the day you started working. But will your budget allow you to make those dreams a reality? It has a better chance if you pick an affordable retirement destination.
To identify some of the cheapest places in the U.S. where you will actually want to retire, we started by selecting a great place to retire in each state. We based our analysis on factors critical to retirees including lifestyle, safety, taxes, quality of health care and, of course, cost of living. Then, from that list of 50 picks we weeded out the places that, while otherwise promising, sport living costs for retirees that are above the national average. We were left with 23 appealing places that are particularly cheap for retirement. See for yourself if any of these destinations could be where you live out your dreams.
1. Decatur, Alabama
Cost of living for retirees: 11.0% below U.S. average
Share of population 65+: 14.5% (U.S.: 14.5%)
Alabama’s tax rating for retirees: Tax-Friendly
Lifetime health care costs for a retired couple: Below average at $364,860 (U.S.: $394,954)
The Heart of Dixie offers many great spots for affordable living, but Decatur is our top pick. While the median home value is $176,700 for the nation as a whole, it’s just $122,500 in Alabama and $120,400 in Decatur. The Tennessee River offers inexpensive options for outdoor recreation, including some of the state’s best bass fishing in Wheeler Lake.
The tax situation is equally attractive. Alabama doesn’t tax Social Security and most pension income, and homeowners 65 and older are exempt from state property taxes (and some, if not all, local property taxes).
2. Prescott, Arizona
Cost of living for retirees: 3.7% below U.S. average
Share of population 65+: 30.8%
Arizona’s tax rating for retirees: Most Tax-Friendly
Lifetime health care costs for a retired couple: Below average at $378,205
Undoubtedly, many of you have considered the Grand Canyon State for its retiree-friendly climate and beautiful natural setting. Plus, the tax situation is equally attractive. With its low income taxes and lack of state taxes on Social Security, Arizona is among the 10 most tax-friendly states for retirees.
Prescott, about 100 miles north of Phoenix, eases the stress on your retirement kitty even more with its below-average living costs. But affordable doesn’t mean boring. Prescott offers an active cultural scene with numerous theaters, galleries and music venues, as well as a wealth of things to do outdoors, including golfing and hiking.
3. Hot Springs, Arkansas
Cost of living for retirees: 7.5% below U.S. average
Share of population 65+: 21.3%
Arkansas’s tax rating for retirees: Tax-Friendly
Lifetime health care costs for a retired couple: Below average at $355,695
You won’t need to travel far for rest and relaxation if you settle in this retirement hotspot. Surrounding the north end of the city of Hot Springs is Hot Springs National Park, which has 47 hot springs that come out of the mountain of the same name and two bathhouses, where you can drink from fountains and soak in the water. The relaxing experience extends into the city proper, where there are many spa and massage services to choose from. You can also unwind by golfing at one of the area’s 11 championship courses or by fishing or boating on one of the three local lakes.
Even your wallet can de-stress. Housing and health care for retirees are particularly low, at 24.1% and 12.2% below the national average, respectively. The median home value in Hot Springs, about 60 miles southwest of Little Rock, is $115,600—far below the national median of $176,700.
4. Grand Junction, Colorado
Cost of living for retirees: 4.4% below U.S. average
Share of population 65+: 15.6%
Colorado’s tax rating for retirees: Tax-Friendly
Lifetime health care costs for a retired couple: Below average at $384,980
Grand Junction holds plenty of (often free) fun for nature-loving retirees. You can enjoy scenic hiking, biking and rafting in the warmer months, and skiing and snowshoeing when the snow falls. Indoors, you can take advantage of the intellectual and cultural offerings of Colorado Mesa University.
Also, the Highest State keeps taxes low for retirees. Residents age 55 and older get a generous retirement-income exclusion from state income taxes. There’s no inheritance or estate tax, either.
5. Punta Gorda, Florida
Cost of living for retirees: 5.2% below U.S. average
Share of population 65+: 47.9%
Florida’s tax rating for retirees: Most Tax-Friendly
Lifetime health care costs for a retired couple: Above average at $409,097
With its desirable climate and favorable tax status, Florida is filled with popular retirement destinations. Punta Gorda consistently ranks as one of the best. Because nearly half of its residents are age 65 and older, the city is wise to recognize its strong senior presence and do all it can to satisfy them. You can find numerous retirement communities, restricted to people age 55 and older, that offer waterfront sites, golfing, fishing and other activities. In town, the Harborwalk along Charlotte Harbor is just a portion of the 18 miles of bike trails and pedestrian pathways you can enjoy.
For more amenities, including many restaurants and a lively arts scene, Sarasota is a little more than 50 miles away on the Gulf coast and is another great place to retire.
6. Sandy Springs, Georgia
Cost of living for retirees: 5.1% below U.S. average*
Share of population 65+: 10.8%
Georgia’s tax rating for retirees: Most Tax-Friendly
Lifetime health care costs for a retired couple: Below average at $376,884
A suburb of Atlanta, Sandy Springs (population: 102,000) offers small-city comforts with close proximity to big-city attractions. Outdoor enthusiasts can enjoy area birding and fishing, as well as 22 miles of shoreline along the Chattahoochee River.
Under construction is a new walkable city center named City Springs, with plans to include a performing arts center, family theater and park, as well as restaurants, retailers and housing. Groundbreaking on the site was in 2015, and the development is slated for completion in late 2017 or early 2018. In the meantime, you can take a Marta train to downtown Atlanta’s Five Points neighborhood. The ride costs just $2.50 and takes less than 40 minutes.
*Based on cost of living for retirees in the nearby Marietta metro area
7. Boise, Idaho
Cost of living for retirees: 7.3% below U.S. average
Share of population 65+: 11.2%
Idaho’s tax rating for retirees: Mixed
Lifetime health care costs for a retired couple: Below average at $366,449
Boise is a great college town for your retirement. Boise State University provides plenty of intellectual stimulation to help keep an aging mind sharp. Its Velma V. Morrison Center for the Performing Arts hosts symphony concerts, dance performances and Broadway shows. You can also take classes at the school through the Osher Lifelong Learning Institute; membership costs $70 for a year.
Off campus, you can walk, run or bike the more than 20 miles of paved trails of the Boise River Greenbelt. Other outdoor activities to enjoy around the area include kayaking, boating, fly-fishing, golfing and skiing, just to name a few.
8. Bloomington, Indiana
Cost of living for retirees: 9.8% below U.S. average
Share of population 65+: 7.9%
Indiana’s tax rating for retirees: Not Tax Friendly
Lifetime health care costs for a retired couple: About average at $398,396
If you’re willing to brave the harsh winters and tax environment of Indiana, you might as well retire in Bloomington. Home of Indiana University, Bloomington boasts plenty of sporting events, concerts and festivals for your entertainment. The university also has a lifelong learning program that offers a variety of courses, as well as day trips and symposiums, for local adults. A course catalog sample: a one-day lesson in jazzing up holiday tunes for $25. Looking for a more demanding academic challenge? Retired Indiana residents who are age 60 and older can get 50% off tuition at state schools for up to nine credit hours a semester.
And the savings don’t stop there. Overall living costs in Bloomington are low, with particularly affordable housing expenses for retirees (19.5% below the national average).
9. Des Moines, Iowa
Cost of living for retirees: 9.1% below U.S. average
Share of population 65+: 11.0%
Iowa’s tax rating for retirees: Mixed
Lifetime health care costs for a retired couple: Below average at $372,712
There are retirement destinations of all sizes to choose from in Iowa, one of our 10 best states for retirement. For retirees looking to live in a big city on a small budget, Des Moines is a good choice. Affordability is just one reason the Milken Institute ranked the state capital seventh out of 100 large U.S. metro areas for successful aging. Des Moines also boasts a strong economy, numerous museums and arts venues, and plenty of health care facilities specializing in aging-related services.
10. Topeka, Kansas
Cost of living for retirees: 8.0% below U.S. average
Share of population 65+: 14.3%
Kansas’s tax rating for retirees: Mixed
Lifetime health care costs for a retired couple: Below average at $376,280
With its low cost of living, Kansas in general rates as one of our 10 best states for retirement. And the capital city is particularly affordable. The median home value for the Sunflower State is $128,400 and is even lower in Topeka, at just $95,600, well below the national median of $176,700.
Plus, the University of Kansas’s main campus, with all the amenities of college life, is less than 30 miles away in Lawrence. The university’s Osher Lifelong Learning Institute offers low-cost classes and special events designed for students age 50 and older. Also, KU’s Landon Center on Aging houses clinical and research facilities focused on the treatment of older adults.
11. Lexington, Kentucky
Cost of living for retirees: 7.8% below U.S. average
Share of population 65+: 10.5%
Kentucky’s tax rating for retirees: Tax-Friendly
Lifetime health care costs for a retired couple: About average at $393,195
As you’d expect, the Bluegrass State holds plenty of appeal for horse lovers and bourbon aficionados. But retirees can pursue other interests here as well. Lexington has more than 100 parks, six public golf courses and a 734-acre nature preserve with more than 10 miles of hiking trails. For indoor entertainment, you can check out the numerous galleries and theaters, including the Lexington Opera House and its schedule of ballets, Broadway musicals, comedy shows, operas (of course) and other performances. The University of Kentucky offers the Singletary Center for the Arts, too.
You can also satisfy your academic pursuits at the University of Kentucky. The Osher Lifelong Learning Institute offers various courses, forums, interest groups, trips and events to people age 50 or older; annual membership costs $25. The Donovan Fellowship allows Kentucky residents age 65 and older to take university classes free, space permitting. For all these reasons and more, Lexington ranks among our great college towns for retirement.
12. New Orleans, Louisiana
Cost of living for retirees: 4.3% below U.S. average
Share of population 65+: 10.9%
Louisiana’s tax rating for retirees: Most Tax-Friendly
Lifetime health care costs for a retired couple: About average at $395,452
Pleasure-seeking retirees can find a lot to satisfy them in the Big Easy. The unique cultures, delicious foods and signature music are big draws. The city offers brass band parades and festivals throughout the year, including the hugely famous jazz fest.
Considering New Orleans is a world-renowned convention and tourism destination, the cost of living for residents is surprisingly reasonable. So, too, are taxes on retirees, explaining why Louisiana ranks as one of our 10 most tax-friendly states for retirees. The city’s median home value is $183,700, slightly higher than the national median of $176,700, though it might be worth it to pay a bit more to live in nearby Metairie (where the median home value is $209,500). The New Orleans suburb offers greater safety and a higher share of seniors, who make up 17.1% of the population.
13. Columbia, Missouri
Cost of living for retirees: 4.8% below U.S. average
Share of population 65+: 8.5%
Missouri’s tax rating for retirees: Mixed
Lifetime health care costs for a retired couple: Below average at $370,190
Columbia is a great place to retire, due in large part to the three colleges that call it home. The University of Missouri, Columbia College and Stephens College bring sporting events, concerts and other artistic and cultural entertainments to the city. You’ll also find no shortage of bookstores, shops and restaurants around town. Adults age 50 and older can take courses through Mizzou’s Osher Lifelong Learning Institute; the cost is $80 for each eight-week class in the spring and fall.
The city’s top-rated hospitals and health care services are another big advantage, and they’re a big reason the Milken Institute ranking Columbia the third best small metro area for successful aging. Plus, the care is relatively affordable. For example, the median annual rate for one bedroom in an assisted-living facility is $35,640 in Columbia, less than the national median of $43,200, but more than the $30,300 median for the state. Housing costs for retirees are 13.3% below the national average.
14. Omaha, Nebraska
Cost of living for retirees: 8.5% below U.S. average
Share of population 65+: 11.4%
Nebraska’s tax rating for retirees: Least Tax-Friendly
Lifetime health care costs for a retired couple: Below average at $378,346
No matter your age, Omaha is an attractive, affordable place to live, with plenty of activities to entertain happy cheapskates. For retirees, living costs are below average across the board, with housing being a remarkable bargain: The city’s median home value is just $133,500. A private room in a nursing home costs a median $82,125 a year, below the national $91,250 median, according to Genworth.
An abundance of health care facilities and professionals, among other factors, led the Milken Institute to rank Omaha the second best large metro area for successful aging. Also contributing to its high ranking is the area’s economic strength. It’s home to five Fortune 500 companies and boasts low unemployment—even among mature adults who choose to remain in or return to the workforce. Look no further than the Oracle of Omaha, 85-year-old Warren Buffett, for proof.
15. Columbus, Ohio
Cost of living for retirees: 9.4% below U.S. average
Share of population 65+: 8.6%
Ohio’s tax rating for retirees: Mixed
Lifetime health care costs for a retired couple: About average at $391,585
The biggest city in the Buckeye State comes with some of the smallest costs. In fact, it’s one of the most affordable big cities in the U.S. From groceries to health care, expenses for retirees fall below average across the board, with housing-related costs being particularly low. The median home value in Columbus is just $130,700, compared with the national median of $176,700. A private room in a nursing home goes for a median $75,920 a year—much more affordable than the state’s median of $85,775 annually and the nationwide median of $91,250, according to Genworth.
Affordability doesn’t equate to lack of activities. Home to the Ohio State University, locals can enjoy the co-ed culture, including big sporting events, concerts and cultural diversions. It also offers Program 60, which invites Ohio residents age 60 and older to take university courses free. Off campus, the downtown area has a lively scene with an eclectic mix of shops, galleries and restaurants.
16. Tulsa, Oklahoma
Cost of living for retirees: 11.6% below U.S. average
Share of population 65+: 12.5%
Oklahoma’s tax rating for retirees: Tax-Friendly
Lifetime health care costs for a retired couple: Below average at $379,464
Tulsa is a very affordable big city. With a population nearing 400,000, it’s the second largest city in the Sooner State, behind Oklahoma City. But the living costs are small; for retirees, bills for everything from groceries to health care fall below average. Housing-related costs for retirees are particularly affordable, at 34.9% below average. The median home value is $122,200, well below the nation’s median of $176,700. A private room in a nursing home costs a median $64,788 a year, compared with a median annual $91,250 for the U.S., according to Genworth.
The area also offers plenty of amenities. For active retirees, there are 23 public golf courses, 135 tennis courts, 50 miles of biking and running trails along the Tulsa River, and more hiking trails on Turkey Mountain. There are also lots of dining and shopping options around town, as well as galleries, museums and theaters, including the Tulsa Art Deco Museum, Woody Guthrie Center and the Tulsa Performing Arts Center downtown. High crime rates for the city are notable but tend to be concentrated in the north side; areas of midtown and downtown offer more safety.
17. Myrtle Beach, South Carolina
Cost of living for retirees: 3.5% below U.S. average
Share of population 65+: 15.1%
South Carolina’s tax rating for retirees: Tax-Friendly
Lifetime health care costs for a retired couple: Below average at $381,681
Myrtle Beach is a great setting for the classic retirement dream of endless rounds of golf, broken up only by lounging on the beach. Tee off from any of about 100 championship golf courses in the area. And enjoy 60 miles of beach, where you can just lay out or opt to boat, fish, surf, kayak, scuba dive or partake in other water activities.
Life with all these amenities comes relatively cheap in Myrtle Beach. For example, housing-related costs for retirees typically come in 28.5% under the national average. By comparison, Hilton Head Island—another popular South Carolina retirement destination, where 28.8% of the population is age 65 and older—has housing-related costs 8.2% above average for retirees.
18. Sioux Falls, South Dakota
Cost of living for retirees: 5.8% below U.S. average
Share of population 65+: 10.9%
South Dakota’s tax rating for retirees: Most Tax-Friendly
Lifetime health care costs for a retired couple: Below average at $370,154
If you’ve never considered moving to South Dakota, perhaps you should. For one thing, it’s really easy to avoid crowds there. The entire Mount Rushmore State is home to fewer than 900,000 people, or 10.7 people per square mile. (By comparison, New Jersey, the most densely populated state, holds 1,195.5 people per square mile.) But Sioux Falls is filled with advantages, including a booming economy, low unemployment and hospitals specializing in geriatric services. For all these reasons, plus the city’s recreational activities (including regularly scheduled pickleball), the Milken Institute dubbed Sioux Falls the best small metro area for successful aging.
And all that comes pretty cheap for retirees. Along with low overall living costs in Sioux Falls, the median home value is $152,200, compared with $176,700 for the U.S. (The median for the state at $132,400.) Plus, the state's tax picture is one of the best for retirees.
19. Chattanooga, Tennessee
Cost of living for retirees: 6.0% below U.S. average
Share of population 65+: 14.7%
Tennessee’s tax rating for retirees: Tax-Friendly
Lifetime health care costs for a retired couple: Below average at $382,360
The Volunteer State is a good choice for most retiree budgets. On top of the friendly tax situation, most areas have below-average living costs across the board for retired residents. Chattanooga’s housing-related costs for retirees are notably low, at 12.9% below average. The city’s median home value is just $138,100, compared with $176,700 for the U.S. Single occupancy at an area assisted-living facility costs a median $41,400 a year; the national median is $43,200 a year.
The city’s vibrant arts scene is a nice draw, with many galleries scattered throughout the Bluff View Art District, as well as the NorthShore and Southside districts. You can also enjoy a lot of quality music events, such as the nine-day Riverbend Festival and Three Sisters Bluegrass Festival, and you can take in theater performances year-round. For outdoor recreation, you can take an easy bike ride or stroll along the Tennessee River, or challenge yourself with area rock climbing, mountain biking, white-water rafting or hang gliding. Be aware of the high crime rates for the state and city. But also recognize that you can certainly find safe neighborhoods, such as Ryall Springs and West View—the safest neighborhoods in Chattanooga, according to www.neighborhoodscout.com.
20. Sherman, Texas
Cost of living for retirees: 13.0% below U.S. average
Share of population 65+: 13.2%
Texas’s tax rating for retirees: Tax-Friendly
Lifetime health care costs for a retired couple: About average at $393,414
With a population of less than 40,000, the small city of Sherman offers retirees big savings. Overall living costs are cheap, and housing-related costs for retirees are particularly affordable, at 24.8% below average. The median home value is $98,100 in Sherman proper and $79,100 in Denison (also part of the greater metro area)—well below the state’s $128,900 median. Residents can save on taxes, as well: The Lone Star state levies no income tax.
In Sherman, you can enjoy boutique shopping, unique cafés and several community gatherings throughout the year, including an Earth Day festival and free "Shakespeare in the Grove" performances. Also explore the 12,000-acre Hagerman National Wildlife Refuge, home to about 500 different wildlife species. And when you feel the urge for big-city stimulation, Dallas is about an hour’s drive away.
21. St. George, Utah
Cost of living for retirees: 8.5% below U.S. average
Share of population 65+: 19.0%
Utah’s tax rating for retirees: Not Tax-Friendly
Lifetime health care costs for a retired couple: Below average at $376,742
St. George’s low living expenses can help ease the sting of Utah’s tax bite. Living costs in all categories—from groceries to health care—fall below the national average. And the city’s affordability isn’t limited to the retired population; it also ranks as one of our cheapest cities youvll want to live in regardless of age.
Outdoor-loving retirees can appreciate St. Georgevs location just south of some state parks and conservation areas, west of Zion National Park, and north of the Grand Canyon. Athletes who are age 50 and older can even participate in the Huntsman World Senior Games, an annual competition hosted in St. George. Sports include archery, basketball, golf, softball, track and field, and much more. If that’s not enough for risk-taking retirees, try your luck in Las Vegas, a two-hour drive away.
22. Roanoke, Virginia
Cost of living for retirees: 8.7% below U.S. average
Share of population 65+: 14.3%
Virginia’s tax rating for retirees: Mixed
Lifetime health care costs for a retired couple: Below average at $388,548
Take a hike. Really. Retiring in Roanoke, between the Blue Ridge and Allegheny mountains, provides outdoorsy types with more than 600 miles of nearby trails. For the less actively inclined, you can still enjoy the views with a drive along the Blue Ridge Parkway. Or sample tastes from the wide selection of local breweries and wineries.
Retiree living costs look just as good, falling below average in every category. Housing-related expenses for retired residents typically run 11.7% below the national average. Across all ages, the median home value in the city is $134,700, far less than the $244,600 median for the state.
23. Spokane, Washington
Cost of living for retirees: 6.0% below U.S. average
Share of population 65+: 12.8%
Washington’s tax rating for retirees: Tax-Friendly
Lifetime health care costs for a retired couple: About average at $392,810
Located about 300 miles east of Seattle, between the Cascade Mountains and Rocky Mountains, Spokane is a nice choice for retirees looking to retreat to nature. On top of all the hiking and biking afforded by the mountains, as well as the 37 miles of the downtown Centennial Trail, the area boasts 76 lakes and rivers for you to enjoy swimming, boating, fishing and more. There are also 33 golf courses, more than 20 wineries and many breweries and distilleries around the region.
Spokane also offers affordability. Although health care costs for retirees are 10.5% above the national average, housing-related costs are 13.4% below average. The median home value is $160,500 in the city; by comparison, Seattle’s median home value is $433,800. Single occupancy in an assisted-living facility is typically about $48,000 a year in the Spokane metro area. That’s more than the national median of $43,200 a year, but less than the $55,500 state median.
Estimates of living costs for retirees, where available, come from the Council for Community and Economic Research. Populations and median home values are from the U.S. Census Bureau. Estimates of states' average lifetime health care costs during retirement for couples retiring at 65 are from HealthView Services. Tax rankings are based on Kiplinger’s Retiree Tax Map, which divides states into five categories: Most Tax-Friendly, Tax-Friendly, Mixed, Not Tax-Friendly and Least Tax-Friendly. Crime statistics are from the FBI. Retirement destinations are listed in alphabetical order by state.
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