Where Should You Retire in the U.S.?
As you start to approach retirement, you may begin to wonder where you should embark on this new chapter in your life. Which U.S. state will offer you the greatest benefits?
Applying weighted metrics for life quality, healthcare and affordability WalletHub has recently released a comprehensive list of the U.S.’s most and least retiree-friendly states.
Confirming what many may have suspected, Florida comes out on top. This state has the highest proportion of people 65 and over in the country and one of the most lenient tax regimes, with no estate, intangible or personal income tax.
Ending the list was poor old (or should that be young?) Kentucky.
But what if the Sunshine State just isn’t for you? Number two on WalletHub’s list is South Dakota, which also has the second-highest proportion of people 65 and over still in the workforce. Other top five states include Virginia, Colorado and New Hampshire.
According to WalletHub analyst Jill Gonzalez, there were some surprises as the list was compiled; in particular, the high position of South Dakota on the list and eighth-ranked Wyoming, which boasts living costs that are among the lowest in the country.
As Gonzalez explained, these states may be cold, but they offer a range of benefits, such as a retiree-friendly tax system with no taxes imposed on income from social security and pensions. Also, neither Wyoming or South Dakota have an inheritance or estate tax. “Residents in both states also have some of the longest lifespans in the country,” says Gonzalez.
Gonzalez was also surprised by the high ranking of New Hampshire and Colorado. Ranking fourth overall, the property crime rate in New Hampshire is the lowest in the country. Gonzalez acknowledges that these states are quite expensive to live in, but they are nonetheless good options for retirees due to their high physician to patient ratio and the good quality of their healthcare. As Gonzalez explains, “This is because they both have a low risk of social isolation, as well as a low share of the population aged 65+ in poverty.”
In terms of living costs, Alabama, Oklahoma, Mississippi, Wyoming and Arkansas are the most affordable states, but the lowest life expectancies are also recorded in Alabama, Oklahoma and Mississippi. In contrast, New York, Connecticut, Alaska, California and Hawaii are the most expensive U.S. states in which to live.
At the very bottom of the list is Kentucky, with New Mexico, Rhode Island, West Virginia and New Jersey also filling low-ranking spots. Despite the high population percentage of people 65 and over in West Virginia, the state has the lowest proportion of individuals of this age group still in work. Moreover, life expectancy in West Virginia is among the lowest nationwide.
Gonzalez sees the WalletHub list as a useful tool to help retirees assess their options. As the analyst says, “Though retirement represents the end of one’s career, it doesn’t have to be the end of financial security, nor should it mean a lower quality of life.” Happily, Gonzalez and her team have found several promising choices for retirees across the U.S. Using the WalletHub list, people can now identify their priorities, such as affordability, good healthcare or a strong retirement community, and pick the ideal place for their retirement.