Retirement is a time to relax and lead a peaceful life without worrying about earning money. But, given the limited income (through pension plans) and resources available during this period, one needs to carefully plan one’s retirement life by prioritizing affordability. Since the cost of living can vary substantially between states, moving to one of the more affordable areas to spend one’s retirement can prove to be a financially viable decision.
1. Delaware
When it comes to making retirement affordable and budget-friendly, one of the most important things to consider is keeping life free of tax worries. This is one of the main reasons why Delaware ranks high among the top budget-friendly states for retirement life. There are no state taxes or even local sales taxes in this state. In fact, Delaware is also known for having low property taxes compared to the rest of the country. Also, during retirement, Social Security benefits stand out as one of the best financial supports. Fortunately, Delaware does not tax these benefits either, making it one of the best states for retirees on a budget.
2. West Virginia
Despite being a geographically small state, West Virginia ranks among the top states for budget-conscious retirees. This can be credited to the low cost of living, with an index of 84.8, according to the Missouri Economic Research and Information Center (MERIC). The state also has low property taxes, cheaper housing and utility costs, cheaper transportation costs, and affordable home insurance costs. Besides the price factor, West Virginia’s low crime rate also makes it an ideal choice for senior citizens. That’s not all, as West Virginia also offers multiple recreational opportunities and places to roam and explore, such as Cheat Lake and New River Gorge National Park and Preserve.
3. Georgia
With a cost of living that is lower than the national average, Georgia also stands out as one of the cheapest states for retirement life. As per reports, the cost of home insurance in the state has also seen a drop in recent times. Besides that, Georgia also has fairly affordable transportation and grocery prices. Apart from these, the state also offers the benefit of having several retirement communities and various opportunities for outdoor recreation. Sandy Springs, in particular, is considered a senior-friendly locality thanks to its shoreline of the Chattahoochee River, which offers ample opportunities for fishing or simply enjoying nature peacefully.
4. South Carolina
With no taxes on Social Security benefits, South Carolina also ranks high among the best states for affordable retirement living. Additionally, the state also has fairly low income tax rates (maximum being around 6.4%), which will particularly benefit seniors who have an alternative source of income for their retirement life. Besides these benefits, South Carolina is also known for its pleasant climate, which is an advantage for retirees.
5. Missouri
This is another state catering to retirees seeking a budget-friendly lifestyle. Like South Carolina, Missouri also has quite low income tax rates, with the highest being around 5%. Besides that, Missouri also does not levy taxes on Social Security benefits and has a fairly low cost of living, with an index of 89.0. Springfield, a city located in the southwestern part of the state, is especially known for its low cost of living. Besides that, it also houses multiple museums and has a rich culture, which makes it a decent option for retirees. Along with that, Columbia, another city in Missouri, is also considered an ideal place for retirees, with a cost of living that is around 5% less than the national average.
6. New Hampshire
Thanks to having no sales or state income tax and zero taxes on Social Security benefits, pensions, and 401(k) distributions, New Hampshire also ranks high among the best states for retirees seeking affordability. The money that seniors save from these tax exemptions can be well utilized for the numerous recreational activities that this state has to offer. These include cross-country skiing, hiking, and boating.
7. Tennessee
With no income or pension tax, Tennessee provides significant financial relief to seniors seeking budget-friendly retirement living choices. Besides having these tax exemptions, Tennessee also has a decently low cost of living, with an index of 90. Not to mention, the state is also an appealing mix of affordability and natural beauty, thanks to its numerous lakes, hiking trails, and national parks. Chattanooga, a city in the state, stands out as a popular retirement hotspot. This can be credited to the town’s rich art culture, evidenced by the numerous galleries, theaters, and events that will add vibrancy to one’s retirement life.
8. Arizona
Home to the Grand Canyon, Arizona has a very low state income tax—only 2.5% (flat)—and no taxes on Social Security benefits. The city of Prescott, in particular, is considered to be highly suitable for seniors and retirees. Among its population, more than 30% of individuals are over 65, and the city has a cost of living that is nearly 4% below the national average. Besides that, it is also home to numerous theaters and galleries, offering opportunities for social interaction and creative expression for seniors.
9. Oklahoma
An amazingly low cost of living—with an index of just 87.9—and no taxes on Social Security benefits give Oklahoma its worthy place among the most affordable states for retirement life. The state also has fairly low property taxes, and pensions and 401(k) distributions are only partially taxable. Besides that, Oklahoma also houses several retirement communities, which is an undeniable advantage.