Best States to Retire

When you’re planning where to retire, there are several factors to weigh.

How does Florida stack up to Maine? West Virginia is an inexpensive place to live, but what about other factors that may be important to you in retirement?

Some are personal or focused on lifestyle, such as where your family is or where you have friends and connections. You might just feel like you belong in a particular location or have business contacts that will help you earn some money. Your individual preferences, such as climate, activities and even politics, may weigh heavily in your decision-making.

Measurable factors, such as taxes on seniors, the quality of healthcare and cost of living, however, are equally important because they are typically related to financial health. And regardless of where you live, your financial health influences your quality of life.

In 2017, Kiplinger ranked all 50 U.S. states according to their advantages for retirees, based primarily on financial considerations.

The idea of moving to South Dakota or Florida might horrify you, but if your financial well-being is high on your list of priorities in retirement, you may want to reassess the pros and cons of spending your retirement years in one of these states.

One indicator of good places for retirees is how many seniors live there already. There could be a reason or two for the attraction to those places.

According to the most recent data from the Federal Interagency Forum on Aging-Related Statistics, 14.6 percent of the national population was aged 65 and older in 2014.

Sumter County in Florida had the highest concentration of seniors, with 53 percent of the county’s population aged 65 and older. At the other end, Chattahoochee County, Georgia, had the lowest proportion of seniors at just 4.1 percent.

With limits on your income, your tax burden in retirement can be a high priority. The amount you pay in taxes can vary quite a bit in the United States, depending on where you live.

It also depends on what kind of taxes hit you hardest. Some states have no income taxes. Some have very low property taxes or no sales tax.

AARP says Alaska and New Hampshire impose no tax on sales, income or Social Security. Alaska also gives residents an annual royalty payment from the state’s oil deposits.

Delaware, Montana and Oregon don’t have sales taxes.

Coincidentally, these states also don’t tax military retirement pay, according to MilitaryBenefits.info.

In addition, New Hampshire imposes income taxes only on dividends and interest, which can be important to people living off their investments. Tennessee’s dividends and interest taxes will be gone in 2020.

The Tax Foundation ranks states according to their per capita state and local tax burdens overall.

According to 2012 data, the states with the highest overall tax burdens are New York, Connecticut, New Jersey, Wisconsin and Illinois. The states with the lowest tax burdens per capita include Texas, Tennessee, Wyoming, South Dakota and Alaska.

Another factor important to seniors is the cost of living. If you live in California, for instance, your money won’t go as far as it would if you lived in West Virginia.

Using a cost-of-living index that compares each state with a national average score of 100, Sperling’s Best Places ranks each state by how much it costs to live there. A ranking of less than 100 means the state has a lower cost of living than the national average, and value higher than 100 means the state’s cost of living is higher than the national average.

For example, the state with the lowest cost of living, West Virginia, has a score of 84.

Hawaii is ranked as the most expensive state, with a score of 187.

To measure the health of each state’s senior population, United Health Foundation ranks states according to the World Health Organization’s definition of health: “Health is a state of complete physical, mental and social well-being and not merely the absence of disease or infirmity.”

The foundation’s America’s Health Rankings Senior Report analyzes the nation’s senior population on a state level using 35 measures of senior health across six categories.

In the 2016 Senior Report, Massachusetts came out on top, followed by Vermont, New Hampshire, Minnesota and Hawaii.

Louisiana was at the bottom of the list, hindered by “a high prevalence of smoking, obesity, and physical inactivity.”

The Commonwealth Fund ranks the performance of state health systems. Rankings consider the quality of care, health outcomes and disparities across the United States.

According to the nonprofit health research organization’s 2019 Scorecard on State Health System Performance, the highest-ranking states for health care systems are Hawaii, Massachusetts, Minnesota, Washington, Connecticut and Vermont.

The states that ranked at the bottom, Arkansas, Nevada, Texas, Oklahoma and Mississippi, suffer from federal and state policy decisions regarding Medicaid access, increasing health care costs and a high percentage of uninsured adults.

Your overall comfort and quality of life in retirement are heavily influenced by the activities you undertake. States with mild weather afford more opportunity for outdoor activities. If you like being outdoors, the climate of the state in which you live is important to your physical and mental well-being.

The average number of sunny days in the United States is 205 a year, according to Sperling.

All of these rankings are based on averages and selected data. With any average, there will be experiences that are better, as well as worse.

You may live in a state that the list-makers say has a poor system of health care. And yet, you have a wonderful doctor and have received the best medical treatment you could want.

The lists don’t consider other things like the types of communities. For example, college towns are worth considering because they may have interesting activities like art exhibits, lecture series and classes to audit. Or maybe you want to live by the water or in the mountains.

This is all to say that the rankings are useful for painting a big picture. But your results may vary.