If you’re on a fixed income — like most people in retirement — controlling your expenses becomes more important than ever.
One way to do that? Living somewhere with a lower cost of living. That’s part of the thinking behind the website WalletHub’s recent ranking of “2023’s Best States to Retire.”
While their ranking incorporates “47 key indicators of retirement-friendliness” sorted into three key dimensions — health care, quality of life and affordability — we’re just going to highlight the best states in that last category, affordability.
Here are the states deemed most affordable for retirees.
The state of Mississippi ranks dismally for health care and dead last for quality of life in WalletHub’s ranking, but it is certainly affordable. And don’t let a survey ranking scare you off: Consider Hattiesburg, one of “18 Great Warm and Sunny Places to Retire in the U.S.”
Florida is famous for its retirees, so it’s no surprise WalletHub found it to be the state with the second-highest percentage of the population aged 65 and older. The state also ranked No. 4 for quality of life. In Florida, retirees won’t contend with taxes on Social Security benefits or personal income.
Arkansas has the second-worst overall quality of life in the country, according to WalletHub. Nonetheless, it ranks as one of the most affordable states for retirees and has the fifth-lowest cost of in-home services.
WalletHub’s study found that Georgia has one of the lowest percentages of the population that’s age 65 and older despite being a relatively affordable state for retirees.
A separate study from Bankrate in 2021 rated Georgia as the best state for retirees based on affordability, wellness, weather and other factors.
Delaware has the second-best “taxpayer” ranking behind Alaska, according to WalletHub, and one of the highest shares of the population that’s age 65 and older. Residents in Delaware may be able to exclude a certain amount of retirement income from taxes, and the state does not tax Social Security benefits, according to the Delaware Division of Revenue.
Out of the top 10 most affordable states for retirement, Wyoming stands out for its excellent quality of life, taking WalletHub’s No. 9 ranking in that category. As we noted in “Retirees Are Flocking to These 10 States,” retirement is the top reason 42% of new residents say they moved here.
4. South Carolina
Despite ranking below average in the other categories of WalletHub’s study, South Carolina’s high score on affordability helped give it the No. 16 position overall among the best states to retire in.
One downside? South Carolina is among “3 States Where Home Insurance Rates Have Skyrocketed Amid Inflation.”
3. West Virginia
West Virginia has the third-highest percentage of seniors in its population. For “almost heaven,” as the John Denver song goes, we recommend Cheat Lake.
Tennessee ranks 33rd overall as a place for retirees, after placing low on health care and quality of life, according to WalletHub, but it takes the No. 2 spot for affordability. The state has no personal income tax.
At opposite ends of the scale, WalletHub gave Alabama the lowest ranking for health care but the top ranking for affordability. Alabama also has going for it some of the lowest property tax rates in the country.