Best and Worst States for Retirement in 2022

April 14, 2022

Choosing the best state for retirement requires careful consideration of the financial, health and social impacts on your life. You’ll want to balance affordability and health care with the quality of life, social groups and available activities.

We gathered and analyzed the data most critical to retirees in all 50 states. We surveyed our readers, and their opinions are reflected in the RL Rating for each state. Then we crunched the numbers to find the best and worst states for retirement in 2022.

Best and Worst States for Retirement

Source: Retirement Living

10 Best States for Retirement

We gathered data on housing costs, state taxes, health care availability and quality of living specifically affecting retirees. Finally, we took a look at data for all 50 states, including the:

  • Percentage of the population over age 65
  • Affordability index, taking median income and home prices into consideration
  • Available parkland, a strong indicator of opportunities for activities
  • Retirement Living (RL) rating scale from 1 to 5, with 5 being highest

We parsed the data to find the 10 best retirement destinations and 10 worst states for senior living. You’ll find those states listed below with the pros and cons of each. We recommend consulting with a financial planner before retiring to another state.

FLORIDA

Florida | Retirement Living

This year, Florida again takes the top spot as the best state for retirement. Twenty-one percent of the population is over the age of 65, and state parkland is abundant. You’ll find senior communities and activities plentiful in Florida.

From Our Readers:

  • “Low taxes and great place to live”
  • “Overall cost of living, lack of onerous taxes, and a favorable political climate”
  • “Able to play golf 365 days a year”

Florida state taxes are affordable since there’s no income tax, but the sales tax rate is slightly elevated. Home prices rose over the past year in Florida, but this reflects a trend across the country. The median home price is in the middle of our top states. Health care availability is average.

Florida is a popular destination for family vacations and “snowbirds,” causing crowding in some areas, potentially disturbing Florida’s tropical paradise appeal. We recommend avoiding Broward, Orange and Seminole counties if you prefer to avoid crowds.

Criteria Rank
Affordability 8th
Quality of Life 5th
Heathcare 39th
RL Rating 1st

NEW HAMPSHIRE

New Hampshire | Retirement Living

New Hampshire is ideal for active retirees, offering beaches, lakes, mountains, cities and countryside. Health care resources are readily available even in rural areas. Seniors make up nearly 20% of the population, so retirees can find many peers with similar interests.

Home prices are affordable for most people, but the state has one of the country’s highest real estate transfer taxes. There’s no tax on retirement income, so New Hampshire’s affordability index is above average.

From Our Readers:

  • “It has everything I need. 55+ community, near by shopping, top rate docs, no sales tax.”
  • “Overall cost of living, lack of onerous taxes, and a favorable political climate”
  • “Low crime, good healthcare and education..”

New Hampshire’s four seasons provide a welcome change, but winter snow and ice can be hazardous. If you choose to live in a city, you may have to deal with some crowding. Independent living communities are readily available in most areas.

Criteria Rank
Affordability 2nd
Quality of Life 1st
Heathcare 8th
RL Rating 7th

ARIZONA

Arizona | Retirement Living

Arizona rose from the ninth spot last year to the third-best state for retirement for 2022. The state offers affordable living and a warm, dry climate that draws many retirees. The typical Arizona retirement community is established on a golf course and includes a gym and pool.

From Our Readers:

  • “Weather, low property taxes, lots of other seniors, beautiful landscape.”
  • “Don’t have to shovel snow”
  • “Overall cost of living is low plus no state tax in SSN and Military pension.”

Arizona is one of the few states where you can go skiing and swim outside on the same day.

Activities include civic events, art fairs, skiing, golf, biking and hiking. Whether you walk or drive, you can visit beautiful landscapes from the mountains to the Grand Canyon.

Property taxes are reasonable, although there is a tax on retirement income. If you’re uncomfortable with high temperatures, you may want to consider another state. The overall state crime rate is down, but you should look into a home security system if you live in the city.

Criteria Rank
Affordability 26th
Quality of Life 25th
Heathcare 47th
RL Rating 3rd

NORTH CAROLINA

North Carolina | Retirement Living

Retire to North Carolina for a comfortable climate that’s not quite as warm as Florida. History buffs, hikers and beach bums can easily find recreation in the state. North Carolina colleges offer residents over age 65 free college classes.

From Our Readers:

  • “Lot’s of outdoor activities, great weather, good healthcare, nice people.”
  • “It has everything we want, beauty, good health care, great weather.”
  • “The climate, roads, cost of living, beaches, mountains, population.”

The median home price is lower than most states, and North Carolina does not tax Social Security retirement benefits. Other retirement income is taxed at a flat 5.25% rate, and the sales tax is low.

Establishing friendships with other retirees is not difficult, given that they make up over 17% of the population. Our readers love retirement life in North Carolina (reflected in the high RL Rating), and you’ll find plenty of senior housing options. Stay out of cities if you want to keep your cost of living down, and consider another state if you prefer snowy winters.

Criteria Rank
Affordability 29th
Quality of Life 36th
Heathcare 35th
RL Rating 4th

ALASKA

Alaska | Retirement Living

While retiring to Alaska isn’t for everyone, our readers living in the state give it high marks. The median home price across the state is affordable, although it’s higher in cities like Juneau and Anchorage. Alaska is one of the few states with a very low poverty rate.

From Our Readers:

  • “It’s home.”
  • “We have lived here for more than 20 years.”

If you’re considering working after retiring from your career, you’ll pay no income tax in Alaska. There’s also no state sales tax and no tax on unearned income. Alaskan residents receive an annual payment from the Alaska Permanent Fund, funded by state oil revenues.

Alaska is appealing to those who enjoy the great outdoors. There’s no shortage of day tours, multiday adventure tours, sightseeing via airplane, fishing charters, dog sledding and more. The downside is traveling to the mainland can get expensive. Of course, we only recommend retiring in Alaska if you like cool weather.

Criteria Rank
Affordability 1st
Quality of Life 42nd
Heathcare 12th
RL Rating 17th

TEXAS

Texas | Retirement Living

Texas’ median income is up, but so are home prices and property taxes. The increased expense is balanced by the lack of an income tax and the senior homestead exemption. The number of retirees in the state is lower than in others on our list, but there’s still much to do and see in Texas.

From Our Readers:

  • “Veteran friendly, no income tax, close to health care.”
  • “They welcome seniors with open arms in the Rio Grande Valley. It costs less as well.”

The friendly people, wide-open spaces and exciting cities, like El Paso and Dallas, make Texas a great place to retire. Sightseeing opportunities include several historic venues like the Alamo, Victorian mansions and a former sugar cane plantation. There are also plenty of recreational areas and fishing and hunting opportunities.

  • Moderate temperatures with variations across the state.
  • Be aware of hurricanes near the coast and tornadoes statewide.
Criteria Rank
Affordability 3rd
Quality of Life 48th
Heathcare 48th
RL Rating 2nd

SOUTH DAKOTA

South Dakota | Retirement Living

South Dakota is an affordable state to retire in, with many options for health care. There’s no tax on retirement or regular income, and the median home price is low compared to most other states. Retirees will find that hospitals are plentiful, and South Dakota has more health care workers per capita than any other state in our top 10 retirement states.

Winter weather is cold and snowy in South Dakota but comfortable for most of the remainder of the year. If you prefer living on the water or like fishing, boating and similar sports, consider retiring in the northeast or central parts of the state.

  • Country or city living, depending on the region.
  • Property crime rate is 16% lower than the average across the country.
Criteria Rank
Affordability 5th
Quality of Life 23rd
Heathcare 4th
RL Rating 21st

WASHINGTON

Washington | Retirement Living

Our data shows Washington state housing costs are relatively high. If the median home price is not within your budget, check out senior living communities and compare the cost. Despite the high house prices, Washington remains affordable. There’s no tax on any income, but you should review local taxes before choosing a city for retirement as this cost is very high in some locations.

Washington offers four seasons, and it typically rains about half of the year. Summers are hot and muggy. Those who don’t tolerate humidity well may want to travel to another state for the summer. Expect drier weather from mid-September through May.

  • Beautiful coastlines, national forests and mountain ranges.
  • One of the most environmentally-conscious states in the country.
Criteria Rank
Affordability 6th
Quality of Life 21st
Heathcare 37th
RL Rating 6th

NEBRASKA

Nebraska | Retirement Living

Most retirees have no problem finding medical care in Nebraska. The state boasts a much higher than average number of health care workers, hospitals and dentists. Nebraska taxes all retirement income other than railroad benefits, but living costs are 10.5% lower than most other states.

Nebraska offers fishing, boating, golf, several entertainment venues, performing arts and more. Summers are hot and somewhat humid, with temperatures typically under 90 degrees. Winters can be extremely cold between December and February.

  • Low cost of living with a strong economy.
  • Friendly Midwestern neighborhoods.
Criteria Rank
Affordability 24th
Quality of Life 18th
Heathcare 3rd
RL Rating 33rd

ALABAMA

Alabama | Retirement Living

Our readers gave Alabama a positive rating as a retirement destination. The state has an average affordability rating, but energy costs are somewhat high. The sales tax is low, and Alabama does not tax retirement income.

With nearly 18% of the population being over age 65, retirees can easily find peers and activities in Alabama. Mild winters ease the way to getting around outdoors throughout the year. Alabama combines beaches and a rich history to offer much to do and see. Senior communities are available across the state.

  • Retirees are exempt from paying property tax.
  • Crime rates are high in some areas.
Criteria Rank
Affordability 32rd
Quality of Life 41st
Heathcare 46th
RL Rating 5th


10 Worst States for Retirement

High taxes and housing costs are a burden for residents in more of the worst states for retirement in 2022. Less state land reserved for recreation and an inadequate number of health care facilities also factored into low ratings for some states. Our readers’ surveyed opinions influenced our findings as well.

ILLINOIS

Illinois | Retirement Living

Illinois readers gave the state the lowest RL Rating of all 50 states. The sales and fuel taxes are a burden. Illinois property taxes are among the highest in the country, although there are exemptions for seniors. The eastern part of the state has an extensive toll road system, and the state is among the 20 most expensive states to live in.

Senior housing costs are moderate, and retirees can find medical care easily in most Illinois towns. If you prefer city life, consider Springfield or a Chicago suburb. You’ll enjoy four seasons in Illinois, but winters can be cold with slick driving conditions. The summers are typically hot and humid.

  • Cities offer parks, movies, museums and cultural events.
  • Small towns have fewer activities but a quiet lifestyle.
Criteria Rank
Affordability 11th
Quality of Life 30th
Heathcare 23rd
RL Rating 50th

NEW JERSEY

New Jersey | Retirement Living

New Jersey is home to a good portion of the northeastern population with more than 8 million residents, and the affordability ratio is comfortable at 4.2 out of 5. Unfortunately, property taxes there are among the highest in the nation. While the number of health care workers employed in the state is reasonable, hospitals are in short supply.

New Jersey doesn’t tax Social Security benefits but may tax other forms of retirement income. Beginning in the 2021 tax year, the New Jersey Retirement Income Exclusion is available to retirees earning less than $150,000 per year. You can’t take the exclusion if you take a part-time job unless you earn under $3,000.

December through February presents cold, damp, snowy conditions in New Jersey. July temperatures are often over 90 degrees. Spring and fall are the most comfortable times of year to venture outdoors. New Jersey offers activities throughout its cities, small towns and beaches with sports venues, wineries, skiing, surfing, theaters, historical attractions and more.

Criteria Rank
Affordability 34th
Quality of Life 17th
Heathcare 21st
RL Rating 49th

CONNECTICUT

Connecticut | Retirement Living

Connecticut is the fifth-highest-taxed state in the country, which influenced the state’s low RL Rating. Social Security benefits are taxed unless your annual earnings are less than $75,000 or $100,000 if you file jointly. While you’ll likely have no problem finding other retirees, a hospital may not be available nearby. However, a high number of health care workers, dentists and senior communities are available.

Connecticut has beautiful landscapes with mountains, valleys and scenic shorelines. Retirees enjoy fishing, boating, historical sites and tours, galleries, antique shops, and more. Of course, you’ll get your fill of fresh seafood as well.

Along with the high cost of living in Connecticut, retirees endure hot, humid summers and extremely cold winters. Traffic jams are not uncommon, and the American Transportation Research Institute recently identified several bottlenecks hindering transportation in Connecticut.

Criteria Rank
Affordability 17th
Quality of Life 10th
Heathcare 11th
RL Rating 48th

CALIFORNIA

California | Retirement Living

California is a great state for adventures, with mountains, beaches, parks and many activities within driving distance of nearly every town or city. Finding local retirees to join you on an excursion can be difficult depending on where you live, though. There are over 7 million acres of parkland in the state, but many roads are crowded.

The California property tax rate is lower than the national average, but the high home values make for a hefty tax bill. There is some property tax relief for those earning under $35,000, but it results in an arrangement comparable to a reverse mortgage with the state. Other tax relief amounts to $7,000 for your primary residence.

Big cities in California are not affordable for many retirees. Look to the many small towns across the state for options that fit your retirement budget.

Criteria Rank
Affordability 50th
Quality of Life 39th
Heathcare 28th
RL Rating 42nd

NEW MEXICO

New Mexico | Retirement Living

Over 18% of New Mexico residents are retirees, but the number of health care workers could be higher to meet that population’s needs. The state has one of the lowest cost of living indexes in the country due to affordable housing and low utility costs, but it taxes all retirement income except Railroad Retirement benefits. New Mexico’s poverty rate is over 17%, compared to an 11.36% average across the U.S.

Take a driving tour of New Mexico, and you’ll see deserts, mesas, canyons, valleys, farmland, mountains and other terrains. Sun lovers who prefer warm days love retiring in the state. Temperatures can hit over 100 degrees F, but humidity levels are low. Winter nights can be frigid, but there’s usually an abundance of sunshine for daytime warming.

New Mexico has a strong art community, and you won’t have to look far to find fairs and festivals featuring folk art, glass blowing, paintings and sculptures. Unfortunately, New Mexico’s crime rate needs to improve.

Criteria Rank
Affordability 45th
Quality of Life 46th
Heathcare 44th
RL Rating 37th

INDIANA

Indiana median home prices are relatively low, but household income is among the lowest in the country. The latest census bureau data shows that the average retiree in Indiana lives on an annual income of $20,521. Of course, you’ll probably do better if you actively save for retirement.

Indiana offers a simple, slow-paced lifestyle in much of the state. This isn’t appealing to everyone, though. You can visit or live in cities like Indianapolis or Fort Wayne, but you won’t have to look far if you prefer a farming community in a less populated area.

Criteria Rank
Affordability 13th
Quality of Life 35th
Heathcare 34th
RL Rating 44th

NEVADA

Nevada has a high affordability index but landed on our list of the worst states for retirement due to inadequate hospitals and health care staffing. Nevada’s general and retiree population continues to increase year after year. The influx of new residents combined with tourists can cause crowding even in small towns. Paying the median home price is out of reach for some retirees.

Nevada has no income tax, and property taxes are low. The state sales tax is under 5%, although county taxes can drive that number up beyond 8%. The weather is warm and dry most days, and you can enjoy the desert and go skiing in one day. Casinos and golfing are some of the entertainment options.

  • Casinos bring tourists and a high level of traffic in some areas.
  • One of the highest crime rates in the country.
Criteria Rank
Affordability 23th
Quality of Life 37th
Heathcare 50th
RL Rating 16th

NEW YORK

New York’s high housing costs and taxes combined with a low number of hospitals earn the state a place on our list of the worst states for retirement. While New York has a good affordability index, that ratio is not solely based on retirement income. Residents over the age of 65 are usually eligible for state tax relief programs.

New York weather is comfortable most days. Seniors will find plenty to do in the city, such as Broadway shows, museums, botanical gardens and fantastic restaurants. Country life offers a slower pace with beaches, mountains and wineries.

Criteria Rank
Affordability 47th
Quality of Life 34th
Heathcare 19th
RL Rating 32nd

MICHIGAN

Affordable living in Michigan depends on the region you retire in. Avoid resort areas and cities in the Lower Peninsula to find more affordable housing in less populated areas or farming communities. Regardless of where you live in Michigan, you won’t escape high taxes. The tiered retirement income tax is complicated compared to other states.

Michigan offers four distinct seasons, outdoor sports and historical venues throughout the state. Summers are longer and warmer in the Lower Peninsula. The Upper Peninsula typically has long, cold winters with occasional heavy snow.

  • Quality of life varies depending on the region.
  • High retiree population and adequate health care facilities.
Criteria Rank
Affordability 19th
Quality of Life 28th
Heathcare 24th
RL Rating 46th

COLORADO

Colorado is another state that’s ideal for the retiree who enjoys the great outdoors. Most of the state is at a high elevation with mountains and high plains. The weather varies both regionally and even at the local level. Winter snowstorms can be a challenge at the higher elevations, but days are generally seasonally cool and sunny.

Housing that’s affordable for retirement years is difficult to find in Colorado. Independent senior housing and assisted living facilities cost more than the national average, particularly in the cities. Water shortages plague some areas of the state, and tourism can cause crowding.

  • Low humidity allows for 30-degree daily temperature fluctuations.
  • Retirement income partially taxed.
Criteria Rank
Affordability 23rd
Quality of Life 26th
Heathcare 30th
RL Rating 39th

Methodology

In our search to identify the best and worst states for retirement, we evaluated 13 data sources that fall into four categories: cost of living, quality of life, healthcare, and RetirementLiving Score.

To evaluate the cost of living we standardized the median household income, average home price, affordability score, state tax rate, and the cost of assisted living care. Each of the four data points add up to 25% of the state’s final score.

When considering quality of life, we standardized the percentage of the population over 65, the percentage of the population in poverty, and number of acres of parkland compared to the total landmass of the state. This category amounts to 20% of the state’s overall score.

To compare the healthcare environments within each state, we standardized the number of hospitals per 100,000 residents, the number of health care workers per 100,000 residents, and the number of dentists per 100,000 residents. Each of the three data points are worth 5%, amounting to 15% of the state’s final score.

Finally, we surveyed our readers and received more than 300 responses. We simply asked our readers to rate their state for retirement. The scores and responses from our readers were in line with our statistical analysis, but gave us an anecdotal view into what it is like to actually retire in a particular state. This information amounted to 40% of the state’s overall score.

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