The Fallacy of State Income Tax Focus
One must also look at things like sales taxes, fuel taxes, property taxes and especially as for senior citizens medical/dental deductions, and retirement income taxes. For senior citizens, most states give a tax break to people over a certain age, but to qualify, one may have to have a low-level income. All of these factors must be looked at, and taken into account before one can decide what the cheapest state to retire in is.
What are the cheapest states by most standards?
In general, the Midwest and the South are the cheapest places to live in the country. Conversely, the West Coast, New English, Alaska and Hawaii are continually ranked as the most expensive. In terms of the states themselves, the Missouri Economic Research and Information Center lists the following states (#1 to #10) as the most affordable:
6. South Dakota
However, according to MoneyRates.com, the top ten best states to live in (based on living costs in major metropolitan areas, unemployment, climate, tax burden, violent and property crime rate, life expectancy, and tax burden) are:
1. New Hampshire
3. South Dakota
4. North Dakota
Although one would think that these two lists would be fairly congruent, the fact of the matter is, the cheapest state to retire in, and the best state to retire in, are simply two different things, and oftentimes having a higher quality of life simply means being willing to pay for it. Such as in the case of Hawaii, this is the one of the most expensive places to retire, but still ranked as #2 as the best place to retire.
Of all the states listed on these two lists however, the only one that is consistent between the two of them is South Dakota, so if in doubt, that may be a good place to consider.
Also, although as a state it made it onto neither the best nor the cheapest state to retire in list, Florida also holds three towns which are among the top 20 places to retire, North Miami Beach, Indian Rocks Beach, and Rotonda, so in considering which state to retire in, it should also be looked into.
Although the best state and the cheapest state to retire in may not be the same place, in searching for either, one should take time and do their homework before deciding to move there. Doing so will not only result in finding a place that matches one of the scales, but hopefully both.
Return to the Best Cities to Retire In Page