The Absolute Cheapest States To Retire In 2026

After dedicating decades to their careers, many individuals look forward to a fulfilling retirement. For a significant number of retirees, this means relocating to a more affordable area. According to recent data, over 500,000 adults aged 65 and older moved to different states last year alone. However, not every state is ideal for retirement; many can leave retirees financially strained.

So, where should retirees consider moving to maximize their savings and enjoy a comfortable lifestyle?

The Most Affordable States for Retirement in 2026

While many retirees consider traditional destinations like Florida, the southern states offer a combination of affordable housing and lower living costs, making them prime locations for retirement. Continue reading to learn how we determined these rankings or scroll to the end to see where your state stands.

How We Determined the Most Affordable States for Retirement

We evaluated each state on a scale from 1 to 50 based on the following criteria:

Median Home Cost
Monthly Homeowner Costs
Cost of Living
Medicare Advantage Costs
State Medicare Spending Per Person

We began by analyzing median housing costs using data from the ACS Census. Transitioning from a state with high housing costs to one with lower prices can greatly enhance a retiree’s quality of life and extend their retirement savings. The more affordable the housing, the better for a retirement lifestyle.

Next, we gathered data on monthly homeowner costs from the ACS, focusing on the percentage of seniors who spend 30% or more of their income on housing. A lower percentage indicates a more favorable environment for retirees. Additionally, we referenced cost of living data to give context to the expenses retirees might incur in each state. Even minor expenses can accumulate significantly over time.

Healthcare costs were also a key factor. While it’s possible to economize on various daily expenses, healthcare is a necessary consideration. As healthcare costs continue to rise, this aspect is crucial for retirees who desire financial security.

We evaluated Medicare Advantage Costs using data from The Kaiser Family Foundation. Note that Alaska lacks individual Medicare Advantage plans, thus it was excluded from this metric. We also considered state contributions to Medicare per resident. Higher spending on Medicare generally benefits seniors.

1. Mississippi

Mississippi State Capitol
Median Home Cost: $114,500
Medicare Advantage Monthly Cost: $38.56
Cost of Living: $46,084

Mississippi ranks as the most affordable state for retirement in the U.S. With a median home price of just $114,500, retirees moving from higher-cost areas can save significantly. Coupled with low property taxes and pleasant weather, it’s clear why many retirees are considering the Magnolia State.

2. Arkansas

Arkansas State Capitol
Median Home Cost: $123,300
Medicare Advantage Monthly Cost: $44.49
Cost of Living: $44,571

Arkansas offers mild weather and numerous outdoor activities for active retirees. While home prices slightly exceed those in Mississippi, they remain affordable at a median price of $123,300. Additionally, seniors in Arkansas tend to spend a lower proportion of their income on housing compared to other states.

3. Oklahoma

Oklahoma State Capitol
Median Home Cost: $130,900
Medicare Advantage Monthly Cost: $48.49
Cost of Living: $46,613

Oklahoma is a budget-friendly choice for retirees. While it may not boast the warm beaches that many envision, it offers affordable housing and low monthly homeowner costs that can enhance a retiree’s financial stability.

4. West Virginia

West Virginia State Capitol
Median Home Cost: $115,000
Medicare Advantage Monthly Cost: $59.75
Cost of Living: $44,823

West Virginia ranks fourth, offering significant affordability for retirees. Its location near the upper East Coast makes it attractive for those seeking a budget-friendly alternative to the expensive Northeast.

5. Indiana

Indiana State Capitol
Median Home Cost: $135,400
Medicare Advantage Monthly Cost: $48.04
Cost of Living: $46,838

Indiana’s affordable housing and low monthly costs make it a strong contender for retirees. Although it may not have the warm climate of some other top states, it offers a pleasant change of seasons that many find appealing.

6. Louisiana

Louisiana State Capitol
Median Home Cost: $157,800
Medicare Advantage Monthly Cost: $41.98
Cost of Living: $47,975

Louisiana ranks sixth among states for budget-friendly retirement. In addition to its renowned cuisine, retirees can enjoy affordable housing, lower living costs, and reasonable healthcare expenses.

7. Kentucky

Kentucky State Capitol
Median Home Cost: $135,300
Medicare Advantage Monthly Cost: $56.36
Cost of Living: $43,308

Often recognized for its bourbon and horse racing, Kentucky is also a highly affordable state for retirees. With a median home price of $135,300, it offers significant savings compared to neighboring states like Illinois and much more than states like Hawaii.

8. Missouri

Missouri State Capitol
Median Home Cost: $151,600
Medicare Advantage Monthly Cost: $43.15
Cost of Living: $46,159

Missouri strikes a balance between affordability and lifestyle, making it an excellent choice for retirees. While housing is reasonable and the cost of living is manageable, healthcare costs could be more favorable.

9. Alabama

Alabama State Capitol
Median Home Cost: $137,200
Medicare Advantage Monthly Cost: $51.88
Cost of Living: $45,824

While Florida is often seen as the go-to state for retirement, Alabama offers similar coastal benefits at a much lower cost. With a Medicare Advantage monthly cost of $51 and a low percentage of seniors burdened by housing costs, Alabama deserves attention.

10. Tennessee

Tennessee State Capitol
Median Home Cost: $158,600
Medicare Advantage Monthly Cost: $46.02
Cost of Living: $46,785

Tennessee ranks tenth for affordability in retirement. Beyond its low living costs, it boasts a vibrant music scene and stunning natural landscapes, enhancing the quality of life for retirees.

Summary of the Most Affordable States for Retirement

While some retirees might have the luxury to choose any location, most must consider the impact of their retirement destination on their quality of life and financial health. The ten states listed above offer the most affordable options for retirement, allowing retirees to stretch their savings further.

It’s crucial to remember that these rankings are based on state-wide data, so costs can vary widely within different cities. Which states should retirees steer clear of to avoid financial strain?

The Most Expensive States for Retirement

The Cheapest States to Retire, Ranked from Most Affordable to Least

Rank	State	Avg. Home Price	Cost of Living	Medicare Spending Per Residence
1	Mississippi	114,500	46,084	11,021
2	Arkansas	123,300	44,571	9,479
3	Oklahoma	130,900	46,613	10,429
4	West Virginia	115,000	44,823	10,268
5	Indiana	135,400	46,838	10,714
6	Louisiana	157,800	47,975	11,811
7	Kentucky	135,300	43,308	10,368
8	Missouri	151,600	46,159	10,457
9	Alabama	137,200	45,824	10,267
10	Tennessee	158,600	46,785	10,371
11	Iowa	142,300	48,882	9,317
12	Ohio	140,000	45,853	11,038
12	South Carolina	154,800	46,568	10,298
14	Georgia	166,800	47,946	10,429
15	Texas	161,700	48,160	11,895
16	Nebraska	147,800	48,076	9,956
17	Florida	196,800	52,206	12,229
18	Wyoming	213,300	47,951	9,050
19	Kansas	145,400	48,054	10,126
20	Utah	256,700	47,922	9,084
20	North Carolina	165,900	49,575	10,260
22	Michigan	146,200	48,837	11,318
22	South Dakota	159,100	45,410	9,315
24	North Dakota	185,000	46,814	9,461
25	Pennsylvania	174,100	49,914	11,243
26	Alaska	265,200	54,400	9,288
27	Montana	219,600	47,083	8,238
28	Arizona	209,600	51,341	10,096
29	Idaho	192,300	45,801	8,737
29	Maine	184,500	51,305	9,325
31	New Mexico	166,800	48,050	8,663
32	Delaware	244,700	53,112	11,460
33	Illinois	187,200	52,304	11,116
34	Nevada	242,400	52,698	10,796
35	California	475,900	57,315	11,833
36	Maryland	305,500	58,178	12,000
37	Wisconsin	173,600	51,120	9,608
38	New York	302,200	59,128	12,179
39	Virginia	264,900	54,264	9,677
40	Rhode Island	249,800	53,240	10,901
41	Minnesota	211,800	52,115	9,917
42	New Hampshire	252,800	55,103	9,397
43	Connecticut	272,700	59,502	11,964
44	New Jersey	327,900	56,109	12,614
45	Vermont	223,700	51,977	9,231
46	Massachusetts	366,800	59,560	11,899
47	Washington	311,700	51,271	8,997
48	Oregon	287,300	51,900	8,942
49	Colorado	313,600	53,792	9,287
50	Hawaii	587,700	60,700	8,592

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Author

Kathy Morris

Kathy is the head of content at Zippia with a knack for engaging audiences. Prior to joining Zippia, Kathy worked at Gateway Blend growing audiences across diverse brands. She graduated from Troy University with a degree in Social Science Education.

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