The Absolute Cheapest States To Retire In 2020

After a lifetime of work, many look forward to a comfortable retirement.

For many a comfortable retirement means moving, according to the latest US Census bureau over half a million of adults over 65 moved states last year alone. However, not all states are a great place to retire. In fact, a lot of states will leave retirees just scraping by.

Where should retirees go to make the most of their retirement savings and live well for less?

The Cheapest States To Retire

Forget Florida and the west and east coasts. More retirees should be looking towards the south when planning their retirement. Affordable housing and low cost of living make the south the place to be for retirees. Keep reading to see how we determined this, or scroll to the bottom to see where your state lands.

How We Determined The Most Expensive States To Retire

We ranked each state 1 to 50 on the following factors:

Median House Cost
Monthly Home Owner Cost
Cost Of Living
Medicare Advantage Cost
State Medicare Spend Per Person

First, we examined median housing costs using data from the ACS Census. Moving from a state with expensive housing costs to one with cheaper housing costs can drastically elevate retirees standard of living and significantly add to their retirement fund. The cheaper the housing, the better to retire.

Next we pulled in monthly home owner costs from the ACS. We looked at the percentage of people over 65 who are spending 30% or more of their income on house. The lower the cost, the better for retirement. We then used our data on cost of living to provide more context to the costs seniors can expect to face in each state. Living is expensive, even small expenses like toothpaste and a cup of coffee, can add up.

Finally, we examined the cost of healthcare. You might be able to cut coupons or downsize your house, but you can’t choose not to get sick. This area is especially important because healthcare costs continue to rise each year and leaves many seniors scrambling.

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First, we examined Medicare Advantage Costs, using data from The Kaiser Organization. Note, Alaska does not have individual Medicare Advantage plans so was excluded from this metric. We then looked at state’s contributions to Medicare per residence. The more a state spends on Medicare, the better for seniors.

1. Mississippi

mississippi
Median Home Cost: $114,500
Medicare Advantage Monthly Cost: $38.56
Cost Of Living: $46,084

Mississippi is the most affordable state to retire in the whole country. The median home price in Mississippi is only $114,500, which means retirees relocating from more expensive states can expect to pocket quite the stack of cash. Add in low property taxes and warm, sunny weather and it’s easy to see more retirees should give the Magnolia state a second look.

2. Arkansas

arkansas
Median Home Cost: $123,300
Medicare Advantage Monthly Cost: $44.49
Cost Of Living: $44,571

Arkansas mild weather and plenty of outdoor activities for retirees who anticipate an active retirement. While Arkansas homes are a smidge more expensive than Mississippi, home prices are still affordable with a median price of $123,300. Arkansas homeowners over 65, also spend a smaller chunk of their income on home owner costs than other states.

3. Oklahoma

oklahoma
Median Home Cost: $130,900
Medicare Advantage Monthly Cost: $48.49
Cost Of Living: $46,613

Oklahoma is the third cheapest state to retire. While Oklahoma doesn’t have the warm beaches many retirees dream of calling home, it does have affordable homes and low monthly home owner costs. That’s nice.

4. West Virginia

west virginia
Median Home Cost: $115,000
Medicare Advantage Monthly Cost: $59.75
Cost Of Living: $44,823

In fourth place we have West Virginia. The mountain state has affordability in spades. West Virginia’s location near the upper-east coast makes it particularly appealing for those looking to retire away from the expensive Northeast but don’t want to go far.

5. Indiana

indiana
Median Home Cost: $135,400
Medicare Advantage Monthly Cost: $48.04
Cost Of Living: $46,838

Cheap housing, low monthly housing costs, and a favorable cost of living push Indiana ahead of its neighbors. While it may not be as warm as other states in the top 10, Indiana still has a lot to offer retirees. Some people enjoy experiencing more than two seasons.

6. Louisiana

louisiana
Median Home Cost: $157,800
Medicare Advantage Monthly Cost: $41.98
Cost Of Living: $47,975

The Bayou state is the 6th best state for retiring on a budget. In addition to delicious food, Louisiana retirees can expect low costs of living, affordable homes, and lower healthcare costs.

7. Kentucky

kentucky
Median Home Cost: $135,300
Medicare Advantage Monthly Cost: $56.36
Cost Of Living: $43,308

If all you about Kentucky is Bourbon and horse races, you may not know the state is seriously affordable. The median home price is only $135,300– 50,000 less than neighboring Illinois and 400,000 than expensive Hawaii. Kentucky also has the lowest cost of living in the nation. Go Kentucky.

8. Missouri

missouri
Median Home Cost: $151,600
Medicare Advantage Monthly Cost: $43.15
Cost Of Living: $46,159

Sandwiched between the south and west, Missouri is a great choice for retirees looking to live well on a budget. Reasonable housing and affordable cost of living mean retirees can enjoy more luxuries than in a pricier states. What keeps Missouri from ranking higher? Healthcare costs could be cheaper.

9. Alabama

alabama
Median Home Cost: $137,200
Medicare Advantage Monthly Cost: $51.88
Cost Of Living: $45,824

Many retirees may think Florida when they think retirement, but more should look to its neighbor Alabama. Swap out the Atlantic Ocean for Alabama’s Gulf of Mexico and you could save a bundle. Alabama has a Medicare Advantage monthly cost average 51$, and only 15% of residents over 65 are overburdened by home owner costs.

10. Tennessee

tennessee
Median Home Cost: $158,600
Medicare Advantage Monthly Cost: $46.02
Cost Of Living: $46,785

Tennessee is the 10th most affordable state to retire. In addition to affordability, Tennessee overs a vibrant country music scene, the beautiful smokies,

Summary On The Cheapest States To Retire

Look, maybe you have a small fortune to spend on your retirement and can comfortably retire anywhere. But for most people that isn’t the case. Where they choose to retire will drastically impact their quality of life and help (or hinder) stretch their retirement savings. The 10 states above are the cheapest states to retire in the nation.

Retirees should keep in mind this data is statewide, so costs may vary based on cities. Which states should retirees avoid if they don’t want to drain their retirement savings?

The Most Expensive States To Retire

The Cheapest States To Retire, 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

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.