The 10 Most Expensive States To Retire (And The Least Expensive)

For many, the ultimate career goal is to enjoy a fulfilling retirement.

While we hope that work isn’t a source of dread, a significant number of individuals eagerly anticipate retirement. Transitioning into this new phase of life allows for the pursuit of personal passions, hobbies, and precious time spent with loved ones.

As retirees often seek a more suitable environment for their leisurely lifestyle, many decide to relocate to optimize their retirement savings. According to recent data, over half a million adults aged 65 and over moved to different states last year.

However, not every state is a conducive retirement haven. Some states present challenges that can significantly impact retirees’ financial stability.

So, which states should retirees be cautious of to avoid financial strain?

The Most Expensive States To Retire

1. Hawaii
2. Colorado
3. Oregon
4. Washington
5. Massachusetts
6. Vermont
7. New Jersey
8. Connecticut
9. New Hampshire
10. Minnesota

These states, marked by high living costs, can leave retirees struggling financially. Notably, the Northeast is particularly expensive, with five of the ten most costly states for retirement located in this region. Continue reading to learn why these states can be financially burdensome or scroll down to explore the most affordable places to retire.

How We Determined The Most Expensive States To Retire

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

• Median Home Cost

• Monthly Home Owner Cost

• Cost Of Living

• Medicare Advantage Cost

• State Medicare Spending Per Capita

Our analysis began with median housing costs, utilizing data from the ACS Census. Moving from a state with high housing costs to one with lower costs can dramatically improve a retiree’s quality of life, while the opposite can have detrimental effects. Although many seniors dream of retiring in Hawaii, its exorbitant housing prices leave little room for financial comfort.

Next, we examined monthly home owner costs from the ACS, focusing on the percentage of seniors spending 30% or more of their income on housing. Higher costs indicate greater financial strain on retirees. We incorporated our research on cost of living to shed light on the expenses retirees can expect across states. Everyday costs can add up quickly.

Lastly, we assessed healthcare costs. While retirees may find ways to cut back on expenses, healthcare is often unavoidable. This area is critical, as healthcare costs continue to climb, leaving many seniors in precarious situations.

We analyzed Medicare Advantage Costs using data from The Kaiser Organization. Please note that Alaska lacks individual Medicare Advantage plans, so it was excluded from this metric. We also reviewed state contributions to Medicare per capita. Higher state expenditures on Medicare tend to benefit seniors.

1. Hawaii

Median Home Cost: $587,700
Medicare Advantage Monthly Cost: $96.40
Cost Of Living: $60,700

While Hawaii is often viewed as a tropical paradise, retirees dreaming of its beaches might consider Florida or the Gulf Coast for a more affordable option. Hawaii’s cost of living is the highest in the nation, with its median home price of $587,700 creating a staggering $473,200 gap compared to Mississippi’s average home price.

2. Colorado

Median Home Cost: $313,600
Medicare Advantage Monthly Cost: $89.52
Cost Of Living: $53,792

Colorado’s breathtaking scenery may entice retirees, but the cost of living can be daunting. It ranks fifth in the nation for home prices, and its Medicare spending per capita falls behind 40 other states, adding to the financial challenges.

3. Oregon

Median Home Cost: $287,300
Medicare Advantage Monthly Cost: $75.28
Cost Of Living: $51,900

Oregon may not rival Hawaii in home prices, but its median home cost of $287,300 still poses a significant financial hurdle for many retirees. Coupled with low Medicare spending, it creates a challenging financial landscape for seniors.

4. Washington

Median Home Cost: $311,700
Medicare Advantage Monthly Cost: $84.50
Cost Of Living: $51,271

Washington also presents a tough financial situation for retirees, as it has high Medicare Advantage costs and relatively low Medicare spending per capita, making it less affordable for seniors.

5. Massachusetts

Median Home Cost: $366,800
Medicare Advantage Monthly Cost: $85.56
Cost Of Living: $59,560

Massachusetts ranks as the fifth most expensive state for retirement, with a median home value of $366,800 and one of the highest living costs in the nation. Many retirees find it more advantageous to relocate south for more comfortable living conditions.

6. Vermont

Median Home Cost: $223,700
Medicare Advantage Monthly Cost: $58.66
Cost Of Living: $51,977

Vermont, known for its scenic beauty, can be unexpectedly costly for retirees. With 27% of seniors spending over 30% of their income on housing, it may not be the ideal retirement destination for many.

7. New Jersey

Median Home Cost: $327,900
Medicare Advantage Monthly Cost: $75.18
Cost Of Living: $56,109

New Jersey’s appealing location near NYC may attract some retirees, but its high median home prices and living costs often compel seniors to seek more affordable states.

8. Connecticut

Median Home Cost: $272,700
Medicare Advantage Monthly Cost: $71.06
Cost Of Living: $59,502

Connecticut remains one of the most expensive states for retirement, with a high cost of living and costly monthly home expenses that can strain retirees’ budgets.

9. New Hampshire

Median Home Cost: $252,800
Medicare Advantage Monthly Cost: $48.67
Cost Of Living: $55,103

New Hampshire is the ninth most expensive state to retire in, with over 25% of seniors spending a significant portion of their income on housing costs, leaving less for leisure activities.

10. Minnesota

Median Home Cost: $211,800
Medicare Advantage Monthly Cost: $111.62
Cost Of Living: $52,115

While Minnesota may be favorable for working families, it can be burdensome for retirees. Despite having the lowest median home cost in the top ten, elevated healthcare costs leave little room for financial flexibility.

Summary of the Most Expensive States to Retire

For those with substantial retirement savings, selecting a location may be less of a concern. However, for most retirees, the choice of state significantly affects their quality of life and the longevity of their savings.

It’s important to remember that these figures are averages for entire states; costs can vary considerably by city.

The Cheapest States To Retire

1. Mississippi
2. Arkansas
3. Oklahoma
4. West Virginia
5. Indiana
6. Louisiana
7. Kentucky
8. Missouri
9. Alabama
10. Tennessee

Ranking of the Most Expensive States to Retire

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.