People looking for an enjoyable, affordable place to retire may find the process a bit more challenging due to the economic fallout from the pandemic. What’s worse, this is the first generation to largely be responsible for their own retirement contributions as opposed to depending on a pension plan. As a result, many are reaching retirement age with inadequate savings.
With that in mind, MoneyRates has released “Best States to Retire: 2021.†As it’s done every year since 2011, the rate-comparison and personal-finance resource site ranked all 50 states. Iowa and West Virginia share the top spot on this year’s list.
The rankings consider factors such as cost of living, taxes, safety, lifestyle and healthcare. And while many Americans dream of hanging their retirement hat somewhere with warm, sunny beaches, the two top states are far from any coastlines.
After co-leaders Iowa and West Virginia, the top 10, in order, are Arkansas and Mississippi (tied), Florida and Kentucky (also tied), Connecticut, Missouri , Alabama, and Rhode Island.
Washington? It is almost at the very bottom, with a ranking of 48th. And to add insult to injury, the Evergreen State fares only slightly better in a second national pecking order of the best and worst states for retiring.
“While climate was one of the factors we looked at, day-to-day there is a lot more to a safe and happy retirement†than warm weather, said Richard Barrington, a senior financial analyst for Money Rates and author of the study. “Economic factors are a big concern to people trying to stretch their retirement dollars. Safety from crime is essential to peace of mind. And healthcare, of course, grows in importance as people get older.
He said Iowa has a high level of nursing care capacity relative to population size. That, coupled with its strong economy, helped the state rise to the top.
West Virginia, on the other hand, scored well by having the third-lowest healthcare costs in the nation, the fifth-lowest average property tax burden, and an overall cost of living 9 percent below the national average.
Here are some other examples of haves and have-nots:
- Beauty is skin deep when choosing a retirement state. Hawaii is paradise, but 21 other states offer a cost of living that is less than half as expensive as the land of aloha.
- Alaska has more than seven times as much violent crime as Maine.
- The average property tax burden in New Jersey is more than seven times the burden in Hawaii.
- The proportion of Maine’s population that’s 65 and older is almost twice as high as Utah’s.
- The average temperature in Florida is about 70 degrees. In Alaska, it’s 26.
- The five lowest-rated states are all in the west. In order, they’re Colorado, California, Washington, Nevada, and Alaska.
“Everyone has individual priorities, plus there are personal factors that can’t be measured,†Barrington said. “The aim of this study isn’t to tell retirees where they should live. Rather, it’s to point out the range of different factors to think through when deciding where to settle in retirement.â€
The economic factors used by Money Rates include cost of living data from the Council for Community and Economic Research, property tax burdens from the Tax Foundation research organization, and unemployment rates from the federal Bureau of Labor Statistics.
For crime safety, the study used violent and property crime rates from the FBI.
Lifestyle factors, including proportion of older residents, were calculated from U.S. Census Bureau data.
The review of healthcare is based on nursing-facility capacities calculated from Census Bureau data and life-expectancy data from the national Centers for Disease Control.
