3 of the Worst States for Retirement

Making Your Money Last

3 Bad States for Retirement

Tax laws and living costs makes these states unfriendly for retirees.

Deciding where you want to retire is a personal decision. You may want to live near your grandkids, move to a place where you’ll never have to shovel snow, or even head overseas. But if you’re considering several options, it makes sense to begin by looking for places that are safe, affordable and hospitable to retirees.

See Also: 10 Best College Towns to Retire to

We rated all 50 states and the District of Columbia, and found that these three states are among the worst retirement destinations:


Let’s start with California. The cost of living there is more than a third higher than the national average. All retirement benefits except Social Security are taxed, and California imposes the highest state income taxes in the country. The median home value for those 65 and older in California is about $368,000, more than double the national median. Retirees who rent will fare no better: Monthly rental costs for renters 65-plus are the steepest in the nation.

New Mexico

New Mexico is another unfriendly state for retirees. The Land of Enchantment is one of a handful of states that tax Social Security benefits. The cost of living is about 3.6% above the national average. There's also a statewide gross receipts tax, which is similar to a sales tax, of 5.125%. County and city taxes can add another 3.56%. Crime is also higher than the national average, and the poverty rate for seniors is 12.1% versus a national average of 9.4%.


New York

Finally, retirees may want to think twice about heading to New York. The Empire State has the highest cost of living in the country. Health care and housing are particularly expensive. New York has high monthly rental costs for older renters that rival California's, and the median value of a home owned by someone 65 or older is about $270,000, nearly two-thirds more than the U.S. median value. Homeowners also face some of the highest property taxes in the country.

See 12 more of the worst states for retirement, plus take a look at the 10 best states for retirees.