Why Northfield, Minn., Is a Great Place to Retire

Just outside the Twin Cities, Northfield is a welcoming college town enveloped by pristine nature.

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Population:

20,455

Nearest large city:

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Minneapolis–St. Paul

What $300,000 will buy:

4-bedroom, 2-bath 1920s bungalow with detached garage close to downtown

The Cannon River runs through town, and several parks and walking paths provide access to fishing, canoeing and kayaking. Fitness buffs have plenty of options: In the snowy Minnesota winter, you can cross-country ski along miles of groomed trails or snowshoe through Carle­ton’s Cowling Arboretum. Too cold outdoors? Run, swim or take exercise classes at the YMCA Community Center. No need to worry about health care, either. If you need access to specialists not available at Northfield Hospital & Clinics, the Mayo Clinic is 50 miles away, in Rochester.

The median home price in Rice County is $217,300, but the inventory of homes for sale is tight, says Jan Stevens, a real estate agent who helped the Davises. A few condos have been built downtown on the river, but they’re multilevel and tend to be high-end, she says. When the Davises couldn’t find what they wanted, they built a three-bedroom, two-and-a-half-bath home that will allow them to age in place. The median annual property tax paid in Rice County is $2,057.

Minnesota isn’t a tax-friendly state for retirees. Income and sales tax rates are high, and Social Security income is taxed to the same extent it is on your federal return. The state also has an estate tax, which excludes up to $2.1 million in 2017; the exclusion will increase to $2.4 million in 2018.

Patricia Mertz Esswein
Patricia Mertz Esswein
Contributing Writer, Kiplinger's Personal Finance
Esswein joined Kiplinger in May 1984 as director of special publications and managing editor of Kiplinger Books. In 2004, she began covering real estate for Kiplinger's Personal Finance, writing about the housing market, buying and selling a home, getting a mortgage, and home improvement. Prior to joining Kiplinger, Esswein wrote and edited for Empire Sports, a monthly magazine covering sports and recreation in upstate New York. She holds a BA degree from Gustavus Adolphus College, in St. Peter, Minn., and an MA in magazine journalism from the S.I. Newhouse School at Syracuse University.