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All Contents © 2019The Kiplinger Washington Editors
By Stacy Rapacon, Online Editor
| July 13, 2018
Where you ultimately choose to retire doesn't always come down to dollars and cents. Indeed, the top reason people move in retirement is to be closer to family, according to a survey by Merrill Lynch and Age Wave, a research firm focused on the aging population. Or, rather than move, maybe you just want to stay put in retirement in a place that’s comfortable and familiar. For whatever reason, you may wind up retiring in a place where the living costs can be relatively high.
But it can be worth it. We pinpointed one great retirement destination in each state, taking into account safety, median incomes and poverty rates for retirement-age residents, locals’ sense of well-being, and the availability of recreational and health care facilities, as well as living expenses. While the cost of living in each of these 16 retirement spots exceeds the national average by 10% or more, each offers plenty of attractive advantages for retirees to offset the higher price tag. It's worth noting, too, that most people in these expensive areas can afford the living costs, given their typically higher-than-average household incomes. Take a look to see if any of these pricey places to retire are worth fitting into your own budget.
The list is ordered by cost of living, from lowest to highest. See "How We Picked the Best Places to Retire" at the end of the list for details on our data sources and methodology.
Share of population 65+: 20.9%
Cost of Living: 10% above the national average
Average Income for Households 65+: $56,465
Community Score: n/a
State's Tax Rating for Retirees: Not Tax Friendly
New England is notoriously expensive, but Pittsfield offers a small pocket of relative affordability—more reasonably priced than Boston, where living costs are 48.2% above the U.S. average. Housing is notably affordable: The median home value in the city located in the western part of the state is $170,900, compared with $341,000 for all of Massachusetts and $423,300 for Boston proper.
Leaf peeping in the fall may be enough to draw you to the Berkshires. But you have plenty to enjoy all year round, including excellent sites for camping, fishing, hiking and skiing. Nearby, enjoy musical performances at the Tanglewood Music Center, the summer home of the Boston Symphony Orchestra. There’s world-class art at the Clark Art Institute in Williamstown and the Massachusetts Museum of Contemporary Art (MASS MoCa, for short) in North Adams.
Share of population 65+: 12.2%
Cost of Living: 11.9% above the national average*
Average Income for Households 65+: $57,856
Home to Cornell University and Ithaca College, the city is a good retirement choice for lifelong learners. Cornell offers people age 60 and older discounted rates of $131 per credit for auditing classes. Breaking down regular tuition rates, classes typically cost more than $1,200 per credit hour. Ithaca College has a partnership with Longview, a local assisted-living community that gives residents access to education, health-related assessments, recreational activities and more. Ithaca is also the home base for Tompkins County's Lifelong program, which seeks to foster an age-friendly community, offering classes, social activities, a travel program and other opportunities.
Potential downsides to retiring in Ithaca: high costs and low winter temperatures. Living expenses are relatively affordable for the Empire State, but they still sneak above the national average. For example, the median home value in Ithaca is $219,100—less than the $286,300 for New York State, but more than the $184,700 for the U.S. Still, most older residents seem to make it work: Folks age 65 and up sport above-average incomes and a very low poverty rate of just 4.4%, compared with 9.3% for the same age group across the U.S.
*Provided by Sperling's Best Places.
Population: 2.8 million
Share of population 65+: 11.6%
Cost of Living: 12.0% above the national average
Average Income for Households 65+: $60,235
Community Score: 63.4
State's Tax Rating for Retirees: Mixed
Colorado ranks fourth in the United Health Foundation's senior health rankings, and Denver plays a healthy role in that rating. Indeed, the Milken Institute, a think tank, ranked the metro area the 12th best big city for successful aging in large part due to Denver’s healthy and active senior population.
Other strengths of the area include high employment and economic stability, as well as quality infrastructure, with well-funded transit for older adults, highly rated nursing homes and ample continuing care. Indeed, the Denver metro area is home to more than 25 health care facilities per 1,000 seniors, compared with just 19 per 1,000 seniors in the U.S.
Share of population 65+: 17.1%
Cost of Living: 13.6% above the national average
Average Income for Households 65+: $47,036
Community Score: 65.8
The largest city in Maine, Portland offers a lively downtown and plenty of urban-esque amenities amidst the great outdoors of the Pine Tree State. You can enjoy museums, theaters and an array of eclectic dining. The flagship L.L. Bean store in nearby Freeport is a must-see for many visitors, but resident shoppers also flock to Portland’s unique boutiques and outlets.
All the while, you’re never too far from the area's many beaches. That means ample opportunity to lounge on the shore or dive into water-based activities including fishing, kayaking, sailing and even surfing. And of course, hiking and biking trails abound—perfect in the (much) colder months, too, for cross-country skiing and snowshoeing.
Share of population 65+: 13.9%
Cost of Living: 15.0% above the national average
Average Income for Households 65+: $56,636
Community Score: 62.1
State's Tax Rating for Retirees: Most Tax Friendly
The Manchester metro area, including Nashua, may come with relatively high living costs, but the above-average household incomes help make them manageable. The Granite State's rock-solid tax advantages help, too. It’s a big reason why we recently ranked New Hampshire the ninth best for retirement.
Plenty of amenities make the area appealing to retirees. You can find a nice selection of restaurants in town and plenty of outdoor recreation to enjoy, including nearby snowshoeing, hiking, skiing and just taking in the scenic mountain views. And when you need a big-city escape—the city population of Manchester is just 111,196, after all—Boston is only an hour away.
Share of population 65+: 19.8%
Cost of Living: 16.9% above the national average*
Average Income for Households 65+: $56,879
State's Tax Rating for Retirees: Least Tax Friendly
Sunny Santa Fe would be nice for your retirement. The city is close to the Sangre de Cristo Mountains, which provide a great site for hiking and biking for the majority of the year. In winter, ski slopes are within a half-hour drive. And indoor entertainment abounds, with 250 art galleries, 12 museums and a downtown full of shops and restaurants.
Affordability may be the area's dark cloud. The median home value is $259,700, much higher than the state's median of $161,600 and the nation's median of $184,700. Retirees might not even get much of a break on taxes—Social Security benefits are subject to state tax, which contributed to making New Mexico one of our worst states for retirement.
Share of population 65+: 13.5%
Cost of Living: 20.7% above the national average
Average Income for Households 65+: $51,483
Community Score: 64.2
This small mountain city on the shores of Lake Champlain is a picturesque setting for tree-hugging retirees. Outdoor recreation is plentiful with miles of hiking and biking paths, nearby beaches where you can swim, kayak or paddleboard in the warmer months, and numerous skiing options in the area. An eco-friendly vibe permeates the town, from the businesses bolstering the city's economy, such as household-products maker Seventh Generation, to the local food movement feeding the neighborhood.
But being green isn't easy on your wallet. Taxes and living costs are high. The median home value is $218,900 in the Green Mountain State and $264,300 in Burlington. A private room in a metro area nursing home costs an annual median of $118,260, compared with $97,455 for the U.S. At least you can save money on academic pursuits. The University of Vermont will cover tuition costs for state residents age 65 and older who wish to take a class, even if it's for credit.
Share of population 65+: 12.0%
Cost of Living: 22.3% above the national average*
Average Income for Households 65+: $68,454
Community Score: 66.3
Another college town well suited to retirees, Ann Arbor is home to the University of Michigan with all its educational programs (including the Osher Lifelong Learning Institute), sporting events and cultural affairs. The university also runs the Geriatrics Center & Institute of Gerontology, which focuses on health care issues that come with aging. Along with its research facilities, medical facilities and staff, the Center offers programs and classes to help older adults maximize their good health and independence.
In fact, Ann Arbor's health care facilities are top-notch, earning it a sixth-place ranking among small metro areas for successful aging, according to the Milken Institute. There are 22.5 health care facilities per 1,000 seniors in the metro area, compared with just 19 per 1,000 seniors in the U.S. Along with quality health care, Milken recognizes the area's public transportation options as a winning attribute for older residents. A downside, however, is affordability. The median home value is $250,200, versus $127,800 for the rest of the state.
Share of population 65+: 29.5%
Cost of Living: 24.7% above the national average*
Average Income for Households 65+: n/a
Two hours from both Boston and New York City, Niantic offers a quiet and cozy retirement destination. The small town on the Long Island Sound covers only 3.5 square miles, but it still offers many attractions for retirees. Being a seaside village, Niantic has ample opportunities for water activities. The Niantic Bay Yacht Club hosts numerous sailboat races throughout the summer.
The coast of Connecticut is known to be a high-cost area. Niantic is no exception, but it's more affordable than other nearby places, such as better-known Mystic. For example, the median home value in Niantic is $283,000—pricey, but more affordable than the Mystic median of $404,900, according to the U.S. Census Bureau.
Share of population 65+: 9.1%
Cost of Living: 28.4% above the national average
Average Income for Households 65+: $62,651
Older folks don't seem too interested in facing the Last Frontier in retirement. Only 9.1% of the entire state's population is age 65 and up compared with 14.5% of the whole U.S. But if you crave adventure—and don't mind long winters and vast swaths of wilderness—it pays to live in Alaska. Literally. A state fund fueled by oil wealth gives all permanent residents an annual dividend. In 2017, the payment was $1,100 per person.
And residents could certainly use the extra cash. Living costs throughout Alaska are significantly higher than is typical across the continental U.S. But Anchorage is the least expensive metro area in the state. Plus, being the largest city in Alaska, it offers more amenities including numerous theaters, museums and shopping centers, on top of all the outdoor recreation you'd expect. It also has an abundance of health care facilities, more than 43 establishments per 1,000 seniors in the metro area compared with just 19 per 1,000 seniors in the U.S.
Population: 2.4 million
Share of population 65+: 13.2%
Cost of Living: 29.3% above the national average
Average Income for Households 65+: $53,063
Portland is such a great place to retire that it rises above the high cost of living and the Beaver State's unfriendly tax situation, levying one of the highest top state income tax rates in the U.S.. As an original participant in the World Health Organization's Global Age-Friendly Cities Project, Portland is committed to satisfying the needs of its older residents. In the early stages of its action plan, the Age-Friendly Portland Advisory Council—with members from AARP Oregon, nonprofit Elders in Action and Portland State University's Institute on Aging—has held discussions about intergenerational activities and programs, ways for businesses to engage with older adults and developing age-friendly housing.
And you can already enjoy the pedestrian-friendly neighborhoods, such as the popular Pearl District, as well as the public transit system, which costs only $1 a ride for those age 65 and older. For natural diversions, you don't have to go far. In the city, you can stroll Forest Park or hike extinct volcano Mount Tabor. Mount Hood and the ocean are also nearby.
Share of population 65+: n/a
Cost of Living: 36.5% above the national average*
Tiny Rhode Island packs in big living costs, and the village of Kingston is particularly pricey. But if you can afford it—the median household income for all ages is $76,250 a year—the location may well be worthwhile. Kingston offers easy access to some all-but-private beaches, and with its own Amtrak station the train ride to Boston and even New York is relatively quick. There’s also high-speed ferry service to Martha’s Vineyard.
And in town, the University of Rhode Island injects youth and vibrancy, and all the amenities that typically follow, into the community.
Share of population 65+: 15.5%
Cost of Living: 37.1% above the national average*
With more than 400 miles of shoreline, Annapolis offers water-loving retirees a torrent of activities. Kayaking, canoeing, boating and fishing are common enjoyments on the Chesapeake Bay. On land, the historical city is filled with 18th century buildings and is commonly referred to as "a museum without walls." And, as home to the U.S. Naval Academy, Annapolis draws a number of military retirees.
But you have to be able to afford it. Maryland is, by and large, a wealthy area, home to a great number of millionaires, and the living costs reflect that. The median home value in the Old Line State is $290,400, compared with just $184,700 for the U.S. In Annapolis, it's a whopping $377,200.
Share of population 65+: 17.6%
Cost of Living: 45.8% above the national average
Average Income for Households 65+: $57,916
State's Tax Rating for Retirees: Tax Friendly
Hawaii is well known for its beautiful beaches, enviable climate and high prices. If you're hoping to retire in paradise, you can do so more affordably on the Big Island compared with Oahu, home of capital city Honolulu, where retiree living costs are 88.0% above the U.S. average. The median home value in Hilo is $298,500—still pricey, to be sure, compared with the U.S. median of $184,700, but much more reasonable than the $602,700, median in Honolulu.
And the local lifestyle is still priceless. The colonial town's mood is quiet and calm, but its location on the eastern coast of the island and near active volcano Mauna Loa offers plenty of opportunities for adventure. You can explore rainforests and waterfalls, as well as Hawaii Volcanoes National Park. In the downtown and waterfront areas, enjoy galleries, shops, restaurants and museums, including the Imiloa Astronomy Center.
Population: 3.3 million
Share of population 65+: 12.7%
Cost of Living: 46.1% above the national average
Average Income for Households 65+: $62,681
Community Score: 64.3
Part of the San Diego metro area, Carlsbad (city population: 115,330) offers a small-city feel with easy access to big-city amenities. It has a vibrant cultural community, ocean-side living and sunny climate. Plus, there are 25 parks, nearly 50 miles of hiking trails and a full calendar of artsy offerings, including Foreign Film Friday and free summer concerts. And you can choose among a host of retirement communities with ocean views.
Of course, you have to be able to afford it. Like much of California, which sports the second-highest living costs in the country behind only Hawaii, the cost of living is steep. For example, the median home value in the U.S. is $184,700; in California, it's $409,300; and in Carlsbad, it's $674,400. The taxes also weigh heavily on your wallet.
Share of population 65+: 23.9%
Cost of Living: 62.2% above the national average*
Average Income for Households 65+: $51,534
The Garden State offers a number of appealing retirement destinations for those who can afford it. Ocean City is a particularly attractive spot, evidenced by the high share of seniors who have already chosen to reside there. Family-friendly beaches, a fun three-mile boardwalk and proximity to Atlantic City are notable draws.
But living there is going to cost you. Taxes are notoriously high all over Jersey, and housing is expensive. The median home value in city limits is a hefty $568,700, compared with $316,400 for the state and $184,700 for the U.S. Plus, you have to budget extra for insurance to protect against possible storm and flood damage. Note, too, that Ocean City is a dry town, but you don't have to travel far to buy your booze.
To pinpoint one great retirement destination in each state, we weighed a number of factors:
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