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2018’s Best & Worst States to Retire

Retirement might be the end of your career, but it doesn’t have to be the end of financial security or life satisfaction. Timing is often a primary concern with retirement, as it generally coincides with the age at which we may receive Social Security or pension benefits. Not everyone can retire when they want to, though. Almost 30 percent of non-retired adults haven’t saved any money for retirement, though not necessarily through any fault of their own.


But in addition to when you want to retire, a good question to ask is where. That can be difficult to decide without doing lots of research. Even in the most affordable areas of the U.S., most retirees cannot rely on Social Security or pension checks alone to cover all of their living expenses. Social Security benefits increase with local inflation, but they replace only about 40 percent of the average worker’s earnings.


If retirement is still a big question mark for you because of finances, consider relocating to a state that lets you keep more money in your pocket without requiring a drastic lifestyle change. To help you find that permanent, affordable place to call home, WalletHub compared the 50 states across 41 key indicators of retirement-friendliness. Our analysis examines affordability, health-related factors and overall quality of life. Read on for our findings, insight from a panel of experts and a full description of our methodology.


Best States to Retire


Ask the Experts

In order to choose a place to settle for retirement, you must carefully consider various factors such as your finances, health and how you plan to spend your time. For advice on these choices, we turned to a panel of experts in fields such as aging and taxes. Click on the experts’ profiles to read their bios and responses to the following key questions:

  1. What is the most common mistake that retirees make when choosing where to live?

  2. What are some tips for living on a fixed income in retirement?

  3. What are the top factors retirees should consider when choosing a state for retirement?

  4. Should states work to attract retirees? What are the pros and cons to having a large retiree population?

  5. Should retirees be exempt from certain state and local taxes?

  6. How might changes to the tax code influence retirement security?

Methodology

In order to identify the most retirement-friendly states, WalletHub compared the 50 states across three key dimensions: 1) Affordability, 2) Quality of Life and 3) Health Care.

We evaluated those dimensions using 41 relevant metrics, which are listed below with their corresponding weights. Each metric was graded on a 100-point scale, with a score of 100 representing the most favorable conditions for retirement. For metrics marked with an asterisk (*), we used the square root of the population to calculate the population size in order to avoid overcompensating for minor differences across states.

We then calculated each state’s weighted average across all metrics to determine its overall score and used the resulting scores to rank-order our sample.


Affordability - Total Points 40

  • Adjusted Cost of Living: Double Weight (~11.43 Points)

  • General Tax-Friendliness: Full Weight (~5.71 Points) Note: This metric is based on WalletHub’s States with the Highest & Lowest Tax Rates ranking.

  • Tax-Friendliness on Pensions & Social Security Income: Full Weight (~5.71 Points)

  • Tax-Friendliness on Estate or Inheritance Tax: Full Weight (~5.71 Points)

  • Annual Cost of In-Home Services: Half Weight (~2.86 Points)

  • Annual Cost of Adult Day Health Care: Half Weight (~2.86 Points)

  • Share of Adults Aged 65 and Older Who Could Not Afford a Doctor Visit: Full Weight (~5.71 Points) Note: This metric measures the share of the population aged 65 and older who needed to see a doctor in the past 12 months but were restricted due to cost.

Quality of Life - Total Points 30

  • Share of Population Aged 65 & Older: Full Weight (~1.67 Points)

  • Elderly-Friendly Labor Market: Full Weight (~1.67 Points) Note: This metric takes into account both the percentage of people aged 65 and older working and the number of part time employees for every full time employee for people aged 65 and older.

  • Share of Population Aged 65 & Older Below Poverty Level: Full Weight (~1.67 Points)

  • Elderly Food Insecurity Rate: Full Weight (~1.67 Points) Note: This metric refers to the percentage of adults aged 60 years and older who faced the threat of hunger in the past 12 months.

  • Access to Public Transportation: Full Weight (~1.67 Points) Note: This metric measures the percentage of commuters who use public transit as a proxy for the availability of public transportation.

  • Mildness of Weather: Double Weight (~3.33 Points) Note: This metric is based on WalletHub’s Cities with the Best & Worst Weather ranking.

  • Access to Scenic Byways: Full Weight (~1.67 Points) Note: This metric takes into account both the number of scenic byways and the length of scenic byways.

  • Shoreline Mileage: Full Weight (~1.67 Points)

  • Museums per Capita*: Full Weight (~1.67 Points)

  • Theaters per Capita*: Full Weight (~1.67 Points)

  • Golf Courses per Capita*: Full Weight (~1.67 Points)

  • Access to Adult Volunteer Activities: Full Weight (~1.67 Points)

  • Elderly Volunteer Rate: Full Weight (~1.67 Points)

  • Violent-Crime Rate: Full Weight (~1.67 Points)

  • Property-Crime Rate: Full Weight (~1.67 Points)

  • Quality of Elder-Abuse Protections: Full Weight (~1.67 Points) Note: This metric is based on WalletHub’s States with the Best Elder-Abuse Protectionsranking.

  • Air Quality: Half Weight (~0.83 Points)

  • Drinking-Water Quality: Half Weight (~0.83 Points) Note: This metric measures the percentage of the population potentially exposed to water exceeding a violation limit.

Quality of Life - Total Points 30

  • Family & General Physicians per Capita: Full Weight (~1.76 Points)

  • Dentists per Capita: Full Weight (~1.76 Points)

  • Nurses per Capita: Full Weight (~1.76 Points)

  • Share of Geriatricians Required to Meet Estimated Need (Geriatrician Shortfall): Full Weight (~1.76 Points)

  • Top-Rated Geriatrics Hospitals: Full Weight (~1.76 Points)

  • Health-Care Facilities per Capita: Full Weight (~1.76 Points)

  • Quality of Public Hospitals: Full Weight (~1.76 Points) Note: This metric is based on Centers for Medicare & Medicaid Services’ ranking of public hospitals.

  • Well-Being Index for Americans Aged 55 and Older: Full Weight (~1.76 Points)

  • Share of Adults Aged 65 & Older with Good or Better Health: Full Weight (~1.76 Points)

  • Share of Adults Aged 65 Years and Older with Poor Mental Health: Full Weight (~1.76 Points) Note: This metric refers to the share of adults 65 and older who reported their mental health was not good 14 or more days in the past 30 days.

  • Share of Adults Aged 65 & Older with a Disability: Full Weight (~1.76 Points)

  • Share of Adults Aged 65 & Older Who Are Physically Active: Full Weight (~1.76 Points)

  • Share of Adults Aged 65 and Older Who Are Obese: Full Weight (~1.76 Points)

  • Share of Adults 65 Years and Older with Inadequate Sleep: Full Weight (~1.76 Points) Note: This metric refers to the share of adults 65 and older who reported sleeping less than seven hours in a 24 hour period on average.

  • Life Expectancy: Double Weight (~3.53 Points)

  • Death Rate for Adults Aged 65 & Older: Full Weight (~1.76 Points)

Sources: Data used to create this ranking were collected from the U.S. Census Bureau, Federal Bureau of Investigation, Council for Community and Economic Research, U.S. Bureau of Labor Statistics, Retirement Living Information Center, Genworth Financial, United Health Foundation, County Health Rankings, Centers for Disease Control and Prevention, Centers for Medicare & Medicaid Services, Charity Navigator, Gallup Healthways, GolfLink, The Tax Foundation, America's Scenic Byways, NOAA Office for Coastal Management, U.S. News & World Report, Institute for Health Metrics and Evaluation, and WalletHub research.


Disclaimer: Editorial and user-generated content is not provided or commissioned by financial institutions. Opinions expressed here are the author’s alone and have not been approved or otherwise endorsed by any financial institution, including those that are WalletHub advertising partners. Our content is intended for informational purposes only, and we encourage everyone to respect our content guidelines. Please keep in mind that it is not a financial institution’s responsibility to ensure all posts and questions are answered.


Originally Published, Jan 16, 2018  |  Richie Bernardo, Senior Writer www.wallethub.com

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