Retirement should be about relaxing and enjoying life—not worrying about every penny. In some states, your Social Security check goes a lot further, thanks to lower living costs and tax breaks. Want to make the most of your golden years? Here are the states where your money really stretches.
Indiana
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Indiana might not be the first place you think of for retirement, but it should be. The cost of living is about 8% below the national average, and the state doesn’t tax Social Security benefits. That means you get to keep more of your monthly check—and that’s a win.
West Virginia
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If peace, nature, and a low cost of living sound like your dream retirement, West Virginia delivers. Located in the Appalachians, it offers stunning scenery and prices that are 15.9% below the national average.
Arkansas
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In Arkansas, everything from groceries to healthcare costs less—about 14% less than the national average. On top of that, Social Security income isn't taxed, and retirees 59½ and older can deduct up to $6,000 from other retirement earnings. It’s an easy place to stretch your budget.
Alabama
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Thinking about sunshine and savings? Alabama offers both. The cost of living is 12% below average, and housing prices are nearly 37% cheaper. That makes it easier to find a comfortable home without draining your retirement fund.
Tennessee
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Tennessee is one of the few states that doesn’t tax Social Security or retirement income. That alone puts more cash in your pocket every month. If you're living on a fixed income, that kind of break can make a big difference.
South Carolina
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Looking for a slower pace and smaller bills? South Carolina fits the bill. The cost of living is 6% lower than average, and housing costs are about 23% cheaper. It’s a solid pick for affordable coastal living.
Iowa
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In Iowa, retirees get a double win: no state tax on Social Security and, as of 2023, no tax on other retirement income for folks 55 and older. That includes 401(k)s, IRAs, pensions—you name it. That’s more money left for you.
Michigan
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Michigan isn’t just about lakes and fall colors—it’s also a budget-friendly place to retire. The cost of living is about 10% lower than the national average, and housing is over 26% cheaper. If you’re looking to buy a home, your dollar goes further here.
Washington
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No state income tax? Yes, please. Washington doesn’t tax Social Security, pensions, or retirement withdrawals. That’s rare—and it means more of your money stays with you. If you can handle the higher cost of living, the tax savings are a huge perk.
Delaware
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Don’t let Delaware’s size fool you—it’s a retirement-friendly state. Social Security isn’t taxed, and if you’re over 60, you can exclude up to $12,500 of retirement income. Plus, you get the bonus of coastal charm and fresh seafood without the big-city prices.
New York
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Sure, New York has a high cost of living, especially in the city. But it’s not all bad news for retirees. Social Security benefits aren’t taxed, and you can deduct up to $20,000 from pensions or other retirement income. It’s all about choosing the right part of the state.
Arizona
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Arizona is known for its sunshine and desert landscapes, but it also gives retirees a break on taxes. The state doesn’t tax Social Security, helping you keep more of your check. Just be aware—other costs, like housing and healthcare, can vary by area.
North Carolina
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North Carolina offers a nice balance—mild weather, scenic spots, and a cost of living that’s just below the national average. Housing is about 7% cheaper, which means you don’t have to stretch your budget to find a cozy place to settle.
New Jersey
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It might surprise you, but New Jersey offers solid tax perks for retirees. Social Security isn’t taxed, and if you're 62 or older and your income is $150,000 or less, you can deduct up to $100,000 in retirement income. Not bad for a state with both beaches and big cities.
Connecticut
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Connecticut has a reputation for being pricey, but it’s friendlier to retirees than you might think. If you make under $75,000 a year (or $100,000 for couples), your Social Security isn’t taxed at all. Even if you earn more, a portion of your benefits remains untaxed.