The state’s affordability was determined by analyzing property and sales tax rates from the Tax Foundation and cost of living data from the Council for Community and Economic Research. New York’s rise to the top spot may be due to rising housing costs in the city, where the majority of the population lives. On average, annual mortgage expenses are 34% lower outside New York. New York is also “moderately tax-friendly for retirees, with residents aged 59½ or older qualifying for a deduction of up to $20,000. California ranks as the second-most expensive state to retire for the second year in a row, with residents unable to deduct Social Security benefits but applying income taxes to withdrawals from other sources.
Here are the top 10 most expensive U.S. states to retire in 2023, according to Bankrate.
10 LEAST EXPENSIVE
- West Virginia
10 MOST EXPENSIVE
- New York
- New Jersey
Bankrate has identified the most affordable states for retirees in 2023. Housing costs are a crucial factor to consider, but healthcare costs are also a significant expense. As you age, you may become more reliant on healthcare services. Relocating to a city or town with lower healthcare costs after retirement can help save money. Other factors to consider include living close to family members and accessing desired activities. Retirement expert Kerry Hannon emphasizes the importance of financial and personal preparation to make smart decisions during retirement.