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What Is Your Worst State for Retirement?

Category: Best Retirement Towns and States

August 31, 2022 — There is one list that no state wants to be on – the one that names the worst states for retirement. A new list came out last week from bankrate.com, and it immediately got a lot of attention. While their list isn’t bad, it really misses the most important thing – lists like this don’t make sense because they don’t take into account that everyone’s retirement criteria are unique. Any attempt to generalize means coming up with the wrong answers for a lot of people. In this article, we will list the worst 5 states on the bankrate list, as well as the top 5 from Topretirements’ most recent Worst Places to Retire list. But more important than that, we will also outline what could be the worst states for retirement for people in very different situations (well off retirees vs. those on a tight budget, homeowners vs. renters, those with a focus on well-being or strong political opinions, as well as folks with climatic and recreational requirements).

The bankrate.com list’s worst states for retirement were compiled on the basis of affordability (which was weighted highest), well-being, climate, and cultural diversity. All but Maine were in the West. Their worst 5 were (the links go to our Mini-retirement Guides to these states):

Big Sky Country

Montana

New Mexico

California

Maine

Alaska

The states on the latest Topretirements.com worst 5 list were selected using slightly different criteria: predominantly taxes and cost of living. All were located in the Northeast.

New Jersey

New York

Connecticut

Rhode Island

Massachusetts

Almost no overlap among the 20 worst!

As you can see, there is no overlap among the top 5 on both lists. If we also include both lists’ #6-10, only 3 of the 20 overlap: California, Connecticut and Vermont. In our opinion, that shows how subjective and generalized these kind of lists are. Some of those states might indeed be the worst place to retire for many folks, but they might also be the perfect spot for others. The key is to know what is important for you.

Different strokesWhat makes your worst (and best) state for retirement?

People who are well off. People of means with plenty of retirement savings and/or a generous pension are in a lot better shape than just about everyone else when it comes to retirement. They can retire wherever they want. Cost of living isn’t that important, so they can pick any state that has the climate and the environment they want. That opens up California, Florida, and the New England states – all of which have many different attractions. But some people with a lot of money fret about taxes – they just don’t want to pay them! So even though they might be able to afford those taxes, a state on the worst states on the Topretirements list, which features high property and income taxes, might be a no go for them. To minimize taxes on big incomes, try a state with no income tax like Texas, Florida, Nevada, or Washington.

On a budget. Unfortunately there are far more people in this boat than any other. Cost of living should probably be the biggest driver here. The worst states on that basis are going to be Hawaii, California, New York, New Jersey, Connecticut, and Massachusetts. The best ones will predominantly be in the South: Mississippi, Tennessee, Missouri, and Kentucky, plus Michigan in the midwest. But that is not to say that you couldn’t make a higher cost state work. Every state has some locations that are not as expensive, or where you could get by on a tight budget if you were creative about your living situation.

Well-being. According to the well-being rankings used by bankrate, the worst states in the country are mostly in the south and what you might expect: Mississippi, Alabama, Kentucky, West Virginia, and Arkansas. They used an index of access to healthcare, food, physical health, and economic security to score this factor. Health care would fall into this area. Most people agree it is important to retire somewhere with good access to quality care. Looking for the best well-being – go to Hawaii, Maryland, and states in the Northeast.

Homeowners vs. Renters. People who own their own homes have advantages and disadvantages when it comes to retirement. If they own in a market where values have escalated (even exploded since the pandemic), they could be in the catbird seat. If they choose to, they could sell their home in a “worst” state with a high cost of living, make a huge profit, move to a lower cost, “best” market in the south or midwest, and still have a pile of cash to spend in their retirement. When it comes to disadvantages though, those high valuations are going to mean high property taxes. Certainly both situations would apply to folks in high cost states like California, Washington, New York, and Connecticut.

Retirees who rent don’t have the opportunity to cash in their equity, but it is very easy for them to escape high cost markets in big cities or in the Northeast. Rents are increasing rapidly right now because of higher interest rates and strong demand from people who cannot afford to buy, so renters would be better off avoiding states with high cost of living and looking for opportunities in lower cost states.

Climate and recreation. In this category the worst states for retirement are the ones that don’t offer the climate and recreation you are looking for. If you want access to a beach, best to avoid the midwest. But every state has lakes, if that is your lifestyle desire. There are no mountains in Florida or Nebraska. Many, many people have had it with snow and ice – driving in it, shoveling it, falling on it – so states with the high snowfalls in the East, Midwest, and Rockies would be their worst places. To us, climate and recreation is the most important category, because retirement is supposed to fun and easy.

Family. Many retirees choose to live near their families, so living far away from them would make where they live their worst state for retirement. As someone who lives in the East and has his only grandchildren in California, I see the advantages of being close! My friends with nearby grandchildren get to see them much more often and participate in their lives. On the other hand, children move, and that means you might have to as well. And occasionally, relatives can be too close.

Strong political beliefs

Sadly, this didn’t use to be an issue for where people live in retirement, but now it is. If you are conservative and don’t want to be around people on the other side of the political divide, much of coastal America could be a tough place for you. Likewise for very progressive folks; Idaho, Montana, Wyoming, and most of the South would be very hard states to live in. That being said, the rule of over-generalizing applies. College towns and big cities in even the reddest of states are almost always very liberal. Rural areas in blue states tend to be conservative, and there are always plenty of Republicans in any state. So retire to where you want to live, just know what you might be getting into. (Editorial rant: Oh, that we could return to the days when both political parties didn’t call each other names and believe the other one is a threat to democracy! Both extremes might be right, but more likely both extremes are wrong. So maybe we should all do our part and quit demonizing the other side, and take a big step toward the middle, where the answers to our problems lie).


Bottom line

We hope that by now we have proved our point – that the worst states for retirement are only the ones that apply to your situation. No canned list makes any sense if it is does not feature the criteria that are important to you. Figure those out, and you will have narrowed down your options. Please share your opinions about your worst states for retirement in the Comments section below.

For further reading:


Posted by Admin on August 31st, 2022

14 Comments »

  1. These lists can be deceiving. When you consider property taxes, Texas costs more than California. Haha, y’all keep moving here thinking it is cheaper. Living in sweaty armpit weather with high costs along with women being second class citizens has gotten old. Ill be going back to CA as soon as I can!

    by Julia — September 1, 2022

  2. First of all, THANK YOU so much for your comment about trying to get along with others whose political views are different than ours! Now to the subject matter …. years ago my husband & I used to dream of moving from New England to one of the Carolinas to avoid the harsh winters. At that time climate was a priority. Then our son got married & now has two beautiful daughters! So of course our priority shifted to being close to family, especially grandchildren. A couple of years ago we sold our home to move closer to our son & family into a nice 55+ condo community. However, now our “kids” are planning to move out-of-state in order to cut down on commuting time to work. So I can relate to your comment that while you may move to live near family, they often decide to move, too! We are planning to move again – one last time. If our “kids” move again in the future, then we will stay put!

    by Night Owl — September 1, 2022

  3. You are so right on your editor’s comment about political beliefs and ‘moving to the middle.’ So much more unites us in America than divides us, at core, and you hear that as you travel the country and try hard to talk with people, real people, ‘on the street’ . . . (still trying to figure out how we coalesce towards the middle while rapidly growing ‘splintered media’ divides our inputs into factions and increasingly bends ‘truth’ apart!)

    by Gene Owen — September 1, 2022

  4. Thoughtful analysis and agree, your comment on politics and getting along with our fellow Americans is right on! We are suffering the loss of friends and family whose politics lead them to abandon half century relationships.

    by kw — September 1, 2022

  5. I’m in agreement to all the previous comments. I would just add that it is helpful to know how a state uses it’s funds to support seniors. Is there quality access to doctors, medical procedures and elder care facilities if needed?

    by JoannL — September 2, 2022

  6. Living near family is my husband’s and my primary consideration. Our children have bought homes nearby, their spouses have local roots, and they’re all likely to remain in Southern California. In the unlikely situation that all moved away, we’d follow one and visit the others as often as possible.

    My family has strong political leanings, which is also true of those who’ve married in. All of us would find it untenable to live in a state or area where the politics and laws were dramatically different from our beliefs.

    I agree it’s a terrible shame that our country has become so divided, but, and I hate to say this, the writing on the wall suggests things are going to get a whole lot worse before they get better.

    by JCarol — September 2, 2022

  7. Some of us will choose to retire where we belong – back in New Jersey, where I spent my youth or New England, where I spent my teens. Therefore, it’s still helpful to have information on best choices of where to go so that the higher cost of living and taxes are less burdensome. I love all the seasons, not just the summer, and can’t wait to get back!

    by Ellen Lawrence — September 2, 2022

  8. It’s not so much that I don’t want to be around people on the other side of the political divide – I’m surrounded by them in the community where I live and we get along fine without discussing politics. Like JCarol, I have strong political leanings, and my main reason for wanting to live in a state – not just a community – with similar leanings is that I want to see my tax dollars used to support the values I believe in. I want to see the local school board support those values. I want to see my city council and my local police department support those values. Once the housing market settles down, once Covid is sufficiently under control so that I’m comfortable hopping on a plane, I’ll be moving to a community in this same state where the values of local government align more closely with my values, where the county board of supervisors hasn’t been bought and paid for by the wealthiest in the county, and where there is more concern for solving the problems of the day, whether it is homelessness, food insecurity, stray animals, or something else. So many states would be “the worst” for me because of the values mismatch. I grew up in this state, my values were shaped here, and it really is the perfect one for me.

    by JoannC — September 2, 2022

  9. When we moved from Massachusetts to Arizona I never imagined just how out of place I would feel. The politics here in AZ are a nightmare for me coming from a blue state. Also, Covid has made it very hard to get back to see my family as it is so far away. Needless to say we are moving back to Massachusetts as soon as we find an affordable home there. A story for another day. Lesson learned. We never should have moved away.

    by Roberta — September 3, 2022

  10. The whole “cost of living” index can be deceiving. You probably need to make that judgement for yourself. We went south for work in 2007 and tried to make the best of it. But, once retirement loomed we knew we’d head back to New England – especially for cooler weather, so we had to make it work.

    We made a list of our current expenses and estimated income that would cover them. Then we made a “fact finding” trip to check out the local costs. Armed with our list, we were surprised. Compared to TN, a no-income-tax state, Maine had a lot of things that were lower costs. We had enough equity in our home to make a good down payment, thus keeping our mortgage payment equal or less than we had. Food was less and the quality of fresh was superior. Gas was a little higher but now we only have one car. Car & home insurance was half of what we paid. Plus, there are more things that we need or want to do here in Maine that were not there for us in TN. Medical care has been top notch!

    Make your own list, compare to your current expenses. Can your retirement income cover it? We’ve been lucky enough, so far (5 years) to live comfortably, so far, without touching our savings/ira/401K. We’ll dip into them as we go but the move here has given us our best life! Find yours!

    by HEF — September 3, 2022

  11. Read the above comments. They all make sense to me. Being Canadian, my Canada, thoughts do run from Coast to Coast. Each has its own Politics. However, do think I move back to Ontario as my Family is V.I.P. & do miss my time with them!!

    by BillyBogey — September 3, 2022

  12. My husband and I retired in 2018 and moved from Illinois (not Chicago) to Arizona, to a small city SE of Tucson. We regret nothing. Fabulous weather, property taxes are about 25% of what we paid in Illinois. We have about 3.5 seasons – including fall with changing leaves and one or two days each winter where it snows (and melts before noon). We bought a home in a 55+ community and found it easy to make friends. The political climate is indeed different down here, but we have a small, solid group of close friends whose political leanings align with ours, and a wider circle of friends who support the other side…and we find we can have civil, adult discussions about differences. If only the whole country could do so. Family is all back in IL, but we’ve been back 3 times in the 4 years we’ve lived here (skipped Covid year) and we’ve had family happy to escape Midwest winters and come visit. We did a lot of research before buying down here, and spent time both in winter AND summer before taking the plunge. We are even aligning with Arizona sports teams! 🙂

    by State Hopper — September 3, 2022

  13. Perhaps the worst state is your state of mind. No locale is ideal if you obsess about it’s perceived negatives.

    by Robert — September 12, 2022

  14. Roberta,
    I commend you for admitting you are not happy with your move and are aiming to correct it. My brother and wife have a similar story but instead of working on plan to move back they constantly complain. I guess I’m not that adventurous to pick a spot and move away from where I have been a good part of my life and am happy. Although I would like to consider a second home somewhere someday.

    by Alex — September 13, 2022

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