Best States to Retire in 2025: Top 15 Ranked by Cost & Quality of Life
Choosing where to spend your retirement years is one of the biggest decisions you'll make. The best states to retire offer an ideal combination of affordable living, quality healthcare, favorable tax policies, and lifestyle amenities that match your priorities.
We've analyzed the top retirement-friendly states based on cost of living, healthcare quality, tax policies, and quality of life factors to help you find your perfect retirement home.
Key takeaways
No tax states for retirees, like Florida, Nevada, and Texas, offer significant savings on retirement income, while other states provide substantial tax breaks.
The cheapest states to retire often combine low housing costs with favorable tax policies, making your retirement dollars stretch further.
Quality healthcare access, climate preferences, and proximity to family should weigh equally with financial considerations when choosing retirement destinations.
What makes a state ideal for retirement?
Several key factors determine whether a state ranks among the best places to retire, and understanding these elements helps you make an informed decision.
Cost of living considerations
Housing costs typically represent the largest expense in retirement, making affordability a crucial factor. States with low cost of living for seniors often feature reasonable home prices, affordable property taxes, and lower daily expenses for groceries, utilities, and services.
Tax-friendly policies
Tax policies significantly impact retirement income, with some states offering complete exemptions on retirement income while others tax pensions, 401(k) withdrawals, and Social Security benefits.
Property tax rates also vary dramatically between states, affecting long-term housing affordability.
Healthcare quality and access
Access to quality medical care becomes increasingly important with age.
The best retirement states feature excellent hospitals, specialists, and healthcare networks, plus reasonable Medicare Advantage plan options and healthcare costs.
Climate and lifestyle factors
Weather preferences vary widely among retirees, with some seeking year-round warmth while others prefer four distinct seasons. Additionally, recreational opportunities, cultural attractions, and social communities contribute to overall quality of life.
Top 15 best states to retire in 2025
Based on a comprehensive analysis of taxes, costs, healthcare, and quality of life, these states offer the best combination of benefits for retirees.
1. Florida
Retiring in Florida remains a top choice with no state income tax, nearly year-round warm weather, and over a thousand senior living communities (including prominent options like The Villages). However, take note that the cost of living has increased in the last few years.
Why it's great: No income tax on retirement income, abundant healthcare facilities, and endless recreational activities.
2. Texas
Texas retirement has attracted double the number of retirees in cities like Austin over the past decade. Like Florida, it has warm weather for most of the year and no state income tax.
Why it's great: No state income tax, lower-than-average housing costs, and hundreds of retirement communities.
3. Nevada
Retiring in Nevada offers tax advantages and diverse landscapes from Las Vegas to Lake Tahoe.
Why it's great: No state income tax, generally sunny climate, plenty of recreational activities, and low property taxes.
4. Delaware
Delaware retirement earned recognition as Bankrate's best state to retire in 2024.
Why it's great: No sales tax, excellent low property tax rates, and no tax on Social Security benefits.
5. South Carolina
Retiring in South Carolina provides an affordable alternative to Florida and North Carolina.
Why it's great: $15,000 retirement income deduction for those 65+, no Social Security tax, and the cost of living is 11% below the national average.
6. Arizona
Arizona retirement attracts retirees with its dry, sunny climate and 151 retirement communities.
Why it's great: Social Security income is not taxed, year-round outdoor activities, a dry climate for those who don’t do well with humidity, and established retirement communities.
7. Georgia
Retiring in Georgia offers warm weather without having the same extreme heat and humidity that most of Florida has.
Why it's great: Up to $65,000 retirement income deduction for those 65+, mild winters, and 676 retirement communities.
8. Virginia
Virginia retirement ranked third nationally by WalletHub for retirement destinations.
Why it's great: No tax on Social Security, a moderate four-season climate, and over 500 retirement communities statewide.
9. Ohio
Retiring in Ohio attracts retirees with low living costs and taxes, even though it’s known for its colder winters.
Why it's great: Social Security is not taxed, retirement income credits are available, and over 200 retirement communities.
10. New Jersey
New Jersey retirement offers proximity to major cities and coastal living.
Why it's great: No tax on Social Security, proximity to major East Coast cities, access to nice beaches, and mild coastal climate.
11. California
California retirement appeals to those prioritizing climate and amenities over cost. While this is one of the higher cost-of-living states in the country, it can be worth it for those who value the mild climate and lifestyle.
Why it's great: Mild year-round climate, excellent healthcare facilities, outstanding senior living or retirement communities, and no tax on Social Security income.
12. North Carolina
North Carolina provides mountain and coastal options with a moderate climate and reasonable costs. Some areas, however, are becoming more heavily populated.
Why it's great: Partial retirement income exclusions, diverse landscapes from mountains to coast, access to beautiful beaches, and a moderate climate.
13. Tennessee
Tennessee's absence of income tax and low cost of living make it attractive for budget-conscious retirees.
Why it's great: No state income tax, low cost of living, warmer weather compared to some other states, plenty of outdoor activities, and rich cultural heritage.
14. Colorado
Colorado combines outdoor recreation availability with reasonable costs and tax benefits.
Why it's great: Moderate taxes on retirement income, diverse climate options, exceptional outdoor recreation, and healthy lifestyle opportunities that can help keep you active.
15. Michigan
Michigan provides affordable living with Great Lakes recreation and established senior communities. It’s also a relatively lower-cost-of-living state compared to many others.
Why it's great: Partial retirement income deductions, Great Lakes recreation, and affordable housing markets.
Comparing retirement costs across top states
Understanding the financial implications of different states helps you budget effectively for retirement.
Housing and property taxes
Housing costs vary dramatically between states, with median home prices ranging from under $200,000 in some areas to over $500,000 or more in popular destinations. Property tax rates also differ significantly, with states like Delaware and South Carolina offering much lower rates than other states.
Healthcare costs
Healthcare expenses represent a major retirement cost, with significant variation between states. States with competitive healthcare markets and strong Medicare Advantage networks often provide better value for retirees. Make sure to also consider healthcare availability.
Daily living expenses
Groceries, utilities, transportation, and other daily expenses vary by region. States with lower overall cost of living help retirement income stretch further, particularly important for those on fixed incomes.
How to choose your ideal retirement state
Consider your financial situation, including retirement income sources and savings. States with favorable tax policies can significantly impact your purchasing power, while affordable housing markets or lower cost of living areas help preserve retirement savings.
Evaluate healthcare needs and preferences for medical care access. Research Medicare Advantage plan availability and quality ratings in potential retirement locations.
Think about lifestyle preferences, including climate, recreational activities, and proximity to family. Visit potential destinations during different seasons to experience year-round conditions.
Bottom line
The best states to retire in 2025 offer different advantages depending on your priorities.
Florida, Texas, and Nevada lead in tax benefits and warm weather.
Delaware and South Carolina provide coastal charm with financial advantages.
Colorado and Virginia offer four-season climates with outdoor recreation.
Ohio and Michigan provide affordable living with established communities.
Consider your personal priorities around climate, tax implications, healthcare needs, and lifestyle preferences when making your decision. The ideal retirement state balances financial benefits with quality of life factors that matter most to you.
Visit potential destinations during different seasons and research local communities, healthcare facilities, and senior services before making your final choice. The right retirement destination should enhance your golden years while preserving your financial security.
Planning your retirement? Check out our tips on having happy retirement years.
FAQs
What is the #1 best state to retire in 2025?
Florida consistently ranks #1 for retirement due to no state income tax, year-round warm weather, abundant senior communities, and excellent healthcare facilities, though its cost of living has increased over the last few years. However, the best choice depends on individual preferences for climate, costs, and lifestyle.
Which states don't tax retirement income?
Nine states have no state income tax: Florida, Texas, Nevada, Alaska, South Dakota, Tennessee (eliminated income tax on interests/dividends in 2021), Wyoming, Washington, and New Hampshire.
Note that Washington doesn’t tax wages or salaries but does have a capital gains tax on high earners
What are the cheapest states to retire in?
The most affordable retirement destinations typically include Ohio, Georgia, South Carolina, Tennessee, and parts of Texas. These states combine low housing costs, reasonable property taxes, and favorable policies for retirees. While Florida used to be on this list, its cost of living has increased quickly over the last five years.
Sources
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U.S. Census Bureau. (2024). Annual estimates of the resident population by single year of age and sex. Retrieved from https://www.census.gov/programs-surveys/popest.html
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