January 27th 2025
By Jordan McElwain
Moderate climate, coastal charm, and relatively low cost of living make retiring in Delaware common. Learn about the pros and cons of Delaware retirement.
Delaware is rated as the fourth best state to retire to by Wallethub and was named Bankrate’s best state to retire in 2024. Compared to other states, Delaware ranks highly for affordability and offers plenty of lifestyle benefits for retirees.
If you’re thinking about retiring in “The First State,” read on to get all the details about the pros and cons, the best places to live, and more.
Like any destination, there are various pros and cons to retiring in Delaware. Here’s a closer look at what makes this state special—and where it might fall short.
Low property taxes: The average property tax rate across the state is 0.53%, the seventh lowest in the US.
Proximity to major cities: Bordered by Pennsylvania, New Jersey, and Maryland, Delaware puts you within easy reach of big cities like Philadelphia, Baltimore, and Washington DC. Even New York isn’t too far.
Coastal living: Located on the coast of the Atlantic Ocean, Delaware has plenty of charming beach towns such as Rehoboth Beach, Dewey Beach, and Bethany Beach. These areas offer a small-town feel and are more affordable than other coastal retirement destinations, such as Florida.
Tax-friendly policies: The state offers tax pension exclusions, does not tax Social Security benefits, and has no sales tax. (Find more on Delaware’s tax benefits below.)
Limited public transportation: DART First State offers public transit in Delaware, but its services are mostly concentrated in urban centers, leaving suburban and rural areas with limited public transportation options. You'll likely need access to a car if you live in the suburbs.
Cost of healthcare: Delaware ranks 10th in the US states with the most expensive healthcare costs. For retirees who rely on Medicare, healthcare costs in Delaware are often slightly higher than those in states with more competitive markets.
Cold winters: Delaware can get cold in winter. The winter season stretches from around December to mid-March, with January being the coldest month averaging 27°F.
Like all states, Delaware has good and bad areas. It’s ranked as the 20th safest state in terms of property and violent crime. Larger cities, especially during tourist season in the summer, can experience increased crime. However, many areas in Delaware are very safe, especially smaller towns and coastal communities.
Delaware has four distinct seasons, with warm summers and cold winters. There are plenty of opportunities for outdoor recreation throughout the year. In warmer months, retirees can enjoy kayaking, boating, golf courses, hiking, and birdwatching. During colder months, people can enjoy ice skating, hikes, and festivals.
Delaware is a small state, but it has 17 state parks. A few of the most popular state parks that showcase Delaware’s natural beauty include Cape Henlopen, Seashore, Holts Landing, and Auburn Valley.
Compared to nearby states like New Jersey and Pennsylvania, Delaware offers more affordability. However, the cost of living varies based on which city you live in. While coastal towns tend to be more expensive, suburban areas offer more affordable options for retirees.
If you’re an aspiring Delaware homeowner, there’s good news. Delaware offers more affordable housing than many other states. According to Zillow, a typical home costs $384,079—lower than the national average of $420,400. The state also has fairly low property taxes.
Delaware is a reasonably tax-friendly state for retirees, offering several key advantages:
No tax on Social Security: Your Social Security benefits or Railroad Retirement benefits are completely tax-free at the state level.
Pension exclusion: If you’re over 60, you can exclude up to $12,500 of retirement income from state taxes, including pensions, IRAs, and 401(k) distributions.
No sales tax: Delaware is one of the few states that doesn’t have any state or local sales tax.
While Delaware ranks highly for hospital quality, its reputation for older adults’ healthcare is not as impressive. Healthcare costs in the state are higher than average, and the healthcare system is under strain due to the rapidly aging population. Retirees should be aware of higher costs, particularly for those who need specialized care.
Choosing your Medicare coverage is an important step in retiring in the US. Understanding any key differences for Medicare in Delaware is important when considering it as your retirement destination.
There are 223,000 Medicare beneficiaries in Delaware, making up 22% of Delaware’s total population. 34% of Delaware’s Medicare beneficiaries are enrolled in one of 22 Delaware Medicare Advantage plans.
Choosing between Original Medicare and Medicare Advantage—and then comparing every option to determine which best fits your needs—can take days! Save time and stress by talking to a Chapter Medicare Advisor. Chapter’s Medicare Advisors put you first. They provide unbiased guidance for better clarity and cost savings, earning Chapter an A+ rating from the Better Business Bureau and thousands of 5-star ratings from happy customers. Get Medicare checked off your list by scheduling a free consultation or calling us at (888) 604-0055.
There’s no end to Delaware’s natural beauty, vibrant coastal towns, and outdoor recreation options. Its growing population of older adults has led to an increase in retirement communities too.
Here are some of the most popular cities for retirees across the state:
Wilmington: Wilmington is the most populous city in Delaware. As an urban city located on the bank of the Delaware River, it combines the feel of a small town with the conveniences of city living, offering plenty of restaurants, coffee shops, and cultural attractions. Wilmington has a popular train station and is also close to Philadelphia, making it a great choice for retirees who enjoy big-city visits.
Hockessin: Located 20 minutes inland from Wilmington, Hockessin offers a suburban lifestyle with lower-than-average crime rates. It also has plenty of outdoor recreation opportunities, making it ideal for retirees who enjoy nature and prefer a quieter setting than the city.
Dover: The state capital, Dover, is more affordable than other cities in Delaware, with a cost of living 7% below the national average. It is rich in history, with colonial architecture and a more relaxed atmosphere. Though it’s a bit farther from the coast and major cities, Dover offers good value for those seeking a more laid-back lifestyle.
Coastal towns: Delaware's beach communities each have their own unique charm. Rehoboth Beach is known for its vibrant boardwalk and social scene. Dewey Beach is popular with younger crowds and has a lively nightlife. And Lewes, located on the Delaware Bay, is perfect for retirees seeking peaceful beach living without the crowds.
Milton: Milton is a charming town 20 minutes inland from Lewes. Known for its Victorian architecture and small-town vibe, Milton offers a lower cost of living than towns that are directly on the coast.
Milford: Milford is a suburban city with easy access to both the coast and major cities. It’s known to be a safe area with good infrastructure and lots of outdoor activities.
Delaware offers a variety of resources for older adults, including services from Delaware Health and Social Services (DHSS) and Delaware Aging and Disability Resource Center (ADRC). These organizations provide assistance, referrals, transportation assistance, home health care, and more. There are also various non-profits and senior centers that offer recreational activities, socialization opportunities, and educational programs.
There’s a reason Delaware ranks so highly on many peoples’ lists of retirement destinations. The state combines practical benefits—like tax breaks and affordable housing—with four distinct seasons, charming coastal vibes, and abundant outdoor activities.
