February 6th 2025
By Jordan McElwain
Beautiful landscapes and a lively music scene make Tennessee a popular option. Learn about the pros and cons of Tennessee retirement.
Tennessee has one of the fastest-growing populations in the US. The state offers affordable living, diverse real estate options, natural beauty, a welcoming atmosphere, and a lively music scene. For retirees in particular, it also offers low taxes, an affordable cost of living, and plenty of natural beauty.
In this article, we will discuss the pros and cons of retiring in Tennessee, including a closer look at safety, climate, housing, taxes, healthcare, and a few of the best places to live in the state.
Like any state, retiring in Tennessee has its advantages and drawbacks. It's important to weigh both before making the move.
No state income tax: Tennessee doesn’t have a state income tax. This means that all forms of retirement income are untaxed at the state level, including Social Security, pensions, and withdrawals from retirement accounts.
Low property taxes: Tennessee’s average property tax rate is just 0.58%, which is much lower than the national average. Homeowners typically pay around $1,356 annually in property taxes (half the national average). Plus, older adults may qualify for tax relief programs to reduce costs further.
Affordable cost of living: Taking housing, utilities, and general day-to-day expenses into account, the cost of living in Tennessee is approximately 10% lower than the national average. While popular TN cities, like Nashville, have higher costs of living, most retirees can find a comfortable and affordable city to stretch their retirement savings.
Natural beauty: From the majestic Smoky Mountains to beautiful rivers and rolling hills, Tennessee offers many opportunities for outdoor recreation. Whether you enjoy hiking, fishing, boating, or just relaxing in nature, Tennessee’s diverse landscapes will appeal to outdoor enthusiasts.
High sales tax: Because Tennessee has no income tax and a low property tax, the state relies more on its sales taxes to balance budgets. Tennessee’s base state sales tax is 7% but local taxes may result in a total sales tax of up to 9.75% in some areas.
Natural disasters: South Carolina is vulnerable to tropical storms, hurricanes, and flooding. These storms can have devastating effects, especially in coastal areas. South Carolina is also ranked #8 for tornadoes per square mile.
Limited public transportation: Outside of major cities, there is not a robust public transportation system. If you don’t drive, you may need to depend on friends, family, or taxis to get around.
While Tennessee has slightly higher-than-average property and violent crime rates compared to the national average, there are many safe communities to consider, including Signal Mountain, Oakland, and Loudon. A few of the worst-ranking cities for safety include: Memphis, Ripley, Bolivar, Brownsville, and Fayetteville.
Tennessee’s rich natural landscape along the Appalachians, includes many national and state parks, rivers, lakes, and more, offering endless recreational opportunities for those who love the outdoors.
Tennessee has a temperate climate with four distinct seasons, but the weather can vary significantly depending on the region. Below, we dive into the detailed climates of three key regions in TN.
East Tennessee has a mild, and generally cooler, climate compared to the central and western parts of the state. Eastern Tennessee is home to the Great Smoky Mountains National Park, and is a great place for outdoor recreation, including hiking, camping, and fishing.
Middle Tennessee, where you’ll find cities like Nashville and Franklin, has a moderate climate with hot, humid summers, and mild winters. Nashville, possibly the most well-known city in Tennessee, is best known for country music and hot chicken. You’ll find numerous outdoor music festivals throughout the year as well as waterfalls, parks, and biking trails in central Tennessee.
Summers in this area can be especially hot and humid. Along the edge of west Tennessee, you’ll be greeted by the Mississippi River. The most well-known city in West TN is Memphis, which is home to Elvis Presley’s Graceland, Sun Studio, and the National Civil Rights Museum. West Tennessee also offers many outdoor activities, including kayaking, and birdwatching.
A major reason why people retire in Tennessee is because of affordable housing and an overall low cost of living.
In many parts of Tennessee (excluding big cities like Nashville and upscale areas like Germantown), home prices are approximately 18% lower than the national average. Rental properties are abundant and affordable compared to other parts of the US. Renters can find spacious apartments, townhouses, and single-family homes. However, the cost of senior living facilities in Tennessee is above the national average.
Utilities and groceries are also more affordable than in other states, but a high sales tax can add to the overall cost of living, particularly in areas where local taxes result in a 9.75% sales tax rate.
Tennessee is a tax-friendly state that offers notable tax benefits for retirees.To start, your retirement income will not be taxed. This goes for your income from social security, pensions, or retirement account withdrawals.
Property taxes are relatively low, and your tax burden could be even lower if you qualify for property tax relief programs. One of these programs is the "Tax Freeze" program, which ensures that property taxes for low-income retirees do not increase.
Tennessee has various high-quality healthcare facilities in its larger cities, including Vanderbilt University Medical Center, UT Medical Center, and Memorial Health System. However, rural areas often face shortages of healthcare providers and facilities.
Medicare is an important part of American retirement, and coverage options vary between states (even counties). When you enroll in Medicare, you choose between Original Medicare and Medicare Advantage. People on Medicare have an average of 39 Tennessee Medicare Advantage plans to choose from, depending on the county they live in. Not sure if you should choose Original Medicare or Medicare Advantage? Read our overview of Medicare in Tennessee and give us a call at 855-900-2427 to get your Medicare questions answered.
Tennessee offers a variety of wonderful cities and towns for retirees. Some of the best places to retire in the state include:
Germantown: A suburban community near Memphis, Germantown has excellent amenities and a strong sense of community. It offers easy access to Memphis but maintains a quieter, more peaceful atmosphere.
Chattanooga: Situated along the Tennessee River and near the Smoky Mountains, Chattanooga offers affordable housing, beautiful scenery, and plenty of outdoor recreation. Choose your neighborhood carefully, as in any city, some areas have higher crime rates than others.
Memphis: Memphis offers a wide array of amenities, but has a high-than-average crime rate. It’s located on the Mississippi River in southwest Tennessee and is famed for being the birthplace of rock n’ roll, blues, and other legendary music. Despite being a big city it has a relatively low cost of living.
Knoxville: Knoxville is a charming, affordable city that combines urban conveniences with outdoor adventure. With its proximity to the Great Smoky Mountains, Knoxville offers a variety of recreational opportunities, but its crime rate is slightly higher than the national average.
Franklin: If you want big-city accessibility without the traffic, noise, and prices, Franklin is a great option. It has a charming and walkable downtown area, low crime rates, and scenic beauty. If you’re a live music fan, you’ll also appreciate its proximity to the Grand Ole Opry.
Johnson City: This medium-sized city in eastern Tennessee, bordering North Carolina, is known for its beautiful parks, low cost of living, and outdoor recreation options. It also has a warm, friendly, welcoming community.
Tennessee offers a variety of resources for retirees enjoying their golden years. A few to look into include:
Tennessee Association of Area Agencies on Aging and Disability (TAAAAD): This nonprofit organization provides valuable information about aging services, healthcare, and financial assistance.
Tennessee State Health Insurance Assistance Program (TN SHIP): This program is designed for Medicare beneficiaries. It helps adults navigate Medicare options, understand benefits, and make informed healthcare decisions.
Aging Nutrition Program: This program provides meals, nutrition education, and socialization opportunities for adults over 60, helping retirees stay healthy and connected.
MyRide Tennessee: This volunteer transportation service connects volunteers with older adults to help them reach a variety of destinations including medical appointments and grocery stores.
Tennessee has a lot to offer for all residents, including its retirees. It’s a relatively affordable state to live in and does not tax retirement income. It also has a wide range of outdoor and cultural activities. For example, if you live near Nashville, you can enjoy summer concerts at Centennial Park for free—just grab a picnic basket and a blanket and you have yourself a wonderful evening!
As with any state, consider what you want in retirement and consider a short-term lease to decide if you should retire in Tennessee.
