Surprising fact: recent analysis ranks Tennessee and Kansas tied at the top for everyday affordability, while Mississippi posts some of the nation’s lowest care and home costs.
I dug into 2024–2025 data: C2ER price indexes, Zillow home values, and aggregated reports from Kiplinger, SmartAsset, and Ooma. I weigh groceries, utilities, transport, property values, tax rules, and care fees to build a clear picture.
Why this matters: a low sticker price can change your retirement plan. Mississippi’s assisted living and home-care rates are unusually low, and Florida’s tax rules can stretch social security and pension checks.
My goal is simple: combine current numbers so you can make smarter decisions about place, housing, and long-term costs across the country. I’ll show where daily expenses lead the rankings, where housing eases the budget, and which factors shift true affordability.
Key Takeaways
- Tennessee and Kansas lead on everyday expenses right now.
- Mississippi offers very low care and home prices that affect lifetime costs.
- Tax rules, like Florida’s exemptions, change take-home income.
- I use up-to-date 2024–2025 sources to inform actionable plans.
- Balance affordability with access to healthcare and services.
How I ranked affordability for retirees right now
I approached ranking with a reproducible method that blends price and quality signals. I used Motley Fool (2025) as a synthesis layer and anchored raw inputs to C2ER 2024, Zillow 2024, Tax Foundation, and the United Health Foundation senior report.
Key factors: everyday cost indexes, typical home values, effective tax rates, senior health scores, and long-term care estimates. C2ER 2024 shows Tennessee (92.8) and Kansas (92.9) near the bottom of the index range; Zillow 2024 lists West Virginia homes around $168,172 and Mississippi at $181,313.
I normalize numbers so states compare on the same scale: ZHVI typical values, assisted living annual ranges (~$54,943 to ~$139,807), and home care hourly rates ($24–$43).
- I weight what retirees buy most: food, utilities, transport, medical, and housing.
- I apply effective tax rates to retirement income scenarios to test net outcomes.
- I layer United Health Foundation scores to reflect care quality and access.
This framework helps with planning and lets you test an example: a low index plus a modest home value can outperform a pricier market once taxes and care are included.
Quick answer: the states that lead on pure cost of living
I boiled the numbers down to a short list of everyday affordability leaders. On routine expenses alone, Tennessee and Kansas top the ranking, with Oklahoma, Missouri, and South Dakota close behind.
Key index snapshot: C2ER 2024 shows indices clustered in the low‑90s. That gap versus the national baseline of 100 represents meaningful savings for many on fixed retirement income.
- Tennessee — score 100; index 92.8.
- Kansas — score 100; index 92.9.
- Oklahoma — score 99; index 93.0.
- Missouri — score 99; index 93.1.
- South Dakota — score 99; index 93.3.
- Mississippi, West Virginia, Arkansas, Alabama, New Mexico follow (indices 93.4–96.0).
Expect tight clustering: ranks one through six sit between 92.8 and 93.4, so the cheapest picks can tie depending on your basket.
Action: use this list as a filter—then layer tax, healthcare, and housing to confirm fit for your retirement plan.
Top ten states with the lowest cost of living for retirees
Combining tax context with ZHVI and care costs, I identified ten states where retirement dollars stretch furthest. Below I summarize the leaders and why they matter for your budget and lifestyle.
- Tennessee: Index 92.8 and no tax on wages; an effective state-local tax near 7.6% supports steady retirement income.
- Kansas: Index 92.9 with predictable housing (ZHVI ~$229,012), easing monthly housing costs.
- Oklahoma: Index 93.0; typical home value ~$205,968 and a regional tax burden around 9%.
- Missouri: Index 93.1; broad affordability across groceries, fuel, and property that favors tight budgets.
- South Dakota: Index 93.3; no state income tax helps protect withdrawals and pension distributions.
- Mississippi: Index 93.4; standout care economics—assisted living near $54,943/year and home care ~$24/hr.
- West Virginia: Index 93.9 with the lowest typical homes (~$168,172) for buyers seeking property bargains.
- Arkansas: Index 94.4 and sub-$210K typical homes combine affordability with outdoor amenities.
- Alabama: Index 95.6; varied markets (coastal and inland) offer flexible price points around $227,508.
- New Mexico: Index 96.0; competitive costs plus Southwest lifestyle and cultural benefits.
Action: shortlist 3–4 entries, then compare local taxes, property levies, and nearby healthcare before you move.
States with the cheapest housing for retirees
Mapping typical home values shows which markets trim monthly expenses and preserve retirement cash. I focus on purchase price, local taxes, and upkeep so you can compare real carrying costs quickly.
West Virginia, Mississippi, Louisiana: Sub-$210K typical home values
Start with price: West Virginia (~$168,172) and Mississippi (~$181,313) lead on low typical home values, lowering upfront housing costs and freeing savings for care or travel.
Oklahoma, Arkansas, Kentucky: Consistently low affordability indexes
Scan Louisiana (~$201,519), Oklahoma (~$205,968), and Arkansas (~$208,078) for wide choice. Pair purchase price with local property tax to estimate total carrying costs.
Iowa, Alabama, Kansas, Ohio: Budget-friendly ownership in the Midwest
Kentucky (~$212,088), Iowa (~$220,277), Alabama (~$227,508), Kansas (~$229,012), and Ohio (~$230,798) form the next tier. Cheaper markets often let you pay down principal faster or choose a shorter mortgage.
- Watch maintenance: older inventory can raise repair cost; budget for roofs, HVAC, and accessibility retrofits.
- Model buy vs. rent: owning in low-price areas can beat renting if you plan to stay 7–10 years.
- Location matters: metro edges and smaller cities deliver lower prices with solid services and hospital access.
“Choose a house that fits your daily needs, not just a bargain price.”
Next step: align target neighborhoods with healthcare proximity and everyday services before making an offer.
What state has the lowest cost of living for retirees?
I compared index scores and tax rules to name where daily budgets stretch furthest. On pure index math, Tennessee and Kansas are virtually tied: indices 92.8 and 92.9. That 0.1 gap is functionally negligible.
Why it matters: Tennessee’s low effective state‑local tax (~7.6%) and no wage tax help preserve retirement income and social security purchasing power. Kansas pairs a top index with typical homes near $229,012, which eases mortgage and downsizing options.
Nearby contenders—Oklahoma, Missouri, and South Dakota—sit within about 0.5 points on the index. South Dakota adds tax advantages that can protect withdrawals, while Oklahoma and Missouri often win on local prices.
Practical steps: compare how each place taxes Social Security and pensions, check ZIP‑level grocery and utility rates, and consider Mississippi if long‑term care costs matter more than small monthly savings.
- Rent for 6–12 months to validate your budget.
- Prioritize hospitals and daily services near your target neighborhood.
- If everyday costs are top priority, start with Tennessee or Kansas and refine by tax and care access.
“Start with index leaders, then test taxes, housing, and healthcare to find your real savings.”
Taxes, Social Security, and retirement income: where retirees keep more
I break down tax scores and effective rates to show how much retirement income stays with you.
Start with the shortlist: Alaska, Florida, Nevada, Wyoming, South Dakota, and Tennessee consistently rank as most tax-friendly. That list matters because lower taxes let more of your benefits and savings fund daily life.
Decode effective rates: an effective tax rate blends income, property, and sales burdens. Examples: Alaska (100 / 4.60%), Wyoming (74 / 7.50%), Tennessee (73 / 7.60%), South Dakota (66 / 8.40%).
| State | Tax Score | Effective Rate | Tax on Social Security? |
|---|---|---|---|
| Alaska | 100 | 4.60% | No |
| Wyoming | 74 | 7.50% | No |
| Tennessee | 73 | 7.60% | No |
| South Dakota | 66 | 8.40% | No |
Pair these figures with local property levies and healthcare prices. A low-rate state can still cost more if care or insurance runs high.
- Lower taxes stretch withdrawals and improve net income.
- Check whether social security faces state tax where you plan to move.
- Run a two-state tax scenario on a 3–5 year withdrawal plan to see true savings.
“Tax rules change the math: small rate differences add up over decades.”
Healthcare and long-term care costs can flip the rankings
Healthcare expenses can erase small savings fast when you model a 20–30 year retirement. I look beyond daily indexes to include senior outcomes and long-term services. That change often shifts where your dollars go.
Senior health outcomes matter: Utah (0.755), Colorado (0.722), and Vermont (0.695) rank highest on United Health Foundation measures. Better quality can lower complications, ER visits, and downstream expenses.
Care price ranges that alter plans
- Assisted living: Mississippi ≈ $54,943/year vs. Hawaii ≈ $139,807/year.
- Memory care: Wyoming ≈ $4,025/month vs. Hawaii ≈ $11,000/month.
- Home care: Mississippi ≈ $24/hour vs. Minnesota ≈ $43/hour.
| Metric | Low example | High example | Impact |
|---|---|---|---|
| Assisted living (year) | Mississippi — $54,943 | Hawaii — $139,807 | Up to $84k gap; dominates budgets |
| Memory care (month) | Wyoming — $4,025 | Hawaii — $11,000 | Affects long-term savings and placement |
| Home care (hour) | Mississippi — $24 | Minnesota — $43 | Changes feasibility of aging in place |
| Per-capita health spend (year) | Utah — $7,522 | New York — $14,007 | Signals systemic cost differences |
Action: model three scenarios—healthy, moderate care, high care—using local prices and insurance options. Pair that with Medigap or Medicare Advantage network checks to avoid surprises and guide planning.
Best affordable places within low-cost states
I focused on places that pack trails, hospitals, and cultural life into an affordable package. Each entry blends everyday value with services that support long-term life choices.
Chattanooga, Tennessee • Topeka, Kansas • Tulsa, Oklahoma
Chattanooga pairs arts districts and outdoor recreation with reasonable housing and easy healthcare access.
Topeka offers lake amenities at modest prices—good for boating and local activities near retirement home options.
Tulsa brings River Parks trails and solid hospital networks while remaining budget-friendly.
Sioux Falls, South Dakota • Columbus, Ohio • Des Moines, Iowa
Sioux Falls ranks well for successful aging and abundant medical professionals.
Columbus gives university resources and free non-credit courses for older adults; Des Moines lands in Milken’s top list for large metros with lower prices.
Myrtle Beach, South Carolina • Hot Springs, Arkansas • Sherman, Texas
Myrtle Beach, South Carolina delivers coastal access and affordable beach life compared with many Atlantic markets.
Hot Springs mixes wellness activities, thermal baths, and calm scenery for a slow pace.
Sherman keeps costs low while giving quick access to Dallas‑Fort Worth specialists and airports.
- Match lifestyle: coast, mountains, city, or small‑town living—pick places that suit your preferred activities and social life.
- Verify access: map drive times to hospitals, primary care, and pharmacies before you commit.
- Check tax and services: local sales and property rates vary; a friendly state tax score can be offset by city or county levies.
- Try before you buy: a 1–3 month furnished rental helps test weather, activities, and community fit.
“Choose a place that supports your daily routine—access to healthcare and activities matters as much as price.”
How to choose your state: factors beyond price
A good plan starts with service access, safety, and travel links. I prioritize practical factors that shape daily life and long-term care options. These determine whether a low bill truly buys comfort or creates hidden hurdles.
Access to hospitals, crime rates, airports, and everyday services
Prioritize access: choose a place with hospitals, urgent care, and primary care within a short drive. Quick access reduces stress and costs when health events happen.
Assess safety and services: review local crime reports, grocery and pharmacy coverage, and municipal upkeep. These services shape daily life and social engagement.
Check connectivity: if you travel often, proximity to airports with nonstop routes matters more than a small tax or rent saving. Good air links keep family visits and medical travel simple.
Test-drive before you move: visit in multiple seasons and rent first
Validate seasons: visit in summer and winter to judge humidity, storms, or snow. Weather affects mobility, activities, and social life—so test it.
Rent first: a 6–12 month lease reveals HOA rules, noise, and commute times. Renters learn what daily life actually feels like before a big purchase.
- Plan for age: look for walkability, transit, and senior services that support independence as needs change.
- Explore options: tour multiple areas in a target region to compare parks, noise, and municipal services.
- Run the numbers: model tax, insurance, utilities, and HOA dues alongside rent or mortgage to see true cost.
Build your plan: create a checklist—healthcare access, safety, taxes, activity options—and score each candidate. I also recommend reading a financial overview to pair choices with long-term benefits: best financially friendly options.
“Test your assumptions on the ground: services and seasons reveal what numbers alone cannot.”
Conclusion
This wrap-up gives clear steps to narrow choices and protect retirement income over 20–30 years. I recommend starting with Tennessee (C2ER 92.8) and Kansas (92.9) if everyday savings matter most.
Look beyond index numbers: West Virginia and Mississippi offer sub‑$210K homes (≈$168,172 and $181,313) that free cash for care or upgrades. Mississippi’s assisted living (~$54,943/year) and $24/hour home care shift lifetime expenses fast.
Factor taxes and healthcare: Alaska, Florida, Wyoming, South Dakota, and Tennessee protect take‑home income. Utah, Colorado, and Vermont lead on senior health outcomes—balance those gains against your budget and preferred cities like Chattanooga, Topeka, Tulsa, or Myrtle Beach.
Simple decision rule: shortlist three states to retire in, rent a season, run a side‑by‑side retirement income and tax example, then choose the home and area that match your lifestyle and long‑term security.
