Best States to Retire 2022

Are you thinking about where to spend your golden years? Retirees have many factors to consider when deciding the best place for retirement. Some Americans want to be closer to family, while others prioritize warmer weather or lower living costs.

No matter your priorities, a few states are especially friendly to retirees. We’ve scoured the research, looking at the data and evaluation methodology from various independent sites to find which states appear repeatedly. You might think states like Texas, New Mexico, or Nevada are top choices, but you’d be surprised.

The list of top states runs the gamut. Some present s more favorable cost of living and affordable housing markets, while others boast a higher quality of life with more recreational activities or robust healthcare.

As you contemplate where to live in your retirement, use our list of 2022’s best states to retire to start your research.

Florida

Florida has a reputation as a retirement haven, and for a good reason. It appears several times on various lists, setting no. 1 on Bankrate’s 2022 list. Florida is tough to beat, with no individual income tax, year-round warm weather, and a relatively low cost of living. In Florida, retirement income stretches further, especially if you’re coming from more expensive markets in the northeastern United States, like New York, Connecticut, and Massachusetts.

Retirees 65+ who meet the residency requirements established by Florida state law do not have to pay taxes on their pension and retirement income. Social security benefits are also exempt from taxation. Other great news for retirees: there is no inheritance tax or estate tax, and an exemption from debt collection exists on assets held in IRAs or similar accounts.

Additionally, Florida boasts beautiful weather and plenty of activities for retirees. The state has over 1,000 golf courses, 900 miles of oceanfront coastline, plus countless lakes, rivers, and freshwater springs. Cities up and down the state have a full suite of recreational options, with museums, performing arts centers, professional sports venues, and festivals of all types.

Healthcare is also top-notch in the Sunshine State. According to research by America’s Health Rankings, Florida scores highly in Hospice care, community support, and cancer screenings. The state has many primary care physicians, specialists, behavioral health, nursing care centers, V.A. centers, and dentists.

Georgia

Like Florida, Georgia has a reputation for being retiree-friendly, and it, too, offers a long list of advantages. Bankrate listed it as no 2, citing the state’s cost of living, particularly regarding its overall housing affordability.

In Georgia, pension and retirement income have a $65,000 tax exemption, and Social Security benefits are tax-free. If you’re a senior citizen aged 62 and over with low income, you may qualify to double your homestead exemption.

Georgia ranks fifth-warmest state, meaning retirees have more days to enjoy the great outdoors. That’s a good thing, as the Peach State has over 350 golf courses, plus many parks, lakes, and rivers. The southeast borders the Atlantic Ocean, and its Sea Islands like Hilton Head and Cumberland Island are top attractions.

State capital Atlanta is home to professional baseball, basketball, football, and hockey teams. Outside of sports season, Atlanta has significant museums, performing arts centers, and venues for live music. Noteworthy historical attractions are spread across Georgie, from Savannah to Kennesaw.

Utah

Utah appeared on three different retirement lists, with WalletHub ranking it as no. 8. While its metrics in affordability don’t necessarily stand out, the state is an excellent choice for an active lifestyle. America’s Health Rankings says it’s the healthiest state in the U.S.

Income taxes in Utah are higher than in some states on our list. Individuals paid a flat state income tax rate of 4.85% for 2021. Utah does tax Social Security benefits and most forms of retirement income from taxation, but it also has tax credits for Social Security and former military personnel. A retirement tax credit is available for up to $450 per year. Homeowners 66 and older can also apply for a property tax credit.

Utah’s population skews younger, but residents tend to have a higher life expectancy and overall well-being. The less densely crowded state has ample room to spread out. The state also boasts one of the lowest crime rates in the U.S. and high air and water quality.

The state is a nature lover’s dream, with plenty of opportunities for outdoor recreation. The famous Zion, Arches, and Bryce Canyon are among the state’s five national parks, complemented by an additional 43 state parks. Utah claims to have the greatest snow on Earth, making it a top destination for skiing and snowboarding.

Utah residents can also visit the world-famous Sundance Film Festival or one of the state’s concert venues. Thousands come to the Salt Lake Arts Council’s twilight concert series every summer.

With nearly 60 hospitals, Utah offers residents plenty of options for their healthcare needs. U.S. News and World Report has ranked several Utah hospitals as high-quality centers, with the University of Utah Hospitals and Clinics as no 1 in the state. This top choice specializes in adult care, making it a convenient option for retirees whose needs may change with age.

Michigan

Your first thought might be, “but Michigan’s cold!” The thing is, Michigan is hard to beat for affordability. Bankrate says it’s the most affordable state in the U.S., based on the residential tax burden and the cost of living.

Michigan levies a flat 4.25% state income tax and some municipalities also charge income taxes. Military and railroad pensions plus social security are tax-exempt. Other Michigan income tax rates depend on when the retiree was born. Those born before 1946 who have federal or Michigan government retirement pensions are exempt. For individuals, up to $54,404 of income from private retirement plans is exempt; the amount doubles for joint filers.

Taxpayers born between 1946 and 1952 can have up to $20,000 of their retirement income exempted from taxation. Income from government pension sources has a higher exemption, at $35,000.

The state does have a sales tax of 6%, but food and prescription drugs are exempt. Senior low-income citizens could be eligible for a Homestead Property Tax Credit.

Even with an individual tax rate, though, more retirees find their dollar stretches further to lower real estate, utility, and essentials costs.

Weather-wise, Michigan experiences all four seasons. Over 100 state parks and recreation areas provide countless boating, fishing, snowmobiling, and hiking opportunities.

Missouri

Stretch retirement savings further in Missouri, thanks in large part to its low cost of living, according to Bankrate and SmartAsset.

The state has a graduated income tax rate from 1.5% to 5.4%, and some jurisdictions collect an individual income tax. Social Security benefits are eligible for a 65% tax deduction. Other forms of retirement income may be partially tax-exempt, such as government pensions. Up to $6,000 is deductible in private pension income. These deductions come with varied income limits.

Missouri residents over 65 can qualify for a property tax credit of up to $750 if they rent or up to $1,100 if they own their home. There are income limits that apply to this credit.

Two state hospitals rank nationally, with Barnes-Jewish Hospital in St. Louis no 14 for senior care.

With a moderate climate and large swaths of rural areas, retirees can take advantage of Missouri’s many outdoor activities. The state is home to six national parks, 80 state parks, and 12 trails. Its ample lakes give it more coastline than California. The rolling hills are fertile, with an abundance of wineries and craft breweries. Professional MLB, NFL, and NBA sports teams are based in St. Louis and Kansas City.

Tennessee

If you’re looking for low taxes and a low cost of living, consider Tennessee. The Volunteer State does not tax Social Security benefits, pensions, or income from most investments. Even better–it’s one of the seven states without an individual income tax! Its affordability and warmer weather earned it high marks from Bankrate.

Property taxes are low, charged at only 25% of the home’s value. Senior citizens with low income may be eligible for a property tax freeze. The state has a higher sales tax of 7%, but food and prescription drugs are exempt.

Tennessee takes pride in its outdoor attractions. The Great Smoky Mountains National Park is one of the most visited in the United States.

A thriving arts and music scene includes the Country Music Hall of Fame and Museum in Nashville and Elvis Presley’s Graceland in Memphis. Live music is part of the state’s lifeblood; Tennessee hosts Bonnaroo, one of the world’s largest music festivals.

North Dakota

North Dakota may be another surprising edition, but WalletHub placed it no. 6 for its low cost of living. America’s Health Rankings ranks it in the top 10 for health outcomes.

The state does not tax Social Security benefits, but retirement accounts and pensions are taxable income. Depending on income limits, some of the pension income may be deductible. The graduated income tax ranges from 1.4-2.9%.

A Homestead Tax Credit or Renter’s Refund is available to senior citizens (age 65 and older) who own or rent their home, but it varies based on your income and asset value.

Outdoor enthusiasts will enjoy rural North Dakota. A low per capita population translates to abundant ranch land, scenic parks, and wildlife refuges. Visit its lakes in the summer for fishing and swimming.

Virginia

According to WalletHub and CNBC, Virginia ranks no. 2 for retirement in 2022. It scored highly in quality of life and overall affordability. Plus, Virginia has quality health care, a mixture of topography, and plenty of things to do.

Social Security benefits are tax-exempt; otherwise, the state levies a 5.75% income tax rate. Seniors can deduct up to $12,000 in pension and other retirement income from state-taxable income. Real estate tax relief is available to residents 65 and older who meet income and asset requirements.

Virginia has no shortage of activities. If you love being outdoors, you can hike the Blue Ridge mountains or play golf on one of the many luxury courses. For those interested in history, explore the many museums and monuments. From the coast to the Shenandoah Valley, Virginia has something for everyone.

New Hampshire

New Hampshire is one of the seven with no individual income tax. Social Security benefits, pensions, or most investment income are tax-exempt. Uniquely, the state also has no sales tax.

However, its tax foundation is supported by high property taxes. The median property tax in New Hampshire is $3,144, much higher than the national average of $1,917. An exemption is available to those 65 and older who have lived in New Hampshire for at least three years.

Despite the high property taxes, New Hampshire has a low cost of living overall. Plus, the Granite State is known for its rugged mountains and stunning beauty in all four seasons. Fish its lakes or enjoy skiing in the winter. Its healthcare had an overall placement of no. 6, with high marks in safety, social engagement, preventive care, behavior care, and overall physical health.