15 Affordable Places to Live in Retirement
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15 Affordable Places to Live in Retirement

Are you worried that you won’t have enough cash to live in retirement?

If you have those “retirement fears,” you aren’t alone.

It’s inevitable that most of us will retire, either by choice or necessity. Earning, saving, and investing more are certainly important for retirement. But the other side of the equation is keeping costs low.

The Employee Benefit Research Institute found, when surveying workers about having enough money to retire:

  • 13% of workers are very confident in having enough money to retire.
  • 38% are somewhat confident they’ll have enough money to retire.
  • 49% are not too confident they’ll have enough money to retire.

With almost half the number of workers surveyed not confident they’ll have enough money to retire, cutting costs in retirement is a must.

This recent Daily Capital article, “A Potentially Easier Way to Get Rich: Move to the Midwest,” points out many of the financial reasons to live in a lower cost of living area. Although the article focuses on cutting costs during your working years, the point is even more pertinent when retirement rolls around.

After your most profitable earning years are behind you, keeping lifestyle costs in check can mean the difference between a comfortable retirement and a financially stressful one.

Here’s an alternative affordable retirement approach, which is quite viable for those of you who haven’t saved a lot and still want to retire sooner rather than later. Although we’ve suggested retiring abroad to cut costs, there is an abundance of low cost of living locations right here in the United States.

15 Affordable Locations to Live in Retirement

If you’re thinking of finding places on our retirement list like Maui, Oahu, Kauai, Malibu, Laguna Beach, San Diego, and San Francisco, you’ll be sorely disappointed. But if you’re willing to take a little adventure and explore our great nation, we think you’ll be surprised on the upside.

Consider moving to one of these lower cost of living areas in retirement and watch your Social Security income cover most of your living expenses. Many of these lower cost of living areas include a warmer climate and proximity to the beach too. There are also a few locations with favorable tax benefits.

  1. Pittsburgh, Pennsylvania is a beautiful city with rolling hills and several top notch colleges and universities to provide entertainment and stimulation. The median home price is $119,600 and cost of living falls 8.5% below the national average.
  2. Indianapolis, Indiana offers a beautiful and green landscape with a cost of living 12.8% below the national average. There are many parks, trails, great health care, and an exciting downtown. The grandkids will love visiting the nationally recognized Children’s Museum.
  3. Omaha, Nebraska at 11.7% below the national average, this is another retirement bargain. Omaha even won an award as the number 3 Best City for Successful Aging report (sponsored by the Milken Institute). Omaha excels at art, music and culture with the Joslyn Art Museum and Holland Performing Arts Center. If it’s good enough for Warren Buffett, isn’t it good enough for you?
  4. Decatur, Alabama is also called “The River City” due to its location on the banks of Wheeler Lake and Tennessee River. Located in Northern Alabama, its central location is close to both Chattanooga and Atlanta. The weather is mild and cost of living almost 11% below the national average. The average home goes for a bargain $127,000.
  5. Tulsa, Oklahoma not only boasts a low cost of living (11.6% below average) but additional benefits; no tax on Social Security, no state estate tax and low property taxes. The city offers world class art, ballet, a zoo, and over 140 parks.
  6. Tampa, Florida has a nice mix of culture, sun, and beach. This city is home to the University of Southern Florida and Tampa University which gives retirees access to a wealth of theatre and drama to supplement the offerings of the city proper. Tampa has fewer retirees than other Florida cities for those who desire a more diverse age range.
  7. Clarksville, Tennessee is number one on Bankrate’s list of best places to retire. This location also boasts low tax burdens and a cost of living 7% below the national average. For the water lovers, Clarksville’s location on the Cumberland River offers natural beauty and access to water related activities.
  8. Corpus Christi/Rockport, Texas are home to many recommended low cost of living locations. Over 28% of the population is over 65, so residents will find plenty of company and activities geared to the active retiree. Rockport Beach is the only Texas beach certified by the Clean Beaches Council in Washington D.C. Although the cost of living is 9% below the nations, the Rockport location isn’t great for healthcare. The closest hospitals are 40 minutes away, in Corpus Christie.
  9. Aiken, South Carolina boasts a median home value of $96,600. For the golf lover, this town is home to the Masters Golf Tournament. It’s location outside of Augusta, Georgia is in the center of South Carolina’s horse country. In addition to horses and golf, Aiken has beautiful parks, art museums, and historic architecture.
  10. Daytona Beach, Florida is another Florida location with warm weather, beaches, and low cost housing. The $139,000 median home price (according to Trulia) is quite reasonable for a sea side locale. The state also boasts no state tax on Social Security or Pensions. Auto racing aficionados will love the “car vibe” in the community.
  11. Pocatello, Idaho is ideal for nature lovers. The native beauty and surrounding mountains are breathtaking. Cheap housing and no Social Security tax add to the financial benefits of Pocatello. According to Sperling’s bestplaces.net, you can grab a 2 bedroom home or apartment for under $500 and the overall cost of living is 10% below average.
  12. Bangor, Maine is on the upper cost end of the retirement locations at about 100% of the average U.S. cost of living. Located in the eastern part of the country Maine has many attributes in its favor. The state lacks tax on Social Security. This New England location gives access to beautiful natural beauty, skiing, hiking, and fishing. This small town is another perfect location for outdoor enthusiasts.
  13. South Bend, Indiana is in the lowest range of home values with a median home price of $82,500. Sports fans will enjoy Notre Dame Football and Notre Dame Women’s Soccer is only $3 a game. If you enjoy big city life, you’re a short drive from Chicago. South Bend recently created an exciting river walk along the St. Joseph River (with artificial whitewater rafting).
  14. Grand Rapids, Michigan is known for its outdoor and adventure opportunities. Close to Lake Michigan, Grand Rapids is a great destination for boating, fishing, and water sports. With the median home price at $103,000, and no state tax on Social Security, this affordable destination is beautiful and another inexpensive spot for the outdoor devotee.
  15. Louisville, Kentucky is a picturesque small city with a cost of living hovering near 9% below average. The Kentucky Derby adds to the excitement of this town, as do the university sports. With biking trails, parks and large bourbon production, Louisville is a fun place to retire.

Don’t let the retirement industry scare you. Even with a smaller nest egg, there are an abundance of great affordable retirement locations, across the country. You just have to give other places a chance.

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Related: Retirement Might Not Cost As Much As You Think 

Photo: Autumn in Omaha, Daniele Valdifiori, Flickr Creative Commons 


  • http://www.grandparents.com/money-and-work/retirement/cheapest-places-retire
  • http://www.aarp.org/home-family/your-home/info-09-2013/best-places-to-retire-social-security.2.html
  • http://www.bestplaces.net/
  • http://www.ebri.org/publications/ib/?fa=ibDisp&content_id=5175

The content contained in this blog post is intended for general informational purposes only and is not meant to constitute legal, tax, accounting or investment advice. You should consult a qualified legal or tax professional regarding your specific situation. Keep in mind that investing involves risk. The value of your investment will fluctuate over time and you may gain or lose money.

Any reference to the advisory services refers to Personal Capital Advisors Corporation, a subsidiary of Personal Capital. Personal Capital Advisors Corporation is an investment adviser registered with the Securities and Exchange Commission (SEC). Registration does not imply a certain level of skill or training nor does it imply endorsement by the SEC.

Barbara Friedberg, MBA, MS is an investment portfolio manager, former university finance instructor, and website publisher at Barbara Friedberg Personal Finance.com. Her recent book, "How to Get Rich; Without Winning the Lottery", is available on Amazon. Barbara excels at teaching wealth building through investing. You can follow her on Twitter at @barbfriedberg
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