Cost of living : 5 percent below U.S. average
Population : 10.5 million
Best city : Asheville
PROS: With mild temperatures and mostly comfortable weather all year round, North Carolina could be a nice change for retirees who are sick of cold winters or hot summers. The cost of living is below average and real estate is pretty affordable if you are not looking in the Kill Devil Hills area. Also, Social Security benefits are not taxed.
CONS: The cost of living may be low, but so are the incomes with an average of $43,616 for residents that are 65 and over. And although Social Security is not taxed, other retirement income is, at a set rate of 5.9 percent.
Cost of living : 17 percent below U.S. average
Population : 3 million
Best city : Bella Vista
PROS: The Natural State offers an impressively low cost of living and the third lowest healthcare costs for retired couples around. It is renowned for its natural beauty, wildlife, hot springs, rivers, and mountains and has plenty of outdoor pastimes to excite the active senior.
CONS: The taxes in Arkansas are steep. Most retirement income is taxed and only Social Security and up to $6,000 of other retirement funds are exempt. Income tax rates can go as high as 6.9 percent, if your income is over $75,000. The state has the eighth-highest poverty rate for seniors in the nation. There is also not a big city anywhere to be seen and the state gets more than its fair share of tornados.
Cost of living : 4 percent above U.S. average
Population : 5.7 million
Best city : Osseo
PROS: If you have health problems or are worried about having them, Minnesota could be the state for you. It was ranked as the “healthiest in the country for seniors” by the United Health Foundation. It is also the home of the world-famous Mayo Clinic in Rochester. This state is a good choice for the health-conscious.
CONS: Unfortunately, Minnesota has an unideal combination of a slightly higher than average cost of living with below-average annual income. It also taxes Social Security as much as the Federal government and doesn’t exempt other retirement incomes. Plus, the winters are extremely cold and snowy.
Cost of living : 2 percent below the U.S. average
Population : 1.3 million
Best city : Portland
PROS: The perfect place for seafood lovers, you’ll never have a problem getting fresh lobster in Maine. With the cost of living and healthcare costs below the national average, retirees can get more bang for their buck in the Pine Tree State.
CONS: While the tax situation in Maine is not bad, it is not great either with most retirement income taxable. On the other hand, Social Security is exempt and estate tax only applies to expensive estates worth $11.8 million or more. Income levels are not high. Senior households bring in 25.2 percent less than the U.S. average.
Cost of living: 27 percent above U.S. average
Population: 9.4 million
Best city: Long Beach Township
PROS: The Garden State has a lot to offer retirees. There are many things to see and do, including walking the famous boardwalk or sitting on a bench and enjoying the view in Ocean City. With the great New York City only a train ride away. New Jersey is also rife with history for those who love to learn.
CONS: When you consider the quality of life in states such as South Dakota and Montana, New Jersey has a much higher cost of living. Health care and property taxes are also expensive. This state would not be a good fit for seniors who are on budget or are trying to get the most out of their pensions.