You’ve probably seen dozens of lists of places to retire in, but they seldom focus on financial factors, which are important when you live off your savings. Due to warm weather, beaches, and the absence of a state income tax, locations in Florida are heavily over-represented on most such lists – I even included one here.
But I took the liberty of assuming that not everyone wants to live out their golden years in the Sunshine State, and broadened the list to cover the country. On this list, I zero in on the tangible financial and economic benefits for retirees, because you shouldn’t be spending your golden years worrying about bills.
Here are the five criteria I use in deciding which cities are best for retirees financially.
1. Cost of living. An index of 100 represents the U.S. average. The cities listed here have a range from 88 to 116.
2. Overall tax burden by state, taking in income, sales, real estate and other taxes. The national average is 9.9 percent of income, while the tax rates of some of the cities here are lower than 9 percent.
3. Median house prices. Some cities on the list have home prices higher than the national average, $198,500, but are still relatively low in their respective parts of the country.
4. Weather, natural amenities, and cultural environment. While preferences for temperatures and things to do differ, they can translate into lower living expenses. For example, a mild climate usually means lower utility bills. And an abundance of local attractions reduces the need for travel.
5. Strength of the job market as determined by unemployment rates. Retirees often return to the job market because they need the money or have too much time on their hands. In addition, strong local employment also creates investment opportunities close to home, particularly in rental real estate.
With that in mind, on to the list.