12 Best States for Retirement: 2023

There’s a common narrative that retirees leave colder or high-cost states for traditional retirement destinations with warmer weather, a relatively low cost of living and other perks for seniors, according to a report on the best states for retirement released Monday by Bankrate.

But while that continues to be the case in 2023, experts advise older Americans not to rule out places that are not traditionally top of mind for retirement, the report said.

Bankrate’s study noted that many people consider a late-life move, but in fact, most American retirees age in place. It cited a 2022 Census Bureau report that from 2015 to 2019, only 6.2% of the population older than 65 had moved in a given year, compared with 15% of younger people.

Still, most retirees are relocating to meet their changing preferences and needs. An analysis from the American Planning Association found that more senior movers are renters, including those with lower incomes, those with higher housing cost burdens and those who live alone.

Most Americans do not feel confident about their retirement savings, Bankrate said. A survey the firm conducted in October found that 55% of working Americans said their retirement savings are not where they need to be, and 35% said they were significantly behind. That percentage went up with age, according to the survey.

Bankrate’s new study identified states that are much more affordable than others for retirees looking to stretch their retirement income.

One perk of relocating to an area where the real estate market is more affordable and less competitive is taking advantage of the equity built up in the home that is left behind and paying cash for a new home, according to Kerry Hannon, a retirement expert cited by Bankrate.

“If you can do so, maybe you can sell your home where you live right now and move to an area of the country that’s less expensive, and not have to have a mortgage,” Hannon said.

For those considering relocating, she also suggests looking for towns or cities with more reasonable health care costs because that is a sizable cost cutter for retirees. “Don’t move necessarily for the sunshine, but maybe for the healthcare costs,” she said.

Personal finance expert Shang Saavedra, also cited by Bankrate, says that for retirees to know where you’re going, they need to understand where they are with their retirement savings.

“Determining how much you have available for retirement then leads to all the other decisions for your lifestyle,” she said.

“Once you know that, look at your expenses today and ask yourself: ‘Can I afford that?’ If not, then the biggest impact would be determining where to live.”

To find the best states for retirement in 2023, Bankrate examined five categories. Researchers gave heaviest weighting to affordability, which they calculated by using the 2023 cost-of-living index from the Council for Community and Economic Research, state property and sales tax rates from the Tax Foundation’s rankings for 2023 and cost of homeowner’s insurance by state from ATTOM Data Solutions.

They based wellness rankings on 2020 and 2021 data from the U.S. Census Bureau, and the Sharecare Community Well-Being Index released in 2021.

For health care quality and costs in the rankings, Bankrate considered health care establishments per capita for 2021 from the U.S. Census Bureau, state health system performance and cost of health care per capita across all 50 states. State health system performance was based on 2022 data from The Commonwealth Fund.

For weather scores, researchers relied on decades of average annual temperature data from the National Oceanic and Atmospheric Administration, and also analyzed NOAA data for tornado strikes and hurricane landfalls, along with earthquake reports from the U.S. Geological Survey.

Lastly, they calculated crime using the rates of property crimes and violent crimes per 100,000 inhabitants for each state from the FBI’s 2019 Crime in the United States report.

See the gallery for the 12 best states for retirees in 2023, according to Bankrate.