The best states to retire in 2026 are Florida, Tennessee, and Wyoming — all three have zero state income tax, and Wyoming’s total state tax burden on a $60,000 retirement income is just $2,575 per year compared to $7,950 in New York. Where you retire can save or cost you tens of thousands of dollars over a retirement. State taxes, cost of living, healthcare access, and climate all matter. Here’s a data-driven look at the best and worst states for retirement.
Choosing a retirement destination isn’t just about finding warm weather or a low tax rate. The best states for retirees balance multiple factors: how much of your Social Security benefits and retirement savings gets taxed, what your day-to-day expenses look like, whether quality healthcare is accessible nearby, and whether the climate suits your lifestyle. We evaluated every state across these categories to build a comprehensive ranking.
Top 15 Best States for Retirees (Overall)
Our overall rankings weigh four major factors: state tax burden on retirement income, cost of living, healthcare access and quality, and climate. No single state is perfect in every category — Florida’s warm weather and zero income tax come with a higher cost of living, while Mississippi’s rock-bottom expenses are offset by limited healthcare. The key is matching your priorities to the right state.
| Rank | State | Tax Score | Cost of Living | Healthcare | Climate | Overall |
|---|---|---|---|---|---|---|
| 1 | Florida | ★★★★★ | ★★★☆☆ | ★★★★☆ | ★★★★★ | A+ |
| 2 | Tennessee | ★★★★★ | ★★★★☆ | ★★★☆☆ | ★★★★☆ | A |
| 3 | Wyoming | ★★★★★ | ★★★★☆ | ★★★☆☆ | ★★★☆☆ | A |
| 4 | Nevada | ★★★★★ | ★★★☆☆ | ★★★☆☆ | ★★★★☆ | A |
| 5 | South Dakota | ★★★★★ | ★★★★☆ | ★★★☆☆ | ★★☆☆☆ | A- |
| 6 | Texas | ★★★★★ | ★★★★☆ | ★★★☆☆ | ★★★★☆ | A- |
| 7 | Delaware | ★★★★☆ | ★★★☆☆ | ★★★★☆ | ★★★★☆ | A- |
| 8 | South Carolina | ★★★★☆ | ★★★★☆ | ★★★☆☆ | ★★★★★ | A- |
| 9 | Georgia | ★★★★☆ | ★★★★☆ | ★★★★☆ | ★★★★☆ | B+ |
| 10 | Mississippi | ★★★★☆ | ★★★★★ | ★★☆☆☆ | ★★★★☆ | B+ |
| 11 | Arizona | ★★★★☆ | ★★★☆☆ | ★★★★☆ | ★★★★★ | B+ |
| 12 | North Carolina | ★★★☆☆ | ★★★★☆ | ★★★★☆ | ★★★★☆ | B+ |
| 13 | Alabama | ★★★★☆ | ★★★★★ | ★★☆☆☆ | ★★★★☆ | B+ |
| 14 | Pennsylvania | ★★★★☆ | ★★★☆☆ | ★★★★☆ | ★★★☆☆ | B |
| 15 | New Hampshire | ★★★★★ | ★★☆☆☆ | ★★★★☆ | ★★☆☆☆ | B |
Florida earns the top spot due to its combination of zero state income tax, year-round warm weather, strong Medicare provider network, and the nation’s largest population of retirees — which means communities, services, and infrastructure are built with retirees in mind. Tennessee is the value pick: it combines zero income tax with a cost of living roughly 10% below the national average, access to four distinct seasons, and a fast-growing metro area in Nashville with excellent healthcare facilities.
States like Wyoming, Nevada, and South Dakota earn top tax scores but rank lower overall due to harsher winters (Wyoming, South Dakota) or a more limited healthcare infrastructure in rural areas.
States With No Income Tax
Nine states charge no state income tax at all, which means your Social Security, pension, 401(k) withdrawals, and IRA distributions are completely free from state income tax. However, these states still need revenue, so they typically have higher sales taxes, property taxes, or both. The table below shows the full picture.
| State | Income Tax | Sales Tax | Property Tax (Effective Rate) | Cost Index |
|---|---|---|---|---|
| Alaska | None | None | 1.04% | 128 |
| Florida | None | 6.0% | 0.86% | 103 |
| Nevada | None | 6.85% | 0.53% | 104 |
| New Hampshire | None* | None | 1.93% | 113 |
| South Dakota | None | 4.5% | 1.08% | 92 |
| Tennessee | None | 7.0% | 0.56% | 90 |
| Texas | None | 6.25% | 1.68% | 93 |
| Washington | None | 6.5% | 0.87% | 110 |
| Wyoming | None | 4.0% | 0.55% | 95 |
*New Hampshire taxes interest and dividends only (being phased out).
The tradeoffs are worth examining closely. Texas has no income tax, but its effective property tax rate of 1.68% is among the highest in the country — on a $300,000 home, that’s over $5,000 per year in property taxes alone. Tennessee’s 7% sales tax (the highest in this group) adds up on everyday purchases. Alaska has no income or sales tax but has a very high cost of living (cost index of 128) and long, dark winters that don’t appeal to most retirees. For the best balance of low total taxes and livability, Wyoming, Nevada, and Tennessee stand out.
States That Exempt Retirement Income
Beyond no-income-tax states, several states with an income tax still exempt most or all retirement income — making them effectively tax-free for retirees even though working residents pay state income tax. This is an important distinction that many retirees overlook. For a detailed breakdown, see our state taxes on retirement income guide.
| State | Social Security | Pension | 401(k)/IRA | Military |
|---|---|---|---|---|
| Illinois | Exempt | Exempt | Exempt | Exempt |
| Iowa | Exempt | Exempt | Exempt | Exempt |
| Mississippi | Exempt | Exempt | Exempt | Exempt |
| Pennsylvania | Exempt | Exempt | Exempt | Exempt |
| Alabama | Exempt | Exempt (state/local) | Taxed | Exempt |
| Hawaii | Exempt | Exempt (state) | Taxed | Taxed |
| Michigan | Exempt | Partially exempt | Partially exempt | Exempt |
Illinois and Pennsylvania are especially noteworthy because they exempt all retirement income — Social Security, pensions, 401(k), and IRA withdrawals — yet they aren’t typically thought of as “retirement states” due to cold winters and higher property taxes. For retirees who don’t mind the climate and already own a home in one of these states, staying put can be a smart financial move. Mississippi offers the same full exemption with a much lower cost of living, making it one of the most tax-efficient states for retirees on a modest fixed income.
Tax Comparison: Retiree With $60,000 Income
Tax rankings don’t tell the full story on their own. To make the comparison concrete, we calculated the total state tax burden for a typical retired couple earning $60,000 per year — a realistic income for many retirees drawing from a mix of Social Security, a pension, and retirement account withdrawals.
Assuming $24,000 Social Security + $20,000 pension + $16,000 IRA withdrawal:
| State | State Income Tax | Sales Tax (est.) | Property Tax ($250K home) | Total State Tax |
|---|---|---|---|---|
| Florida | $0 | $1,800 | $2,150 | $3,950 |
| Tennessee | $0 | $2,100 | $1,400 | $3,500 |
| Texas | $0 | $1,875 | $4,200 | $6,075 |
| Wyoming | $0 | $1,200 | $1,375 | $2,575 |
| Nevada | $0 | $2,055 | $1,325 | $3,380 |
| Illinois | $0 | $1,563 | $4,750 | $6,313 |
| Pennsylvania | $0 | $1,200 | $3,500 | $4,700 |
| Mississippi | $0 | $2,100 | $1,700 | $3,800 |
| Georgia | $1,600 | $1,350 | $2,200 | $5,150 |
| Arizona | $650 | $1,575 | $1,575 | $3,800 |
| North Carolina | $1,900 | $1,350 | $2,100 | $5,350 |
| California | $1,250 | $2,288 | $2,000 | $5,538 |
| New York | $2,500 | $1,200 | $4,250 | $7,950 |
| Connecticut | $2,000 | $952 | $4,500 | $7,452 |
| Minnesota | $2,200 | $1,350 | $2,750 | $6,300 |
Wyoming, Nevada, and Tennessee offer the lowest total state tax burden for retirees.
This comparison reveals some surprises. Texas, despite having no income tax, ranks as the 4th most expensive state on this list because of its high property tax rates. Illinois is even worse — its property taxes are among the highest in the nation, pushing total taxes above $6,300 despite zero income tax on retirement distributions. Meanwhile, Arizona manages a total tax burden of just $3,800 even though it does have an income tax, because its rates are low and property taxes are modest.
The difference between the cheapest state (Wyoming at $2,575) and most expensive (New York at $7,950) is $5,375 per year — money that could significantly extend a retirement nest egg when invested over 20+ years.
Cost of Living for Retirees by State
Taxes are only part of your retirement spending picture. Housing, healthcare, food, transportation, and utilities make up the bulk of your monthly budget, and these costs vary dramatically by state. The table below shows estimated monthly expenses for a retired couple in each state, giving you a realistic picture of what retirement actually costs on the ground.
Monthly budget for a retired couple:
| State | Housing | Healthcare | Food | Transport | Utilities | Monthly Total |
|---|---|---|---|---|---|---|
| Mississippi | $900 | $650 | $500 | $400 | $350 | $2,800 |
| Oklahoma | $950 | $680 | $510 | $420 | $370 | $2,930 |
| Arkansas | $920 | $660 | $520 | $410 | $380 | $2,890 |
| Alabama | $950 | $670 | $510 | $430 | $390 | $2,950 |
| Tennessee | $1,050 | $680 | $510 | $420 | $360 | $3,020 |
| Georgia | $1,100 | $690 | $520 | $430 | $380 | $3,120 |
| South Carolina | $1,100 | $690 | $530 | $420 | $380 | $3,120 |
| Arizona | $1,200 | $700 | $530 | $440 | $340 | $3,210 |
| Florida | $1,350 | $710 | $540 | $450 | $400 | $3,450 |
| Texas | $1,150 | $720 | $520 | $460 | $400 | $3,250 |
| North Carolina | $1,150 | $690 | $520 | $420 | $370 | $3,150 |
| National Average | $1,400 | $750 | $550 | $450 | $400 | $3,550 |
| Colorado | $1,500 | $720 | $560 | $440 | $350 | $3,570 |
| Virginia | $1,450 | $740 | $550 | $460 | $380 | $3,580 |
| Washington | $1,650 | $710 | $580 | $430 | $340 | $3,710 |
| New York | $2,000 | $780 | $620 | $500 | $420 | $4,320 |
| California | $2,200 | $760 | $640 | $480 | $380 | $4,460 |
| Hawaii | $2,500 | $720 | $700 | $450 | $450 | $4,820 |
A retired couple can live on $33,600/year in Mississippi versus $57,840/year in Hawaii — a 72% difference.
Housing is the single biggest variable. In Mississippi, a retired couple can find a comfortable home for $900/month, while the same quality of housing in Hawaii costs $2,500 — almost three times more. If you’re asking “can I retire with $1 million?” the answer depends heavily on where you live. A million dollars using the 4% rule generates $40,000/year — comfortable in Tennessee or Georgia, but tight in California or New York.
For retirees on a fixed income from Social Security alone (the average benefit is roughly $1,900/month for individuals), the Southeast and Midwest offer the most breathing room. States like Mississippi, Arkansas, and Alabama allow a couple receiving combined benefits of $3,500-$4,000/month to cover basic expenses without dipping into savings.
Healthcare Access for Retirees
Healthcare is one of the most critical — and most expensive — factors in retirement planning. The average retiree spends a significant portion of their budget on healthcare, even with Medicare coverage. Quality and availability of care varies widely by state, and choosing a state with fewer doctors per capita or limited hospital access can have real consequences as you age.
| State | Doctors per 100K | Medicare Advantage Penetration | Avg Medigap Premium (Plan G) | Healthcare Ranking |
|---|---|---|---|---|
| Massachusetts | 450 | 28% | $165/month | #1 |
| Hawaii | 370 | 42% | $145/month | #2 |
| Minnesota | 340 | 55% | $135/month | #3 |
| Vermont | 385 | 18% | $160/month | #4 |
| Colorado | 330 | 40% | $140/month | #5 |
| Florida | 280 | 52% | $125/month | #15 |
| Tennessee | 270 | 48% | $120/month | #25 |
| Georgia | 250 | 45% | $130/month | #30 |
| Texas | 225 | 44% | $135/month | #35 |
| Mississippi | 185 | 32% | $115/month | #50 |
Some of the most tax-friendly states rank lower in healthcare quality. Florida strikes a reasonable balance.
There’s an unfortunate inverse relationship at play: many of the most affordable, tax-friendly retirement states rank lowest for healthcare access. Mississippi (ranked #50) has just 185 doctors per 100,000 residents — less than half of Massachusetts (#1 at 450). Alabama, another affordable option, also ranks in the bottom tier. Florida threads the needle reasonably well — it ranks #15 for healthcare while offering zero income tax, which is a major reason it tops our overall list.
If healthcare is your top priority — particularly if you have chronic conditions or anticipate needing specialized care — states like Massachusetts, Minnesota, and Colorado offer excellent healthcare systems, though at a higher cost of living. For a deeper look at healthcare costs and coverage options in retirement, see our Medicare guide and early retirement healthcare article.
Climate Comparison
Climate matters more in retirement than during your working years, simply because you’ll spend more time at home and outdoors. Extreme heat, severe cold, and natural disaster risk all affect quality of life and can impact your budget through higher insurance premiums (Florida’s homeowner’s insurance averages more than twice the national average due to hurricane risk) and utility costs.
| State | Avg Winter Low (°F) | Avg Summer High (°F) | Sunny Days/Year | Natural Disaster Risk |
|---|---|---|---|---|
| Florida | 50-60 | 90-92 | 237 | High (hurricanes) |
| Arizona | 35-45 | 104-107 | 299 | Low |
| South Carolina | 35-42 | 90-93 | 215 | Moderate (hurricanes) |
| Tennessee | 28-35 | 88-92 | 204 | Moderate (tornadoes) |
| Nevada | 28-35 | 100-106 | 294 | Low |
| Texas | 35-45 | 94-100 | 234 | Moderate (hurricanes, tornadoes) |
| North Carolina | 30-38 | 86-90 | 213 | Moderate (hurricanes) |
| Georgia | 33-40 | 90-93 | 217 | Low-Moderate |
| Wyoming | 10-18 | 82-88 | 206 | Low |
| South Dakota | 5-12 | 85-90 | 200 | Moderate (blizzards) |
Arizona leads with 299 sunny days per year, making it the top destination for retirees who want consistent sunshine and a dry climate — ideal for those with arthritis or respiratory conditions. However, summer temperatures regularly exceed 104°F in Phoenix and Tucson, which means high air conditioning costs from May through September and limited outdoor activity during peak heat.
Florida and South Carolina offer mild winters and beach access but come with meaningful hurricane risk. Homeowner’s insurance in coastal Florida can cost $3,000-$6,000+ per year, which offsets some of the tax savings. Tennessee and North Carolina offer a middle ground — mild winters, four seasons, lower natural disaster risk, and moderate humidity.
Wyoming and South Dakota rank well for taxes and cost of living but have harsh winters with temperatures regularly dropping below 10°F, which limits their appeal for retirees who prioritize warm weather.
Best States by Retirement Priority
Every retiree has different priorities. Some want to minimize taxes above all else, others need to stretch a modest budget, and some prioritize access to world-class healthcare or sunshine. Here are the top five states for each common retirement priority.
Lowest Taxes
Wyoming leads on total tax burden — combining no income tax with a 0.55% effective property tax rate and a 4% sales tax. Nevada and Tennessee are close behind. All five of these states have no income tax, so every dollar of pension, Social Security, and IRA income is untouched by state taxation.
- Wyoming
- Nevada
- Tennessee
- Florida
- South Dakota
Lowest Cost of Living
A retired couple can live on $33,600–$35,000/year in any of these five states — well within the income a typical two-earner household receives from Social Security alone. Mississippi has the lowest median home values in the country (~$145,000), making it especially accessible for retirees without large nest eggs. The trade-off is lower-ranked healthcare access in most of these states.
- Mississippi
- Arkansas
- Oklahoma
- Alabama
- West Virginia
Best Healthcare
These states have the highest physician-to-resident ratios, strongest hospital quality scores, and most robust Medicare Advantage networks. Massachusetts leads nationally with 450 physicians per 100,000 residents. All five are notably more expensive than the tax-friendly states, but for retirees managing chronic conditions or those who want access to top specialists, the healthcare infrastructure difference is substantial.
- Massachusetts
- Hawaii
- Minnesota
- Vermont
- Colorado
Best Climate (Warm Weather)
Arizona averages 299 sunny days per year — the most of any state — with low humidity and minimal hurricane risk. Florida offers 237 sunny days with beach access on both coasts. Note that both states have significant summer heat trade-offs: Arizona regularly exceeds 105°F in July, and Florida’s hurricane season runs June through November with substantial homeowner’s insurance implications.
- Florida
- Arizona
- South Carolina
- Hawaii
- California
Best Overall Balance
These states optimize across all four categories — taxes, cost of living, healthcare, and climate — rather than excelling in only one. Florida is the most complete package for retirees who want warm weather; Tennessee is the best value for those who don’t mind four seasons. South Carolina is the overlooked gem: favorable income tax treatment on retirement income, beach and mountain access within a few hours’ drive, and a cost of living well below the national average.
- Florida — No income tax, warm climate, good healthcare, moderate cost of living
- Tennessee — No income tax, very affordable, four seasons, growing economy
- South Carolina — Favorable taxes, low cost of living, beach access, mild winters
- Georgia — Affordable, major airports (Atlanta), good healthcare, mild climate
- Arizona — Low taxes, sunshine, active retirement communities, dry climate
For retirees who want to explore specific cities and communities rather than just states, see our guide to the best places to retire, which ranks individual metro areas based on similar criteria.
Worst States for Retirees (by Taxes)
Just as some states roll out the red carpet for retirees, others make retirement significantly more expensive through a combination of high income taxes, steep property taxes, and elevated costs of living. If you’re currently living in one of these states, it’s worth calculating how much you could save by relocating — even a move to a neighboring state can make a meaningful difference.
| Rank | State | Why It’s Expensive |
|---|---|---|
| 1 | New York | High income tax + property tax + cost of living |
| 2 | California | High income tax on all retirement income + extreme cost of living |
| 3 | Connecticut | Taxes Social Security + high property tax + high cost of living |
| 4 | Minnesota | Taxes Social Security + cold winters + moderate cost of living |
| 5 | Vermont | Taxes Social Security + high property tax + cold climate |
Connecticut and Minnesota are particularly punishing for retirees because they’re among the few states that tax Social Security benefits at the state level — on top of the federal taxation that already applies to most retirees. California taxes all retirement income (pensions, 401(k), IRA withdrawals) at the same rates as regular income, with a top marginal rate of 13.3%. New York combines high income taxes with some of the highest property taxes in the country, making it the most expensive overall state for retirees.
How Much You Can Save by Relocating
The financial case for relocating in retirement can be compelling — especially if you’re moving from a high-tax, high-cost state to one that’s more retirement-friendly. The table below shows estimated annual tax savings for common relocation routes, along with the potential 20-year value of investing those savings at a 5% annual return.
Moving from a high-tax state to a retirement-friendly state:
| Move | Annual Tax Savings | 20-Year Savings (invested at 5%) |
|---|---|---|
| New York → Florida | $4,000-8,000 | $132,000-264,000 |
| California → Tennessee | $3,500-7,000 | $116,000-231,000 |
| Connecticut → South Carolina | $3,000-6,000 | $99,000-198,000 |
| Minnesota → Arizona | $2,500-5,000 | $83,000-165,000 |
| New Jersey → Delaware | $2,000-4,000 | $66,000-132,000 |
A couple saving $6,000/year in taxes over a 20-year retirement, invested at 5%, accumulates $198,000+.
These numbers reflect only tax savings — they don’t account for the additional savings from a lower cost of living. A couple moving from New York City to Knoxville, Tennessee, could see their total annual expenses drop by $15,000-$25,000 when you factor in cheaper housing, groceries, and everyday costs on top of the tax savings.
Of course, relocation involves real tradeoffs. Moving away from family, friends, and familiar community ties has a cost that doesn’t show up in any spreadsheet. Many retirees split the difference by maintaining their existing home and spending winters in a tax-friendly state, though you typically need to establish legal residency (usually spending 183+ days per year in the new state) to claim the tax benefits.
For help figuring out whether your current savings support retirement — in any state — try our retirement savings calculator or explore scenarios like “can I retire with $1 million?”
Key Takeaways
- No-income-tax states (FL, TN, TX, NV, WY, SD, AK, NH, WA) save retirees thousands in annual taxes
- Total tax burden includes income, sales, and property tax — no-income-tax states may make up revenue elsewhere (Texas: high property tax)
- Wyoming, Nevada, and Tennessee have the lowest total state tax burden for retirees
- Mississippi and Arkansas are the most affordable states to retire in overall
- Florida offers the best balance of no income tax, warm climate, and reasonable healthcare
- Relocating can save $66,000-264,000 over a 20-year retirement when tax savings are invested
- Healthcare quality varies widely — some of the most affordable states rank lowest for healthcare access
For a full 2026 ranking, see best states to retire in 2026 and best states to retire for taxes. Return to the Best Places to Retire hub.
The content on Wealthvieu is for informational purposes only and should not be considered financial, tax, or investment advice. Consult a qualified professional before making financial decisions. Full disclaimer · Editorial policy