5 best states to retire


When you’re ready to hang it up at work, where do you want to retire?

Are you a typical ‘snowbird’ — somebody who slugged and slushed it out in dreary Northern winters for most of your life…and now you’re ready for fun-in-the-sun kind of locales like Florida, California, Hawaii, Arizona or Texas?

Or maybe you already live somewhere in the Sun Belt and you’re going to do it in reverse. Your plan is to hightail it up north to some place cooler when the heat of the summer comes every year.

No matter what you aspire to, some states are definitely better than others when you’re looking for a place to retire!

Read more: 196 of the best and worst cities for retirement

Check out this list of the best states

USA TODAY recently came up with a list of the five best states to retire. Factors like tax code, availability of good doctors, plentiful amenities, low crime rates, flourishing public transit, robust health care infrastructure, low health care costs and miniscule costs of living weighed into compiling this list.

South Dakota

When it comes to quality and affordability of health care, Sioux Falls and Rapid City both rank above average.


This state allows a deduction of up to $41,110 for income from retirement accounts. You can tap a 401(k) or IRA without penalties starting at age 59½.


You’ll enjoy a combined state and local sales tax rate of just 5.83%, among the top 10 lowest nationwide. Plus, no state income tax and low crime!


Mature workers who still want to work part-time will have an easy time finding jobs in the state’s northern suburbs. And don’t forget about easy access to beaches, mountains and cities for the weekends!



If you don’t want to retire around a lot of old fuddy duddies, consider this state. Utah has the lowest median age of any state in the union at 29.2 years. Lots of youthful energy should keep you motivated even in retirement! But beware this state will tax any income from Social Security, so there are tradeoffs to be considered.

Want to retire early? Follow this advice!

Limit your student loans

Consider going to a local state university instead of a big name school.

Another smart money-saving move to make during your school years? Condense college down to three years instead of four (or five) by taking extra courses during summers, winter break, etc.

For more on the right way to do student loans if you have to, see our student loan section.

Save early and often

Most financial planners recommend you save 10% to 15% throughout your working lifetime to have a good solid retirement. Want to really increase the likelihood you’ll retire early? Clark often talks about how he lived on every other pay check when he was younger. By doing that, he had an effective savings rate of 50%!

Stay in your starter home

You may want to consider not ‘trading up’ in terms of housing. A lot of young retirees are still in the same 30-year-old fixer-upper that they started out in and where they raised their families.

For guidance getting the best deal on a home purchase, see our Homes & Real Estate section.

Seek out low-cost investments

A new study from BuyUpside.com shows that just a difference of 1% in annual fees can mean an $80,000 difference in retirement.

Here’s how the math works. Let’s say you invest $100,000 today with a 5% annual return and you pay 1% in annual fees. In 30 years, you would have $319,694.

Now let’s say you invest $100,000 today with a 5% annual return and you pay 2% in annual fees. In 30 years, you would have $196,439.


Paying what seems to be a measly 1% more in fees (2% instead of 1%) eats an $80,000 hole in your retirement plan! What seems inconsequential in the here and now actually has a huge effect on your future wealth.

Read more: How much to save each month to have $1 million in retirement

The steps one man took to retire at 33

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