15 Places Retirees Are Picking Over Florida (#4 Is a Clever Option)

Florida may be at the top of your list of states you’re considering for retirement, but there may be better options than the Sunshine State.

Some states may have more affordable taxes even though Florida doesn’t have a state income tax. Others could have nice weather or more affordable housing that could help you maximize your retirement savings .

So before you pack up and move to Florida, take a look at these states and see if one of them is a better retirement home for you.

1. Delaware

Ideally situated between New York City and Washington, D.C., Delaware offers a calm lifestyle but easy access to big cities. In its 90 miles, you can live at the beach in the south or in the rolling hills of the northern part of the state.

Delaware is considered a tax-friendly state for retirees as Social Security is not taxed, while retirement funds and pensions are only partially taxed.

2. Arizona

If you want to live somewhere warm, think about Arizona as an alternative to Florida. You'll have to trade the beach for a warm desert, though.

Arizona, like Florida, has plenty of 55+ communities that cater to retirees, and 18.5% of the state’s population is over the age of 65. That puts it in the top 15 states with the highest 65-and-up populations.

3. Iowa

You may be surprised to see Iowa on the list, especially considering the weather is not the same as Florida. But there could be some advantages to living in the Midwest state.

Iowa ranked in the top 10 lowest cost-of-living states in 2023, which could be important when you’re living on a fixed income.

That lower cost of living includes housing with a median sale price of $241,500 for all homes in Iowa in June compared to $419,500 for the same time in Florida.

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4. Virginia

Some retirees are flocking to North Carolina as an alternative to Florida only to be surprised by the taxes they have to pay on their retirement income.

Instead, head a little farther north to Virginia, which is more tax-friendly for retirees. The state doesn’t tax your Social Security and only partially taxes income from retirement accounts or your pension.

5. Pennsylvania

Pennsylvania ranks in the top 10 when it comes to states with the highest percentage of residents over the age of 65, with 19.1% of residents falling into that category.

One reason older residents may stick around is the state’s friendliness when it comes to retirement taxes. Pennsylvania doesn’t tax Social Security, retirement account withdrawals, or income from pensions.

6. Missouri

Missouri has a lower cost of living index compared to Florida, coming at 88.5. Florida’s cost of living index is 100.7.

One factor that lowers the cost of living in Missouri is housing. The median sale price for a home in the state was $282,200 in June compared to Florida’s $419,500 for the same month.

7. Georgia

Check out Georgia as an option if you want to get close to Florida without crossing the state line.

Georgia, like Florida, is a tax-friendly state for retirees with no taxes on Social Security and only partial taxes on retirement account income and pensions.

The state also has a lower cost of living index at 90.8 compared to Florida’s 100.7, which can be a motivator if you’re living on a fixed income.

8. Wyoming

Wyoming has a low cost of living, with a cost of living index of 92.4, which is less than the cost of living in Florida.

The state is also very tax-friendly for retirees. Wyoming, like Florida, doesn’t have a state income tax. It’s also tax-friendly specifically for retirees with zero taxes on Social Security, pensions, and income from retirement accounts.

9. Michigan

Michigan may not be a good option if you’re seeking year-round warmth, but there are other factors to consider if you want to retire there.

The state is friendly to retirees with no tax on Social Security and only partial tax on pensions and retirement account income.

It also ranks in the top 10 for most affordable states with a cost of living index at 90.6 compared to Florida’s 100.7.

10. Mississippi

Another state that has beaches and warm weather without being Florida is Mississippi.

The state can work for retirees who are looking for low taxes as Mississippi doesn’t tax Social Security, retirement account income, or pensions.

The state also had a median sale price of $243,400 for homes in June compared to Florida’s $419,500.

11. Nebraska

Nebraska can be a great choice if you’re trying to save money on a fixed income.

The state’s cost of living index comes in at 90.9, which is lower than 100.7 as a cost of living index in Florida.

One of the factors that keeps the cost of living index low in the state is housing costs. The median sale price for homes in Nebraska was $286,000 in June compared to $419,500 in Florida.

12. Nevada

Nevada is a very tax-friendly state for retirees who are worried about taxes while on a fixed income.

The state has no state income tax and doesn’t tax Social Security, retirement accounts, or pensions.

13. West Virginia

West Virginia ranks third among states with the largest percentage of the population over the age of 65; 20.9% of its population is over that age. That’s a good point if you want to live around others close to your age.

It’s also affordable, with the fourth-lowest cost of living in the country, an index of 87.7, which is below Florida’s 100.7.

14. Alabama

Right below West Virginia in the cost of living index is Alabama with an index of 88.3, making it an affordable choice for some retirees.

The state is also somewhat friendly when it comes to taxing retirees. You will get fully taxed on your retirement account withdrawals, but the state doesn’t tax Social Security or pensions.

15. South Carolina

South Carolina could be another option if you want to live somewhere near the water in the south without going all the way to Florida.

The state has a friendly tax policy for retirees with no tax on Social Security and only a partial tax on retirement account withdrawal and pensions.

Housing in South Carolina is also more affordable with a median sale price of $390,200 in June compared to $419,500 in Florida.

Bottom line

Florida may be a good destination if you retire early and want to live in a climate that is warm year-round, but there may be other considerations.

In addition to knowing how much you'll spend annually as a retiree, you also want to consider the location of your new home. Is it close to airports? How are its medical facilities? Will you find a community of like-minded people?

As you research where you will spend your next act, you should consider working with a financial advisor. They will run what-if scenarios based on your current retirement savings and other investments to see if you can afford the lifestyle you want. Having that information may help you decide where you want to live.

Money tips that can work for everyone

No matter what your bank account balance is, there's always an opportunity to optimize and improve your finances. Here's a quick checklist of things you can look at today.

Focus on paying off your debt . Debt can hold you back from making progress with your overall financial well-being. Aside from cutting expenses, there are tools that can help you pay off debt faster like balance transfer credit cards and debt counseling.

Earning extra income can give you breathing room. If finances are tight, earning some extra money to supplement your income can make a huge difference. A new job is one option to consider, but if you're not ready to make a big change or already retired, a part-time side job could be a better choice.

Cut your expenses. It sounds painful and so not fun, but it doesn't have to be. Take a look at your biggest expenses because that's where you'll probably find the biggest savings. For example, auto insurance rates have been soaring so shopping around for a new insurance company can be the fastest way to cut your bill. Also, look for ways to cut your grocery bill (despite rising inflation).