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Where Are the Cheapest Places to Retire? Consider These 5 U.S. States

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Feb. 11 2022, Published 10:52 a.m. ET

Planning for retirement is an important aspect of adult life. Finding an affordable place to retire is equally important. With so many options in the U.S., what are the cheapest places to retire with a high quality of living?

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From the cost of living to the median home value, several factors go into a place being considered an affordable retirement location. Here's a list of five states that offer affordable and comfortable retirement.

1. Florida

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It isn't a surprise that Florida is a popular destination for retirees. The warm weather and beach access make it a desirable place for people looking to slow down.

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Some of the most popular cities for retirees in the state include:

  • Sarasota was named the best place to retire in the United States in 2021 and 2022 by U.S. News and World Reports.
  • Daytona Beach's an affordable option when it comes to retirement as the median mortgage is $1,220 a month.
  • Lakeland is centrally located in Florida and according to MoneyWise, the median home value is $195,914.

The biggest selling point for retiring in Florida: no state income tax.

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2. Arizona

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In 2021, Arizona was named “Most Tax-Friendly” by Kiplinger. Social security benefits from state income taxes are exempt, military retirement is tax-free as well.

In 2022, Arizona will be implementing a two-bracket tax rate system. For joint filers with taxable income up to $54,544 ($27,272 for single filers), the rate will be 2.55 percent. For those with income over $54,544 jointly and over $27,272 single, the rate is 2.98 percent.

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So, what cities are the best for retirees? According to Forbes, Green Valley offers a palatable financial situation for those looking to retire. The median home price is 24 percent below the national average at $189,000, followed by the cost of living being 3 percent below the average.

There's also Sun City with a median home price of $180,000, which is 28 percent below the national average. Although the cost of living is three percent above the national average, there is no state income tax on social security.

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3. Texas

cheapest places retire texas
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Just like Florida, there is no state income tax in Texas, which means that Social Security retirement benefits and all other types of retirement income are tax-free.

Options in The Lone Star State include El Paso, where the average rent is $789 a month, and a mortgage of $1,172 a month.

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Near the water, there's Corpus Christi the average mortgage is $1,388 followed by a median rent of $940. Plus, places like Laguna Madre give retirees access to see marine wildlife being released back into the ocean.

And don't forget about San Antonio, where seniors make up 11.6 percent of the population.

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4. South Carolina

cheapest places retire south carolina
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South Carolina does not tax Social Security retirement benefits making it ideal for retirees.

Plus, the median household income in Charleston is $64,000 and has an average home value of $357,744.

Retirees can expect warm weather, rich nightlife, and access to the beach. Summerville is 14 miles from Charleston and provides small-town living with access to lively nightlife and the median home value is near $252,200.

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5. Ohio

cheapest places retire ohio
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While social security is also not taxed in Ohio, withdrawals from retirement accounts are fully taxed.

However, cities like Cleveland are affordable, with a median home value of $55,300. The median mortgage and rent rates are $1,327 and $779, respectively.

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Toledo also has a livability score of 62 and seniors account for 13.7 percent of the population. The town has a median home value of $69,100. Its high rate of seniors in the population makes it desirable for retirees seeking to be surrounded by other retirees.

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