Even if you plan to stay in your current location when you retire, there’s a lot to consider. Can you afford it on a fixed income? Are there enough activities and opportunities to keep you happy and purposeful after you leave the workforce? Will the healthcare be good enough and available enough as you age?
It’s also highly unlikely things will get less expensive as the years go by. Rents or property taxes will rise, the cost of health care has been on an upward trajectory for decades, and thanks to inflation, prices of most everything else continue to rise.
While a commonly-used rule of thumb for spending in retirement is to plan to spend 80% of what you earn at work, one of the the biggest mistakes that people make when planning their retirements is assuming they’ll be spending less, says Paul Klontz, an associate professor of practice of financial psychology and behavioral finance at the Heider College of Business at Creighton University. Klontz recommends you should plan for 100% of that income, plus an average of 3% cost of living increase each year.
“I am not sure what the direct connection is between Covid and retiring, but the average American is grossly, financially underprepared for retirement,” Klontz says.
“Retirement age folks were reminded of the vulnerability of physical distance between where they are living and their families, relatives, especially children and grandchildren, and are making decisions to close that gap by moving,” Klontz says.
So whether you move or stay, money is key, but other things matter too.
To find the best places in the U.S. to retire, WalletHub compared the retirement-friendliness of 182 cities — including the 150 most populated U.S. cities, plus at least two of the most populated cities in each state — across four key dimensions:
- Affordability, which includes cost of living, taxes, and cost of in-home services and adult day health care,
- Activities, which considers the number of recreation and senior centers, and opportunities for other activities such as golf, museums, theater, art galleries, music venues and volunteer opportunities,
- Quality of life, which includes the share of population that is over 65, age-friendliness, employment, walk score, access to transit, mild weather, the number of seniors living alone or in poverty, crime figures and air and water quality.
- Healthcare—This includes Covid rates and vaccination rates, number of doctors, dentists, nurses and health care facilities, as well as life expectancy and death rates of elders.
The most affordable of the 182 cities is Fort Smith, Ark., the least affordable is New York. The No. 1 city for activities is Washington, D.C., while West Valley City, Utah, ranks worst. The city ranking highest for best quality of life is Fremont, Calif., while Springfield, Mo. ranks the lowest. Lastly, for healthcare, Burlington, Vt., comes out on top, while North Las Vegas is at the bottom. None of these cities makes the top 30 overall, although Washington D.C. ranks No. 32.
Orlando, Fla. ranks at the top of WalletHub’s list of best places to retire. It ranks high for affordability and activities, and No. 70 and 68 for quality of life and healthcare, respectively.
Florida may bring to mind frequent hurricanes, but the centrally-located city of Orlando is actually one of the safest cities in the state in this regard, according to the Palm Beach Post. Walt Disney World (DIS) – Get Walt Disney Company Report has closed for hurricanes six times since 1999, sometimes only for a partial day, according to one vacation site.
With cost being a significant factor in retirement, WalletHub’s analysis assumes retirees will rely on a fixed income. The lower their expenses, the better retirees will fare in a particular city.
Based on their ranking, these are the best cities to retire in America: