What It Costs To Retire in Every U.S. State

From the day you started working, you’ve probably dreamed about retirement: where you’ll live, how you’ll spend your days, and who you’ll spend them with. But before you start pondering whether you’d prefer a beach town or a mountain escape, there’s one practical — and far less romantic — question to answer: Where can you actually afford to retire?

A new report from Investopedia analyzed federal data to estimate how much a typical retired couple would spend in every U.S. state plus Washington, D.C., as well as the size of the nest egg needed to support that lifestyle. The differences are striking, with retirement costs varying by hundreds of thousands of dollars depending on location.

What the Report Says

The analysis concluded that the typical couple age 65 or older needs a nest egg of about $1.16 million to retire comfortably in the U.S. — which they equate to spending $84,000 a year — compared with the $898,000 a single retiree (around $60,000 a year) would require. That number jumps if the couple is dreaming of living out their golden years in Hawaii, where they’ll need $1,326,000 in the bank. That’s only slightly less than in New Jersey, the most expensive state on the list, where retirees would need roughly $1,329,000. California and Washington, D.C., are the next most expensive places to call home, with retirees needing roughly $1.32 million. 

The East Coast dominates much of the rest of the top 10, with New York, Massachusetts, Connecticut, and Maryland joining Washington state on the list, each requiring nest eggs in the $1.2 million range.

If cost is your most important consideration, you may want to consider the Plains or Appalachia. North Dakota is the most affordable state to retire in, with a couple needing about $800,000 in savings. Arkansas ($807,000), Mississippi ($813,000), West Virginia ($821,000), and Iowa ($834,000) round out the five least expensive places to retire.

The Cost of Retirement in Each State 

Alabama: $862,000

Alaska: $1,098,000

Arizona: $1,039,000

Arkansas: $807,000

California: $1,324,000

Colorado: $1,130,000

Connecticut: $1,206,000

Delaware: $1,031,000

Florida: $1,103,000

Georgia: $969,000

Hawaii: $1,326,000

Idaho: $929,000

Illinois: $1,072,000

Indiana: $896,000

Iowa: $834,000

Kansas: $884,000

Kentucky: $847,000

Louisiana: $837,000

Maine: $1,001,000

Maryland: $1,203,000

Massachusetts: $1,213,000

Michigan: $946,000

Minnesota: $1,046,000

Mississippi: $813,000

Missouri: $886,000

Montana: $935,000

Nebraska: $887,000

Nevada: $1,087,000

New Hampshire: $1,185,000

New Jersey: $1,329,000

New Mexico: $895,000

New York: $1,231,000

North Carolina: $939,000

North Dakota: $800,000

Ohio: $915,000

Oklahoma: $848,000

Oregon: $1,134,000

Pennsylvania: $980,000

Rhode Island: $1,119,000

South Carolina: $921,000

South Dakota: $845,000

Tennessee: $857,000

Texas: $988,000

Utah: $1,027,000

Vermont: $1,063,000

Virginia: $1,081,000

Washington: $1,217,000

Washington, D.C.: $1,320,000

West Virginia: $821,000

Wisconsin: $952,000

Wyoming: $926,000

How the Numbers Were Calculated

The gap between the most and least expensive states underscores just how much geography can shape your retirement finances. A couple retiring in Hawaii or New Jersey would need more than $500,000 in additional savings compared with a couple settling in North Dakota, according to the analysis. 

While housing costs play a major role (they account for around 27% of a retired couple’s expenses), they’re far from the only factor. The report looked at typical household spending using federal consumer expenditure data, taking into account everyday expenses such as groceries, utilities, and health care, as well as discretionary spending, including travel and entertainment. After determining what the typical couple would get in Social Security benefits, Investopedia then estimated how much they would need to cover the rest of their costs over their retirement. The calculations also took into account the 4% rule, a retirement guideline that suggests retirees withdraw 4% of their retirement account in their first year and then adjust annually based on inflation.

Those figures, of course, are only estimates, as no two retirements look exactly alike. Whether you’ve paid off your home, how often you travel, your health care needs, and the lifestyle you hope to maintain can all dramatically affect how much you’ll ultimately need to save. State taxes, insurance costs, and the local cost of living can also make one destination considerably more affordable than another. 

The report serves as a reminder that retirement planning isn’t just about deciding at what age to stop working — it’s also about figuring out where your savings will go the furthest. If you’re still years away from retirement, factoring your ideal destination into your savings goals now could help you avoid an expensive surprise later. And if you’re flexible about where you’ll put down roots, relocating to a lower-cost state could stretch your nest egg significantly further. 

For many Americans, the biggest retirement decision may not be when to stop working, but where to spend the years that come after.

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