Anonymous deleted answer August 9, 2018
There are a couple factors you need to keep in mind when considering which states are the cheapest to retire in. Not only do you need to determine which states are the most tax friendly, but also consider which states have the lowest cost of living. Let’s examine both of these factors.
Most people think about taxes when they are getting ready to retire. As a retiree you need to think about tax categories such as: most pension friendly, no tax on Social Security benefits, no sales tax, no state income tax, most tax friendly, and lowest median real estate taxes.
Your overall tax burden will vary greatly from state to state and any low or no tax state could change at some point. Your federal tax obligations will stay the same no matter what, so you really only need to consider state taxes to determine which states are the cheapest to retire in. When examining which states are the most tax friendly according to the above listed categories these states seem to be best: Alaska, Mississippi, Alabama, Louisiana, New Hampshire, and Tennessee.
However, just because a state is tax friendly, does not mean that it is the cheapest to retire in. You also must consider and compare the cost of living. The states with the lowest cost of living index starting with the lowest include Oklahoma, Kentucky, Arkansas, Georgia, Idaho, Indiana, and Mississippi. The five highest cost of living states from highest to lowest include New Jersey, Alaska, Maryland, Connecticut, and Massachusetts.
Based off of these combined considerations some of the cheapest states to retire in include:
Of these states Mississippi is can be deemed the cheapest state to retire in because it is pension friendly, has no tax on Social Security benefits, has one of the lowest median real estate taxes, and has very low cost of living. Alabama comes in as a close second. If you are looking for cheap states to retire in, the above listed are your best bets.
