Do you plan to "retire in place" and stay in your current area, or are you interested in retiring in a different state? In either case, you may want to consult an annual study by WalletHub if retirement is imminent.
The study ranked all 50 states using 41 statistical metrics that were weighted and grouped into three major categories important to retirees: affordability, quality of life, and healthcare. You may be surprised at some of the states in both the best and worst categories. Let's start with the top five.
1. Florida – You knew it had to be high on the list, didn't you? In terms of affordability, Florida came second, dropping from last year's first place and replaced by Alabama as the most affordable state. Florida also placed fifth in terms of quality of life, overcoming its 26th-ranked healthcare rating.
2. Colorado – Rising from last year's third place overall, Colorado ranked fourth in healthcare while its quality of life came in fourth place, Affordability in the Centennial State jumped from 26th place last year to seventeenth in 2020.
3. New Hampshire – Not typically thought of as a retirement destination, New Hampshire has decent rankings across the board (sixth in healthcare, fourth in quality of life and 27th in affordability).
4. Utah – Leaping into the top five retirement destinations from its sixth-place spot in 2019, Utah is the fifteenth most affordable state. It also placed seventeenth for healthcare, and eighteenth for quality of life.
5. Wyoming – Another new entry in the five best states to retire, Wyoming wins its spot by ranking well for affordability (eleventh). Its quality of life and healthcare are also above average (twelfth and 33rd, respectively).
The next five desirable retirement states are, in order, Delaware, Virginia (losing its fifth-place ranking from 2019), Wisconsin, Idaho, and Iowa. Minnesota missed the top ten despite having number one rankings in both quality of life and healthcare, due to a dismal affordability ranking (46th), coming in sixteenth place overall. Let the free Retirement Planner by MoneyTips help you calculate when you can retire without jeopardizing your lifestyle.
What about the five states with the worst rankings? In descending order, they are:
46. West Virginia – While the Mountain State ranks above average in affordability (nineteenth), its overall score is pulled down by poor quality of life (fortieth) and the worst healthcare in the country (fiftieth).
47. New Jersey – The Garden State is 23rd in healthcare and ranks below average in both quality of life and affordability at 31st and 48th, respectively.
48. Rhode Island – Healthcare dropped seven places to 25th from last year's ranking, while quality of life and affordability remain poor at 38th and 47th place, respectively.
49. New Mexico – The Land of Enchantment has low scores in every category, coming in 37th for affordability, 38th for healthcare, and 45th for quality of life.
50. Kentucky – Kentucky ranks 48th in healthcare, 46th in quality of life and only 32nd in affordability, earning the Bluegrass State WalletHub's least desirable retirement state ranking for the third year in a row.
Was your state not mentioned? Check the full study results for further details on your state's rankings and a breakdown of all the statistical metrics and weightings.
Of course, each state has areas that don't fit the rest of the state profile. Individual cities were ranked in a 2019 WalletHub study, with the inclusion of an "Activities" ranking – and, while the results are similar, some differences emerge at the local level. For example, Louisiana fares poorly in the state rankings, but New Orleans ranks high in the city rankings (probably because, as you might expect, New Orleans ranks high for activities).
While the study is a useful baseline, it doesn't mean everyone should converge on Florida or flee Kentucky in his or her retirement years. Find an area that makes you happy and gives you a fulfilling and healthy lifestyle – just know where the strong and weak points are in your chosen retirement state.
Remember that your credit score also influences how attractive a place may be to live. Some states are more tolerable than others for consumers with bad credit. You can check your credit score and read your credit report for free within minutes by joining MoneyTips.