Key Points
Moving to a state with a lower cost of living can help you stretch your dollars further.
There are other factors worth considering when deciding where to live in retirement.
If you plan to move in retirement, give your new home a trial run first.
- The $23,760 Social Security bonus most retirees completely overlook ›
When you're worried you won't have enough money for retirement, there are two ways to handle the situation: You can increase your savings, or you can reduce your costs. Many people want to save more, but they struggle because of high living costs today.
Reducing your retirement costs can also seem difficult if you plan to remain in your current home. But if you're willing to move to one of the following 10 states, your dollars could go a lot further.
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The 10 states with the lowest cost of living
The following 10 states have the lowest cost of living, according to The Motley Fool's analysis of the Economic Policy Institute's Family Budget Calculator:
- Arkansas
- Indiana
- Ohio
- Kentucky
- Texas
- Pennsylvania
- South Carolina
- Tennessee
- Washington
- Michigan
Obviously, there's a lot of variance within each state. If you currently live in a rural area, retiring in downtown Seattle is probably going to cost you more than what you're paying now. However, these states also have some affordable areas if you move away from the big cities.
Cost isn't the only retirement factor worth considering
The Motley Fool's Best States to Retire to in 2026 study looked at what retirees value most in their retirement destinations, and its top 10 looks quite different from the list above. The 10 best states for retirement are:
- Florida
- California
- Texas
- Michigan
- Wisconsin
- Ohio
- Pennsylvania
- Minnesota
- Washington
- Georgia
There's some overlap here, but several states make the list despite having a higher cost of living. That's because cost isn't the only factor most seniors consider when deciding where to live.
You also have to take into account factors like weather, healthcare, retirement taxes, crime, and the activities available within the state. Only you can decide how important each of these factors is to you, but it's important to think through them all before making your decision.
If you decide to retire in another state, it's worth doing a test run in advance. Rent a place and stay there, ideally for a few weeks in different seasons, so you can get a feel for what it's like. While you're there, check out the neighborhoods and the activities going on there so you can see whether they're a good fit for you. You may also want to speak to a tax professional who lives in the area to get a sense of how your move might affect your tax bill.
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