Best States to Retire in 2014

May 15, 2014
Laura Joszt

Don't head to the warm coasts for the best retirement spots, head inland. Instead of considering traditional retirement locations like Florida, look to the Dakotas.

Don’t head to the warm coasts for the best retirement spots, head inland. Instead of considering traditional retirement locations like Florida, look to the Dakotas, according to the report from Bankrate.com.

In Bankrate’s annual ranking of the best and worst states to retire, Florida and Arizona don’t even make the top 10.

The ranking weighs several factors: weather, cost of living, crime rate, healthcare quality, tax burden, and well-being (as measured by the Gallup-Healthways Well-Being Index).

Chris Kahn, research and statistics analyst at Bankrate, admitted the high ranking states are not what many retirees think would be a good place to retire. Typically, warm, sunny, beach states are retirement havens, but many of the best states to retire are not ranked for their weather, but for factors like healthcare quality and low taxes.

"Of course, the best place to retire will differ drastically depending on the individual," Kahn said in a statement. "For some, the best place to retire is simply anywhere there's year-round warmth and sunshine. For others, it's where family and friends live. Retirees are best off deciding what factors matter most to them and checking the relevant statistics before making a final decision."

Coastal states, like New York and Maryland, were among the worst states to retire in, as was beautiful Hawaii because of its high cost of living. Only one state on the east coast and no west coast states made the top 10 best states to retire in.

Bankrate used cost of living stats from the Council for Community and Economic Research, healthcare quality stats from the US Department of Health and Human Services’ Agency for Healthcare Quality and Research, state tax rates from the Tax Foundation, crime rates from the FBI, and weather statistics from the National Oceanic and Atmospheric Administration.

(Tax burden is a percent of state income and the cost-of-living score of 100 is the national average).

10. Virginia

Cost of living: 96.4

Tax burden: 9.2%

Average annual sunshine: 60.7%

Charlottesville

The loan coastal state to make the list, Virginia taxes residents at a lower rate and has a below-average cost of living. The state also received better-than-average scores for healthcare quality, weather, and personal wellness.

The city of Charlottesville has a high ratio of primary care physicians to residents and consumers spend 71% less than the national average for healthcare.

9. Iowa

Cost of living: 92.4

Tax burden: 9.3%

Average annual sunshine: 60%

Des Moines

The top income rate for Iowa isn’t great, but with 9 different tax rates, retirees will likely fall under a lower rate. Plus, Iowa’s cost of living is below average for the nation and the state has one of the better healthcare systems in the country.

Iowa City was named the city with the most affordable healthcare, recently, too, according to Livability.com. There are 14 hospitals serving the area and consumers spend 17% less on healthcare than the rest of the country.

8. Idaho

Cost of living: 90.6

Tax burden: 9.5%

Average annual sunshine: 64%

Boise

Not only is Idaho one of the most affordable states in the country, it is also one of the safest, according to the data Bankrate compiled. The state has the lowest crime rate in the country and Boise was named the seventh safest city.

Winters can get cold, but Boise gets more sunshine than Atlanta and the annual humidity is just 58%.

7. Montana

Cost of living: 98.8

Tax burden: 8.6%

Average annual sunshine: 58.8%

Ski resort in Big Sky

If you’re looking for the traditional idea of a retirement spot, Montana might not be the best choice since the state doesn’t have beaches or year-round sun. However, the low tax rate, good healthcare system, and below-average crime rate might be just what some people are looking for when they retire.

6. Nebraska

Cost of living: 90.2

Tax burden: 9.4%

Average annual sunshine: 63.3%

Omaha

The people living in Nebraska feel really good about living there. According to the Gallup-Healthways survey, residents consistently feel they have a good quality of life. Plus, the cost of living is low (the lowest in the top 10), which means your money will go farther.

There are 30 hospitals serving Lincoln, which keeps medical expenses low.

5. Wyoming

Cost of living: 97.2

Tax burden: 6.9%

Average annual sunshine: 65.7%

Jackson

With the lowest taxes in the country, retirees will feel pretty good living in Wyoming, especially since the crime rate is relatively low. Although, the state gets cold weather, Lander, WY, actually gets more sunshine than Tampa, FL, according to Bankrate.

4. North Dakota

Cost of living: 100.8

Tax burden: 8.8%

Average annual sunshine: 58.7%

Grand Forks

Both Dakotas made the top 10, actually. If you can stand weather below zero in the winter, then you’ll enjoy low taxes and quality healthcare, although cost of living is on par with the national average. Residents of North Dakota seem to love the state despite its difficult winters: it received the highest scores on the Gallup-Healthways Well-Being Index, and residents are generally happier than their peers.

3. Utah

Cost of living: 92.6%

Tax burden: 9.4%

Average annual sunshine: 68%

Canyonlands National Park near Moab

At the very least, retirees will get that sunny weather if they move to Utah. Plus, it’s a good location for those who want to stay active thanks to the country’s best skiing and national parks such as Bryce Canyon and Zion.

Utah also did well when it comes to healthcare quality, cost of living, and Well-Being Index ranking.

2. Colorado

Cost of living: 98.8

Tax burden: 9%

Average annual sunshine: 72%

Pueblo

The state does get a lot of snow in the winter, but that just means skiing is fantastic. According to Bankrate, Colorado has similar strengths to Utah, but is just slightly better. And if you don’t enjoy hot weather, Colorado’s mild summers will appeal to you even while still providing plenty of sunshine.

1. South Dakota

Cost of living: 99.2

Tax burden: 7.1%

Average annual sunshine: 63%

Sioux Falls

While North Dakota had the best wellness scores, South Dakota came in second. The winters may be cold and snowy, but living in South Dakota won’t burden your savings account thanks to a relatively low cost of living and low taxes. Plus, it has one of the lowest crime rates.