Best and Worst States to Retire in 2025

In 2025, a record 4.2 million Americans will turn 65 and enter retirement age. While this phase of life is typically seen as a time of relaxation and enjoyment, seniors today are navigating an unprecedented set of challenges in a rapidly changing world. 

They are retiring at a time marked by economic uncertainty and inflation. A recent AARP study found 20% of adults ages 50+ have no retirement savings, and 61% are worried they will not have enough money to support themselves in retirement. 

Healthcare costs are also skyrocketing. The Centers for Medicare and Medicaid Services reported national health spending surged across the board in 2023 – the most recent year on record – including for Medicare (8.1%), Medicaid (7.9%), out of pocket costs (7.2%), hospitals (10.4%) and prescription drugs (11.4%). CMS projects that from 2023-32, average national health expenditures will grow 5.6%, which will outpace average GDP growth of 4.3%. 

On the flip side, the outlook for longer and happier lives is looking up as the influx of seniors means more vibrant, supportive and social communities than ever before. 

Life expectancy is rising again after a dip during the pandemic, and Americans who turn 65 can expect to live another 19.9 years. That may just be the tip of the iceberg as futurists and scientists explore how techological and other scientific breakthroughs will impact longevity. 

Scientists in the UK recently created an AI-based aging clock that predicts people’s health and lifespan by analyzing their blood, and Fortune even hosted a panel called: The 1,000-Year-Old Human: Will AI Make Death Optional?

 
When you combine longer lifespans with rising costs, it becomes more critical than ever to retire in a place that is affordable, has accessible healthcare, and offers a strong community and social life for seniors. 

Determining the Best and Worst States to Retire:

To help older adults evaluate the impact of location on the aging experience, Seniorly ranked the best and worst states to retire based on nine metrics spread across three categories: affordability, quality of life, and health care. 

The nine metrics include cost of living, income taxes, Supplemental Security payments, weather, entertainment options, availability of doctors, long-term care spending, the community of older adults, and overall health status.

The complete methodology is at the bottom.

Key Findings:

• Washington, D.C., is the best place to retire due to its high monthly Supplemental Security payment ($1,094) and spending on long-term care, as well as the availability of doctors and recreational opportunities. Montana, Wyoming, Alaska and Pennsylvania round out the top five.
• New Jersey is the worst state to retire because it is one of the least affordable states in the country, has mediocre access to arts and recreation and an unhealthy senior population (65% have three or more chronic conditions). Alabama, Kansas, Georgia and Oklahoma also were in the bottom five.
• Florida, typically known as a retiree’s paradise, was dragged down to No. 18 due to its poor showing in the health care category. The state’s Medicaid program spends very little on long-term care ($542 per senior) and has an unhealthy population (68% of older adults have three or more chronic conditions).
  

Best States

The nation’s capital came out on top, with top scores on the availability of doctors (769 per 10,000 older adults), long-term care spending through Medicaid ($12,993 per senior), and recreational opportunities such as golf courses, museums, theaters, and sports arenas (775 per 100,000 older adults). However, Washington, D.C., isn’t exactly cheap, with one of the highest costs of living and maximum personal income tax rates (10.75%) in the U.S.

The rest of the top 10 best states to retire consisted of New England states such as No. 7 Vermont, No. 9 Rhode Island, and No. 10 Maine, which boast high quality of life and health care, as well as Mountain West states like No. 2 Montana, No. 3 Wyoming, No. 6 South Dakota and No. 8 North Dakota, which have a high quality of life and are more affordable.

Notably, Wyoming, Alaska and South Dakota all have no personal income tax, while No. 5 Pennsylvania has the highest average Supplemental Security Income payment in the country ($1,240). However, it should be noted that none of the top 10 states score well when it comes to weather.

Worst States

New Jersey is the worst state to retire, driven by its high cost of living and income tax rate of 10.75% for top earners. It lands in the middle of the pack when it comes to the size of its older community (17.7%), its Supplemental Security Income payment ($660), and the availability of arts and recreational facilities (268 per 100,000 older adults).

Apart from New Jersey, No. 45 Massachusetts and No. 49 Kansas were the only non-Southern states to rank in the bottom 10. Massachusetts was brought down by its high costs – it is the least affordable state for seniors in the U.S. – while Kansas had a low quality of life and poor health care.

Meanwhile, the rest of the bottom 10 spanned the Southeast and Southwest: No. 50 Alabama, No. 48 Georgia, No. 47 Oklahoma, No. 46 Mississippi, No. 44 South Carolina, No. 43 Texas and No. 42 Arizona. These states tended to have unhealthy seniors and below-average spending on long-term care. However, they did typically have larger older populations, lower costs of living and among the best weather in the country.

Affordability

This category considered a state’s cost of living – measured as an index score where 100 represents the U.S. average – as well as personal income taxes and federal and state payments through Supplemental Security Income. Pennsylvania, Iowa and Tennessee ranked best for affordability, while Massachusetts, California and New York were the worst.

Quality of Life

This category included weather, access to recreational opportunities, and the size of the state’s older community. The best quality of life for seniors can be found in Montana, Maine and Florida, while Texas, Utah and Washington have it the worst.

Health Care

This category tracked the availability of doctors in the state, as well as Medicaid spending on long-term care services and the overall health of the older population. Older adults in Washington, D.C., Alaska and Vermont have the best health care, while those in Florida, Delaware and Alabama struggle the most.

Conclusion

Ultimately, the best state to retire depends on how you prioritize a combination of factors, including climate, cost of living, health care quality, and leisure opportunities. Retirees should consider these elements and others – like proximity to family – to find the perfect location to spend their golden years.

Methodology

We used the most recent data for nine metrics across three categories to determine the best states to retire. We used a Z-score distribution to scale each metric relative to the mean across all 50 states and Washington, D.C., and capped outliers at +/-3. We multiplied Z-scores by -1 when a higher score was considered negative, for example having a higher cost of living and higher rates of income taxes and chronic conditions. A state’s overall ranking was calculated using its average Z-score across the nine metrics. Washington, D.C. and Hawaii were missing temperature data, so their overall scores were created using the remaining metrics. Here’s a closer look at the data we used:

Affordability

• Cost of living index score, Q3 2024 (Missouri Economic Research and Information Center)
• Top personal income tax rate, 2024 (Tax Foundation)
• Average monthly Supplemental Security Income payment, federal and state combined, 2023 (Social Security Administration)

Quality of life

• Share of population that is 65+, 2023 (Census Bureau)
• Average temperature, Dec. 2023-Nov. 2024 (National Oceanic and Atmospheric Administration)
• Arts, entertainment and recreation centers (such as bowling alleys, golf courses, zoos, museums, theaters, sports, casinos and more) per 100,000 people ages 65+, 2023 (Bureau of Labor Statistics)

Health care

• Doctors per 10,000 people ages 65+, 2022-2023 (Health Resources & Services Administration)
• Medicaid spending on long-term care (such as nursing facilities and home health services) per adult ages 65+, 2023 (Kaiser Family Foundation)
• Percentage of Medicare beneficiaries with 3+ chronic health conditions, 2022 (Centers for Medicare & Medicaid Services)