Cost of living : 4 percent below U.S. average
Population : 5.9 million
Best city : Madison PROS: The Badger State offers a low cost of living and tax breaks on the retirement income of low-income residents. It also has some of the best cheese in the country, and if you’ve never tried a cheese curd you’re in for a treat.
CONS: Wisconsin is not especially tax-friendly and has the lowest average household income for residents 65 and over in the country. Social Security is exempt, but all other retirement income is taxed. To make matters worse, healthcare costs are higher than the national average.
Cost of living : 10 percent below U.S. average
Population : 4.67 million
Best city : Baton Rouge
PROS: With a below-average cost of living and plenty to see and do, Louisiana could be a great fit for some seniors. The state is filled with music and the tourist destinations of New Orleans and Baton Rouge. It is also known for its amazing food, interesting people and incredible natural swamps. There will certainly never be a dull moment.
CONS: Like many states in which the cost of living is low, the incomes are also low. The average per household for residents 65 and over is $50,744. That may make it difficult for retirees to afford necessities like healthcare, which is 2.1 percent more expensive than the national average.
Cost of living: 24 percent above the U.S. average
Population: 3.6 million
Best city: Darien
PROS: Connecticut retirees have some of the highest income in the nation. They may still be able to live there in style despite the high cost of living, if they find a suitable retirement job.
CONS: Connecticut is actually one of the least tax friendly states in the country. Almost all of retirement income is fully taxed and some residents may even have to pay taxes on their Social Security benefits. The state doesn’t offer much in the way of other benefits to make up for this policy.
Cost of living: one percent above the U.S. average
Population: 786,729 Best city: Rugby PROS: North Dakota is tax-friendly for retirees with low-income tax rates of 1.1 to 2.9 percent and a low cost of living to boot. Plus, you would be hard-pressed to find a more beautiful natural landscape.
CONS: North Dakota taxes retirement income but that shouldn’t impact retirees greatly since the cost of living is low. Like South Dakota, this is not the place for city lovers with a population on only 786,729.
Cost of living: 11 percent above U.S. average
Best city: Rehoboth Beach
PROS: Delaware was rated as tax-friendly. The state does not tax Social Security benefits and also exempts some investment and pension income for people over 60.
CONS: The cost of living is still 11 percent above the national average and seniors in the state have a below U.S. average income. When you combine these two things, it may be hard for some retirees to easily afford their essentials in Delaware.