best-states-to-retire

Top 3 Cities Where Retirees are Moving to for a Better Quality of Life

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Key Takeaways:

  • Large cities retirees and early retirees are moving to: New York, Los Angeles.
  • Midsized Cities: Florida makes up the majority of cities in this category (7 of the top 10). The Villages, Fla. is #1.
  • Small Cities: Arizona cities make up seven of the top 10. Sun City, AZ is #1.
  • What’s so special about Arizona, Florida, and New York ? See below.

Cities where retirees and early retirees are moving to:

Small Cities Midsize Cities Large Cities
Sun City, Ariz. The Villages, Fla. New York, NY
Fortuna Foothills, Ariz. Port St. Lucie, Fla. Los Angeles, Calif.
Green Valley, Ariz. Scottsdale, Ariz. Houston, Texas
North Fort Myers, Fla. Lakeland, Fla. Mesa, Ariz.
Oro Valley, Ariz. Surprise, Ariz. San Diego, Calif.
Venice, Fla. Cape Coral, Fla. Phoenix, Ariz.
Sun City Center, Fla. Fort Myers, Fla. San Antonio, Texas
Apache Junction, Ariz. Bonita Springs, Fla. Philadelphia, Penn.
Prescott Valley, Ariz. Vancouver, Wash. Chicago, Ill.
Sun City West, Ariz. Palm Coast, Fla. Jacksonville, Fla.

Why are retirees moving to Arizona, Florida and New York?

1. Arizona – Top “Small City” choice for Retirees.

Advantage 1: Low to moderate taxes

  • Arizona is retiree-friendly when it comes to your Social Security benefits, inheritance, and estate taxes—that’s because you won’t get taxed. However, Arizona does charge state income tax as well as taxes on most retirement sources, such as 401(k)s and IRAs, hence the “moderate” tax-friendly label

Advantage 2: Affordable Housing

  • The median home value in Arizona is $314,071 which is slightly higher than the median value for the United States       ($272,446).
  • Arizonians also pay very little in property taxes compared to other states (38 states tax at a higher rate, including Florida). Based on the median home value, the average annual tax bill is $1499.
  • Insurance is low as well ($1,976 vs $3,643 for Florida).

Advantage 3: Warmer weather and very scenic

  • Retirees tend to favor warmer weather plus impressive views (Grand Canyon, Sedona, and the Hoover Dam).

Bottom Line:

  • Arizona has a great combination of low taxes, warm weather, low house prices and low property taxes – making it a great option for retirees.

2. Florida – Top “Medium City” choice for Retirees.

The U.S. News & World Report publishes an annual “Best Places to Retire” study based on various factors, including taxes, affordable housing, happiness ratings, and desirability. In their 2021 edition, 13 of the top U.S. 25 cities (and 7 out of the top 10) to retire were in Florida;

Advantage 1: Zero state taxes

  • You won’t get taxed on earned wages and sources of retirement income such as Social Security benefits, pensions, 401(k)s, and IRAs.
  • There is also no inheritance or estate tax in Florida, allowing you to leave more for your heirs.

Advantage 2: Affordable Housing

  • The median home value in Florida, as of early 2021, is $273,094, which is in line with the median value for the United States ($272,446). Compare that to $314,071 in Arizona, and you can see that, generally speaking, homes in Florida are very affordable.
  • Floridians also don’t pay a lot in property taxes. Based on the median home value, the average annual tax bill is $1914.

Watch out for: Humidity, Insects, and Hurricanes

  • Miami, West Palm Beach, Jacksonville, and Tampa rank among the top 20 cities with the highest number of termite treatments per year, according to the pest control company Terminix.
  • Due to the number of hurricanes, the flooding, and the wind damage that occur in the state, homeowners’ insurance, according to insurance.com, is more expensive in Florida than in almost all other states, except for Oklahoma and Kansas.
  • The national average cost for a homeowner’s policy for a $300,000 dwelling with a $1,000 deductible and $300,000 worth of liability coverage is $2,305. The average rate for Florida is $3,643.

Bottom Line:

  • Florida has a great combination of low taxes, warm weather, low house prices and low property taxes – making it a great option for retirees.
  • However, watch out for humidity, insects and hurricanes.
  • Suggest a retiree rent for a few months to see if the area is suitable for them long term.

3. New York – Top “Large City” choice for Retirees.

By far, the most popular large city for retirees in the United States was New York City. Seniors moved to NYC in droves, attracted by the city’s cultural amenities such as restaurants, theatres, and museums. Although the coronavirus pandemic interrupted the flows of seniors in 2020, it is likely that the city will become popular among retirees again once the pandemic subsides.

Advantage 1: Cultural and Amenities

  • Seniors are attracted to the city’s cultural amenities such as restaurants, theatres, and museums.
  • They can take the subway and walk – no need for a car.
  • Some seniors prefer an active lifestyle and being around a lot of people as opposed to a quiet life.

Advantage 2: Infrastructure in place to deliver prescriptions, groceries, and food

  • Title says it all

Watch out for:

  • Relatively high housing costs and property taxes.

Bottom Line:

  • Some seniors prefer the big city lifestyle where they have access to cultural amenities like broadway shows, theatres, and museums.
  • New York continues to attract the largest number of seniors that prefer a big city lifestyle.

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