What is the cheapest and happiest state for retirees?
What is the cheapest and happiest state for retirees?
It is not possible to find a single winner. The most affordable places and the locations with the highest well-being scores rarely overlap. Recent cost-of-living data presents Oklahoma, Mississippi, and West Virginia as the most affordable. Meanwhile, WalletHub ranks Hawaii, Maryland, and Nebraska as the top 3 for personal well-being. This divergence explains why it pays to look for a comfortable middle ground instead of a single label.
Which states are cheapest for retirees?
If stretching the retirement savings is the main target, then everyday affordability takes priority. MERIC’s 2025 annual averages present the states with the lowest living expenses as below:
Oklahoma
Mississippi
West Virginia
Cheaper housing and groceries make the Social Security & pension checks go much further. It should be recognized that a low price tag does not dictate how much an individual will actually enjoy living there.
Which states rank highest for happiness?
Well-being studies take physical health, emotional satisfaction, community ties, and local work environments into consideration. In WalletHub’s 2025 state ranking, the leaders are: (wallethub.com)
Hawaii
Maryland
Nebraska
Hawaii takes the top spot for well-being, but MERIC data also indicates it is the most expensive state in the country. A location with excellent amenities might be very hard on a fixed income.
What is the optimal way to choose a retirement state?
The personal answer comes down to what is valued most:
Pick a low-cost state if the monthly budget is tight
Pick a state with high quality-of-life scores if health care & community access are the main concerns
Look closely at state tax laws before you move — especially regarding pensions & retirement withdrawals
Does it change the answer for Massachusetts retirees?
Yes. In the case of living in MA, judging the state strictly by its high cost of living misses part of the scenario. Massachusetts does not tax Social Security benefits. Yet, the state manages other retirement income distinctly. That specific tax break has the potential to completely shift the math when you compare Massachusetts against a supposedly "cheaper" state.
How can Dimov Associates help?
Our team is available to review the entire taxation before you pack your bags or file the next return. Dimov Associates compares how different states treat the specific mix of pensions and Social Security, as well as investment accounts. If you require a concrete, side-by-side comparison before picking a retirement destination, let us know.