Where are the cheapest places to retire in the U.S.?

Thomas Corley

The oldest baby boomers — and maybe some not so old — are making the transition now from worker to retiree. And that poses new challenges, not just what to do in retirement, but where to do it? CPA Thomas Corley helps his own clients make those decisions, and now shares with BoomerCafé some of the conclusions he reached in his new book, “The Top 100 Cheapest Places to Retire in the U.S. in 2012.”

With the near economic collapse of 2008, when many baby boomers lost up to 40% of their retirement nesteggs, the question I have been repeatedly asked is:

“Where are the cheapest places to retire in the U.S.?”

The underlying motivation for the question was the loss in retirement assets that resulted from The Great Recession and a common concern: can I retire with the assets or income I have, or expect to have, in retirement?

Florence, Oregon

So two years ago I set out to answer that very question. I organized a small team which helped me analyze more than three thousand select cities, towns, and communities across the United States. We looked for ten key retirement factors and applied a proprietary scoring formula to each factor to figure out which communities ranked highest as the best, cheapest places to retire in the U.S. For each community, we focused on the following ten key retirement factors:

  1. Lowest Housing Costs
  2. Lowest Property Tax
  3. Lowest Sales Tax
  4. Best Climate
  5. Lowest Crime Rate
  6. Lowest Income Tax
  7. Closest to Major or Regional Metropolitan Areas
  8. Closest to Hospitals
  9. Closest to Airports
  10. Closest to Beaches or Coastlines

Deciding where to retire may very well be one of the most important decisions you make as you approach retirement. In today’s economic environment, finding the right affordable place can make the difference between retiring with or without financial worries.

Here is a sampling of a few of the very affordable communities highlighted in my book.

When you think of Mississippi you don’t always think beaches. But there is a small slice of Mississippi heaven on the Gulf Coast that makes you re-think everything about the state. Situated just over 10 miles to the west of Biloxi is the town of Gulfport, just 3 miles from Gulfport-Biloxi International Airport and a short walk to many Gulf Coast beaches. In an hour’s drive east you can find yourself in the heart of Mobile, Alabama and Mobile Bay.

Here you’ll find 6.7 miles of picturesque, white-sandy beaches lining the Gulf of Mexico. There are exciting, fun-filled indoor and outdoor activities, championship golf courses, taste-tantalizing cuisine, plentiful shopping, gambling casinos and must-see cultural attractions.

From its simple, humble beginnings as a lumber and port city, Gulfport has evolved into a diversified, expanding community.


Pensacola beach

Having visited Pensacola on one of my “research missions”… stop laughing, it was a real research mission… I can’t help but express my unbridled bias toward this most unique coastal community.

Let me paint you a picture. You are sitting on your porch or deck. A few hundred feet to the west is the bay, with its own flat sandy beach; at the same distance to the east is the ocean, with its fluffy white sand and warm tropical ocean temperatures. You’re hungry so you decide to bar-b-que on one of the many free grills that pepper the public beaches. You’re thirsty and decide to take short stroll alongside the beach to Peg Leg Pete’s Oyster Bar.

Mm mm, sounds too good to be true doesn’t it? Well that’s Pensacola. Pensacola is, hands down, this author’s top pick of affordable retirement communities.

What you get in Pensacola at a very affordable price is simply hard to believe. Affordable housing, exceptional location on the panhandle of Florida, no income tax, scenic coastal views, warm waters, beaches on the bay and ocean, boating, fishing galore, great night life, excellent restaurants, free beach access, a quaint trolley and much more makes Pensacola a fabulous retirement retreat.

Take your boat and anchor it off Conch Island and explore the variety of shell life there. Or simply anchor your boat in the bay near the shore and sit down in the water with an aperitif before the dinner bell rings. Comb the bay sea floor for Sandollars of every size. It’s all here and at a very affordable price.

For the first time Oregon makes the list. Florence is situated along the beautiful Siuslaw River on the west coast just 4 miles from Heceta Beach.

Here you can enjoy a stroll along the boardwalk, experience Historic Old Town Florence’s truly unique shopping or dine in one of the many restaurants in the district. From chowder to gourmet pizza, crab encrusted halibut to the famous green donkey burrito; retirees can find a variety of foods to fit any budget. At the south end of Florence you will find 42 miles of magnificent, wind-shaped sand dunes, some rising 500 feet above sea level. These dunes represent the largest expanse of coastal sand dunes in North America. If you’re looking for adventure you’ll find it at the dunes through their guided sand rail tours, self-guided ATV tours, sand boarding, hiking, camping, horseback riding and photography.

Florence is often billed as a river town, and why not with 17 lakes and rivers in and around the area. But the hidden gem is the Pacific Ocean which is located just over the dune. When it comes to enjoying the Ocean, the possibilities for adventure are truly endless. Walk along the surf in search of glass floats, shells, agates and driftwood. Hit the Oregon Coast Trail for hiking, biking or horseback riding. If you like fishing or boating, Florence has that too. There are over a dozen fresh water lakes, which serve anglers and boaters.

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  1. It was very nice of you to recognize Florence,Oregon as the #66 most reasonable place to retire. Some reports claim 1/3 of the Florence population is retired. It is a popular retirement destination.

    However, you made me chuckle with your comment “the hidden gem is the Pacific Ocean”. I will try to find the Pacific Ocean the next time I am in Florence.

  2. Florence sounds like my kind of place. My wife and I have been thinking about moving to Eugene. I’m a big fly fisherman so I need to be by a river, lake, ocean, or some other body of water.

    Probably not any cities from Hawaii on the list. We just got back from there. Talk about an expensive place to live.

  3. This is such a hard thing to determine. The cheapest place is a really tough call because there are so many factors. For me I have found a cheap haven in rural Tennessee because of no state income tax, low real estate prices and the opportunity to have a garden and live a simpler life but that would not fit for some people. I am fortunate enough to have passive income that allows me to live anywhere and not everyone can do that. Finding the cheapest place is not a one size fits all is the point.

  4. It seems like my retirement dream changes on a daily basis. To be honest, at this point, I do not know what is best for me. The one thing that I do know is that the area has to be cheap. Yes, it is sad to admit but I am one of those single women that was busy raising children and the next egg is no longer there. Thanks for the suggestions. I will check these out.

  5. I’m staying put … and happily so. Why would I ever want to move when I already live where others vacation? Southern california! California may not make the list of most affordable places, but by the time I’m ready to retire, my house will be paid off & I won’t need to pay any moving costs to relocate.

    1. Well aren’t you nice to gloat about it?

      I can think of a LOT of reason NOT to be/stay in SoCal: Earthquakes, mudslides, wildfires, floods, high crime, high taxes, VERY high cost of living, even aside from housing, a state economy that is going south and more and more neighborhoods that used to be nice but are now dangerous. Most of it is overcrowded,(tried to go to a beach lately?) noisy and full of drugs, traffic jams/gridlocks, bad drivers and other undesirables.

      1. To Lea … great! Please do stay away. Most of what you wrote is pure jibberish. You’re description only fits the worst parts of LA. Traffic? Crowds? California is a huge state … MOST of which is rural! Did you know California is the #1 agricultural state in the union? Cost of living is high, tho … gee, could it be high because so many people want to live there? You think RJ (above) is gloating just because he/she is happy? I didn’t get that at all. Sounds like you just have a bad case of sour grapes to me.

  6. Teri, the reason people have tended to settle in the South is that it’s warmer down there. Isn’t the Ithaca area as cold as the dark side of the moon during the winter months?

  7. Usually these cheap place in the US can be found in the Midwest or the Southern States. When the time comes to choose the cheapest place to retire in USA visit Ithaca, New York, and explore the area.

  8. Thanks Thomas, for those of us who get “To Live Where Others Vacation”, Pensacola is definitely a boomers paradise. Anything water is possible, we still have seasonally events and the most beautiful beaches in the world. Real estate is cheap, find your retirement home now, and rent it until you retire. Our average price home is $136,000, but we start around $35k and go up to $1M+ on the gulf. I would love to share Pensacola with you!

  9. Great article. We aren’t quite ready to retire, but I love the information you provided so much, that I am asking my spouse to please look for a job in Florence, Oregon. Thank you for a great read.

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