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23 Most Affordable States for Retirees, Ranked

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Some people choose to stay where they are when they retire. Others relocate for a variety of reasons. Perhaps a dream location inspires a move, or it’s because of the availability of certain activities, or even the climate.

Since retiring generally means a reduction in income, most people also have to consider what this will cost. Some states are more retiree friendly when it comes to taxes and the affordability of resources for seniors. You have to consider various criteria.

These are the most affordable states to retire to, based on the adjusted cost of living, tax friendliness and the cost of care services. 

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23. Indiana

Indiana Dunes
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Are Social Security benefits taxed? No

Median monthly adult day care cost: $1,640

Average monthly nursing home cost (for a semi-private room): $7,270

Renters insurance offer: On Lemonade


The details: Indiana’s income tax is a modest, flat rate of 3.23 percent and real estate taxes are middle of the road at 0.87 percent. The state allows some exemptions for retirement income, for military pensions and civil service annuities. Railroad Retirement benefits are exempt. Homeowners 65 and up may be eligible for a reduction in property taxes, depending on income.

Note: The affordability rankings come from a 2022 WalletHub report. The adult day care and nursing home costs are from SeniorLiving.org.

22. South Dakota

south dakota badlands
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Are Social Security benefits taxed? No

Median monthly adult day care cost: $1,560

Average monthly nursing home cost (for a semi-private room): $7,118


The details: When it comes to taxes, South Dakota ranks in the middle, with state and local sales taxes at 6.4 percent and an effective property tax rate of 1.32 percent. These taxes are offset by the fact that there is no state income tax. Those 65 and older who meet requirements are eligible for a property tax freeze or reduction. A tax homestead exemption delays payment of property taxes for eligible taxpayers 70 and older until the property is sold.

21. Oklahoma

tulsa oklahoma
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Are Social Security benefits taxed? No

Median monthly adult day care cost: $1,440

Average monthly nursing home cost (for a semi-private room): $5,475

Renters insurance offer: On Lemonade


The details: Oklahoma has the third-lowest adjusted cost of living in the country. It ranks No. 24 in the nation with an effective 0.9 percent property tax; the state income tax tops out at 5 percent. Social Security and Civil Service Retirement System benefits are not taxed and up to $10,000 per person of other retirement income may be excluded. Depending on income, seniors may be eligible for a property tax refund or a valuation freeze on their home.

20. Missouri

st louis gateway arch
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Are Social Security benefits taxed? They may be taxed

Median monthly adult day care cost: $1,700

Average monthly nursing home cost (for a semi-private room): $5,262

Renters insurance offer: On Lemonade


The details: Missouri’s average nursing home cost is the third lowest in the nation. The state does tax Social Security benefits for individuals with an adjusted gross income of $85,000 or more (for married couples that number is $100,000). Depending on income levels, some taxpayers may be eligible for a private pension exemption. Military pensions are not taxed. Certain senior citizens receive a credit on property taxes or rent paid.