Growing your retirement savings is important, but the amount you actually need depends on where you are. That's because, according to one study, the annual cost of living can vary by more than $71,000 between U.S. states. Recent GOBankingRates analysis.
Hawaii has the highest average retirement costs, with an estimated $129,296 per year needed to retire comfortably. That's more than twice as much as in West Virginia, where retirees need an average of $58,190.
To calculate annual retirement costs for Americans age 65 and older in each state, the study used estimates from the Bureau of Labor Statistics for food, housing, transportation, health care, and utilities. A 20% cash buffer was added to this total to help retirees live “comfortably,” according to the study.
The large difference in living costs is mainly due to the high cost of housing. In states with housing shortages — Hawaii, California, Massachusetts etc. — The annual cost of retirement benefits exceeds six figures.
Based on our data, the median annual cost to retire comfortably is $66,870. That said, there are 20 states where you can retire on less than $65,000. They tend to live in southern, rural states, where the cost of living is lower.
Below is a list (in alphabetical order) of states with annual retirement benefits of $65,000 or less.
alabama state
- Total expenditure: $50,980
- 20% comfort buffer: $10,196
- Annual cost of a comfortable retirement: $61,176
arkansas
- Total expenditure: $51,211
- 20% comfort buffer: $10,242
- Annual cost of a comfortable retirement: $61,454
georgia
- Total expenditure: $52,832
- 20% comfort buffer: $10,566
- Annual cost of a comfortable retirement: $63,398
illinois
- Total expenditure: $53,989
- 20% comfort buffer: $10,798
- Annual cost of a comfortable retirement: $64,787
Indiana
- Total expenditure: $52,253
- 20% comfort buffer: $10,451
- Annual cost of a comfortable retirement: $62,704
iowa
- Total expenditure: $52,137
- 20% comfort buffer: $10,427
- Annual cost of a comfortable retirement: $62,565
Kansas
- Total expenditure: $50,517
- 20% comfort buffer: $10,103
- Annual cost of a comfortable retirement: $60,620
kentucky
- Total expenditure: $53,584
- 20% comfort buffer: $10,717
- Annual cost of a comfortable retirement: $64,301
louisiana
- Total expenditure: $53,295
- 20% comfort buffer: $10,659
- Annual cost of a comfortable retirement: $63,954
michigan
- Total expenditure: $53,121
- 20% comfort buffer: $10,624
- Annual cost of a comfortable retirement: $63,745
mississippi
- Total expenditure: $51,096
- 20% comfort buffer: $10,219
- Annual cost of a comfortable retirement: $61,315
missouri
- Total expenditure: $51,211
- 20% comfort buffer: $10,242
- Annual cost of a comfortable retirement: $61,454
nebraska
- Total expenditure: $54,047
- 20% comfort buffer: $10,809
- Annual cost of a comfortable retirement: $64,856
new mexico
- Total expenditure: $54,163
- 20% comfort buffer: $10,833
- Annual cost of a comfortable retirement: $64,995
north dakota
- Total expenditure: $53,700
- 20% comfort buffer: $10,740
- Annual cost of a comfortable retirement: $64,440
oklahoma
- Total expenditure: $49,996
- 20% comfort buffer: $9,999
- Annual cost of a comfortable retirement: $59,995
south dakota
- Total expenditure: $54,047
- 20% comfort buffer: $10,809
- Annual cost of a comfortable retirement: $64,856
tennessee
- Total expenditure: $52,253
- 20% comfort buffer: $10,451
- Annual cost of a comfortable retirement: $62,704
texas
- Total expenditure: $53,468
- 20% comfort buffer: $10,694
- Annual cost of a comfortable retirement: $64,162
west virginia
- Total expenditure: $48,492
- 20% comfort buffer: $9,698
- Annual cost of a comfortable retirement: $58,190
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