How much money do you need to comfortably retire? This is a question that every American saving for retirement considers. However, there is no fixed answer to this question. It is directly related to your financial situation, and due to the varying cost of living in different states, where you choose to retire can significantly impact your quality of life in retirement.
A recent study conducted by GOBankingRates analyzed the annual expenses for retirees aged 65 and above in all 50 states in the U.S. The data was based on estimates from the Bureau of Labor Statistics on expenses related to food, housing, transportation, healthcare, and utilities, with an additional 20% cash buffer added to ensure retirees can live comfortably.
The study found that there is a staggering difference of up to $67,981 in the cost of living for a comfortable retirement across different states. Hawaii topped the list with the highest average retirement expenses in the country, requiring around $129,296 per year to live comfortably, more than double the $61,315 needed for a comfortable retirement in Mississippi.
The study also revealed that housing costs vary greatly across states. Hawaii has the highest housing costs in the U.S. due to high demand and limited housing space.
On the other hand, Mississippi has the lowest home prices and property taxes in the country, which helps lower retirement costs. Many other rural states have similar situations.
Here are the annual expenses needed by retirees in each state for normal living costs (total expenses) and comfortable retirement costs (comfortable retirement annual expenses), listed alphabetically:
– Total expenses: $50,980
– 20% comfortable buffer: $10,196
– Comfortable retirement annual expenses: $61,176
– Total expenses: $72,390
– 20% comfortable buffer: $14,478
– Comfortable retirement annual expenses: $86,868
– Total expenses: $63,942
– 20% comfortable buffer: $12,788
– Comfortable retirement annual expenses: $76,730
– Total expenses: $51,211
– 20% comfortable buffer: $10,242
– Comfortable retirement annual expenses: $61,454
– Total expenses: $83,906
– 20% comfortable buffer: $16,781
– Comfortable retirement annual expenses: $100,687
– Total expenses: $58,908
– 20% comfortable buffer: $11,782
– Comfortable retirement annual expenses: $70,689
– Total expenses: $65,504
– 20% comfortable buffer: $13,101
– Comfortable retirement annual expenses: $78,605
– Total expenses: $58,387
– 20% comfortable buffer: $11,677
– Comfortable retirement annual expenses: $70,064
– Total expenses: $59,660
– 20% comfortable buffer: $11,932
– Comfortable retirement annual expenses: $71,592
– Total expenses: $52,832
– 20% comfortable buffer: $10,566
– Comfortable retirement annual expenses: $63,398
– Total expenses: $107,746
– 20% comfortable buffer: $21,549
– Comfortable retirement annual expenses: $129,296
– Total expenses: $58,503
– 20% comfortable buffer: $11,701
– Comfortable retirement annual expenses: $70,203
– Total expenses: $53,989
– 20% comfortable buffer: $10,798
– Comfortable retirement annual expenses: $64,787
– Total expenses: $52,253
– 20% comfortable buffer: $10,451
– Comfortable retirement annual expenses: $62,704
– Total expenses: $52,137
– 20% comfortable buffer: $10,427
– Comfortable retirement annual expenses: $62,565
– Total expenses: $50,517
– 20% comfortable buffer: $10,103
– Comfortable retirement annual expenses: $60,620
(as the original document contains a lengthy list of figures, only a portion of it is presented here for brevity)