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6 Great Low-Cost Retirement States

by Bill Ness on 46 Comments

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Many active adult communities offer budget-friendly homes in a resort-style setting such as Del Webb's Lake Providence near Nashville, Tennessee.

Retires living on a fixed income can stretch their savings by settling in an area with lower taxes and a lower cost of living. Of course, price is only one factor when choosing a home. Other considerations include climate, crime rates, local attractions and proximity to family and friends. If affordability and low cost of living is high on your list of priorities, you may want to look for a home in one of these retirement-friendly states.


The Lone Star state offers many perks for active adult retirees. Texas has a sunny climate with hot summers and mild winters. It also has retirement-friendly tax laws including no state income tax, and no tax on retirement income or retired military pay. Homestead exemptions for homeowners aged 65 or better help keep property taxes down, and many areas throughout the state feature a lower cost of living. A few active adult communities which offer affordable housing in Texas include Hill Country Retreat, Del Webb Sweetgrass and Heritage Grand at Cinco Ranch.


Retirees looking for a mild climate and rural charm are beginning to turn to Tennessee. This southern state scores among the lowest cost of living found in the country, and its retirement-friendly tax laws are getting even better. In 2012, the Hall Income Tax Exemption for taxpayers aged 65 or better will increase from $16,200 to $26,200 for single filers and from $27,000 to $37,000 for couples who file jointly. Active adult communities are turning up in the state, such as Lake Providence by Del Webb, which is located in the Nashville area.


There are many reasons why retirees have flocked to Florida, and affordability is high on the list. The Sunshine State has no state income tax and property taxes allow additional homestead exemptions for homeowners aged 65 or better. The cost of living varies throughout the state, though there are many affordable retirement areas, such as the Treasure Coast and Sarasota. A few communities to consider include Seasons at Tradition, Heritage Isle, Del Webb Naples and LakeRidge Falls.


Though Mississippi may not be the first state that comes to mind when picturing retirement, this southern destination is gaining the attention of thrifty retirees. Though Mississippi doesn’t have as many resort areas as other retirement destinations, it has a lovely climate and a generally low cost of living. There is no state income tax on qualified retirement income, and property taxes are relatively low, especially with the additional exemption for homeowners aged 65 or better.


Sierra Canyon in Reno, Nevada boasts stunning views from its location on the slope of the Peavine Mountains.


Though Nevada’s real estate market fell drastically after the housing bubble burst in 2006, the state’s active adult communities have generally fared better. Nevada has no state income tax, which means no tax on retirement income as well. The overall tax burden is low and homebuyers can now find more affordable homes than in past years. Some of Nevada’s most affordable active adult communities include beautiful developments like Sun City Mesquite, Solera at Anthem and Sierra Canyon.


The Peach State was once just a stop-over on the way to Florida, but Georgia is now gaining popularity as a retirement destination. The climate is hot and sunny, and areas like Atlanta and Savannah each have their own distinct charm. Georgia has a relatively low cost of living and its tax laws are becoming more favorable for retirees. There is no state tax on Social Security and residents aged 62 or better may be eligible for a retirement income adjustment. Active adults can find affordable homes in communities like Sun City Peachtree, Cresswind at Lake Lanier and Carlisle Village.

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  1. What states have the lowest state tax, and do not have multiple
    municipal taxes or gasoline taxes on gas for cars such as the
    state of Illinois. Do all these states have lower property
    taxes for Seniors?

    1. Delaware has NO sales tax whatsoever, and is ranked one of the best affordable retirement states in the country. No inheritance tax either.

  2. Does your article on low tax States only include the States that are a part of your current research group of States? In doing some limited research I had heard that Pennsylvania also had friendly tax laws for seniors.

    1. The Henderson area has some nice gated communities. East of Boulder Hwy has increased crime and poverty. Greater Las Vegas has millions of homes in different prices. People who can afford homes in gated communities are buying or renting in those areas due to the increased crime in the Vegas Valley. It is a very transient area. Currently there are no state income taxes. Water and electric are high. The other consideration is the long hot summers. But, there is always something to do here. Hope that helps.

  3. I don’t know how you can ever classify a Del Webb Community as affordable. Maybe to retired doctors and attorneys…..

    1. Sun city peachtree by del Webb is most affordable in area and GA taxes now favor retirees….finally

    2. I have lived in Del Webb’s Sun City Texas for 10 years. Homes range in price from $130,000 upwards. Resales are often the most affordable, going from $100 to $120 per square feet. New homes tend to be a bit more pricey, because they feature upgrades. And, the amenities are outstanding. No sales taxes in TX.

      This is one of the biggest bangs for your buck, anywhere.

  4. These states all have weather that is for the most part not moderate for seniors, either very hot summers, very cold winters and in some cases both. Why not list affordable places with easy climates for seniors such as San Luis Obispo, California.
    Only prpblem with San Luis Obispo is the very high cost of living which would make it not affordable for many seniors. There must be some affordable desirable places with moderate weather and prices. Does anyone that reads these posts know where they are?

    1. Cuenca,Ecuador: 75deg. during the day mid 50’s at night & live comfortable for $ 1200.Mo.No bugs Hi test gas $1.48per. gal. U.S. curency.2bed 900sf hi rise apt $450. per mo.Lunch w/A beer $3.00

  5. I have to agree w/Toni – all the “affordable” senior communities (DelWebb) are very costly for everything. Fees, etc. Nothing is affordable in these communities.

    Interested in seeking out Nevada, Green Valley AZ. Low cost, low fees, protection on retirement, etc.

    1. Yes Id like infor on low cost states for retirees! Warm weather or cold. Indianapolis/south east county communitys low. We paid $119.000.00 for pur house 113.sq ft crown molding thru out redone baths & kitch in 2009. Had to put in hard surface counter tops & stainless appliances though later. Live in small addition thats nice and not a gated community. But growing and seems like all kinds of people moving into area. I hear though were the hwy thru to east & west of country and hear not so good ligistics with maybe terrorist passing through or from Michigan to Illinois to Missouri in a triangle of these types. We worry for our retirment & children up coming life here years down the road. So looking for safe low cost retirement state! Anyone here what im saying just reply back. I’ll keep watching! Thanks, Teresa from outer south side of Indy!

  6. Let me jump in here and mention Del Webb Sun City and Del Webb Sun City West as two of the most affordable retirement communities in the country. The lot assessment fee (rec fee) in the original Sun City AZ is $442 per year (just over $36 per month) We have 8 golf courses and 7 rec centers and 3 of the rec centers are totally rmodeled and as nice as anything you will find in newer communities.

    We have full play golf passes available whereby an owner can golf every day of the year (as many holes as they want) for $1500 and they can get to any of the 8 courses on their golf car from within the walls. Throw in no school taxes (as an example my 2700 sq ft home is taxed at $1000 per year) you can’t beat the cost of living here. Home prices are reasonable and most buyers come in these days and renovate them to fit their lifestyle.

    There is no better value and when you consider we are a self-governed unicorporated community it is intriguing prospect for anyone who wants to be able to give back to keep it a great place to live.

    1. we live in the suncity west area now and we are a retired military couple who plan on moving from az as soon as we can.don’t let anyone convince you that it is a low cost of living here,,that houses are reasonable ect ect! Arizona,expecially phoenix,is the highest place in the state to live,and the suncities are for the exstream higher income folks,or snow bunnies,not for moderate income folks.



      1. Too funny Margot (see no caps necessary to shout though). I’m a bleeding heart liberal from MN (Hubert Humphrey was my hero) and especially love the original Sun City…a literal utopian idea. It’s a collective for seniors, almost hippie like eh?

        And thanks for asking about hospitals and museums, we have 1 of the top 100 hundred heart hospitals in the country within our walls. Impressive don’t you think? And I love our little Sun City museum. It’s the first model home in Sun City (originally 860 square feet) and has been the source of information on age restricted communities for the past 30 years.

        Let’s recap: prices start at around $40,000 for a small 1 bedroom, 1 bath condo. Lake properties can run around 400K with prices everywhere in between those two figures. Rec fees are $462 per year (no matter which property you live in) and they are that way because we are self-governed. We run ourselves, no city government and we donate millions of hours a year to keep it feeling like a small town and affordable..

        Again, thanks for asking.

    1. Bill, are you sure you don’t have some sort of vested interest with your continued accolades of Del Webb????

      I also live in a Del Webb community on the east coast and our HOA dues are $235/ month or $2820/ year with a guaranteed (according to the Board President) increase of 3-5% a year. Might I add, with needless spending, poor accountability by the community manager and the list goes on.

      As anyone can readily see, this type of expense could easily cause many seniors on a fixed income to be forced to relocate to another home from their Del Webb supposed ‘dream home’. May I also add, that this has happened in my community and continues to happens, as more and more residents are listing their homes for sale. They happen to be in an unfortunate predicament since we are not at built out and these folks are competing with Pulte/Centex new builds. These poor folks also are not permitted to display a FOR SALE sign as this is against the covenants.

      So Bill, you can send forward all the accolades you wish regarding Del Webb, however, this is the harsh reality from a resident of a Del Web community.

      I hope this is of some help to folks who are looking “where to retire” because Del Webb communities are not as rosy as you continue to allege. Or is it just the case that economics is not an issue for you as it is for some many these day….if so, congratulations, but please don’t mislead those “not in the know” seniors. Thank you!!!

      1. Valerie, not sure if your question pertains to Bill Ness the author of this article or Bill Pearson, who commented on Sun City in Arizona. Either way, I think your comments are way off the mark. The purpose of this website is to help people decided where to retire and since Del Webb is the biggest builder of retirement communities they are bound to get a few mentions.

        I happen to live in a Del Webb community. In fact I found it because of 55places.com. I absolutely love it here and so do most of my neighbors. My community is filled with about 95% of people who really like it here. The other 5% seem to chronically complain about one thing or another.

        Valerie, you make it sound as though you were victimized by the builder when in fact I’m sure you were notified of the HOA fees prior to purchasing. And is a 3-5% increase (which also happens to be in line with inflation and general cost of living increases) really that surprising?

        Also, when you factor in all that you get for the fee it seems very reasonable to me. Prior to living here my wife and I each paid $50/month for health club memberships, $100/month for lawn care and at least a $100/month for general home upkeep and repair (if not more). Now I only pay $240 a month and I get to use a nice clubhouse, my landscaping is all done for me and the association pays for all the exterior maintenance of my building. Plus I’m surrounded by many new friends and my social calendar has never been more filled.

        The fact is that an active adult community isn’t for everyone. I’m sorry it didn’t work out for you but I don’t think it is fair to bash a lifestyle that most people in my community really seem to enjoy.

        To anyone who wants to live in a 55+ community (whether it is Del Webb or any other builder), do your research and talk to several residents. My guess is you will tend to find mostly people who have nothing but good things to say about their community.

  7. Dave,

    I am happy for you that you appear to have chosen the right community for you.

    I did want you to know that we did our due dilligence and visited the Del Webb community we live many, many times before purchasing. We also spoke to numerous residents who spoke freely of their contentment with their decision to make an investment in this community. Believe me, we did not act blindly nor foolishly and simply buy because the models were decorated nicely.

    What folks need to realize is that one can speak with as many residents as one chooses, however, actually living within a community is something completely different. This is when one actually realizes the inner workings of the community and for some they work and for others they do not. We except accountabilty and responsibility when it comes to our pocket book and maintaining the integrity of our investment.

    I again am happy for you that you feel you are getting your money’s worth. I simply felt morally obligated to inform unsuspecting seniors that a retirement community is not ‘summer camp’ filled with new friends and activities all day long. It is your future and probably the last home most seniors will purchase. Therefore, it is extremely important for our peers to know both sides of the story and hopefully with such knowledge they can make the proper decision for themselves and not a regretable one.

  8. Valerie: I do have a vested interest in Sun City AZ; i want it to be a great place for seniors to retire to for years to come. I’ve posted on this site and my blog a dozen times the best way for people to get a sense of any senior community is to rent before you buy.

    Dave is spot on; every community has it’s own nuances and the best way for people to get a feel for it is to immerse themselves in its lifestyle. Costs are obviously one variable, but there are dozens of other ways to measure whether a community is right for you.

    I do post facts and figures regarding the original Sun City in Arizona because i am acutely aware of what they are. I understand the community as well as anyone simply because i’ve spent the last 9 years involved in it. 2 years with the visitor center; three years with the home owners association; three years with the Del Webb Sun Cities Museum; all the writing for the 50th anniversary and i’m now on the board of the Rec Centers of Sun City.

    I love the community; love the way of life and by writing these comments i am trying to encourage people to try an age restricted community rather than just writing it off because it’s not for them. Most people, until they visit, have no clue what it is all about. It was the biggest challenge Webb/DEVCO faced in the 60’s and 70’s and it’s still a struggle some 50 years later.

    Hope that helps explain my sense of joy for finding our place in the sun…hoepfully you will too.

  9. Bill,

    Let me begin by saying that I could not be more happy for you that you have found “joy in your place in the sun”. My fervent hope is for all seniors to find “joy” in this precious time in their lives, no matter where they choose to live.

    Having said that, might I now add that I understand your need to expound upon your ‘joy’, but please be aware that in doing so, you might encourage folks into an ‘active adult community’ without them being able to fully understand all the perameters and decide if this type of living is truly right for them.

    I must also add that we are neither chronic complainers nor are we unhappy. We are very happy with and comfortable in our home. We have made some wonderful friends.

    We have also lived in this Del Webb community long enough to see what might be overwhelming and extremely disappointing to those who are not aware of the inner workings of this type of community. It is very different from the basic suburban residential community. It can be very controlling if one does not know how to protect themselves and most especially if one has never lived in an HOA run scenerio. We have never lived in a community that was not run by an HOA. We find restrictive convenants to actually be ‘protective’ covenants. My husband served on the Board of the HOA from our former long time residence for many years.

    Renting, as you suggest, is always a good idea if one is totally unfamiliar with the area and particulary the community. The only problem here is that if the rental is not for a full year, it serves no real purpose. It takes sometime in an active community to fully understand the problematic inner workings and how these can affect both one’s lifestyle and investment.

    It took us some time to realize that many of the resident volunteers for the various committees unfortunately were volunterring for self serving interests. Volunteerism is a wonderful thing to do, but one must come into this with the utmost of integrity and be willing to work for the community at large. Our experience has shown that the majority of volunteers in our community have stepped forth, unfortunately, solely with self serving interest. This interest has come in the form of ‘wanna bes’, i.e., to be seen and known as authority figures with dilusions of power. How sad to have this need at our age and how sad that this need for accomplishment was not satisfied during their working careers.

    The behavior and attitude of this type of person volunteering in our community has caused tremendous dissention amongst the residents. Our community is still in the Declarant Control Period which makes this even worse. We are sincerely hoping that once the governmental aspect of the community is turned over to the residents and we can actually vote for qualified resident leaders, this problem will be eradicated and we can all live peacefully in this very precious times in our lives.

    I am giving the general senior population this information so that they can make their decision of where to live in their retirement years with knowledge from both sides, not simply your continued reteric on your experience of ‘joy in the sun’.

    Again, I repeat that I am happy for you. However, I think we can all sleep the best at night knowing that there are always two sides to a story and knowing that our fellow seniors have gotten ‘both sides’. My best to you for your continued happiness.

  10. We are looking into the 55+ communities and appreciate the comments by everyone. We have been looking for a good resale website but have not found any so far. Most websites want us to provide our contact information so that real estate agents can bombard us with the homes they are touting.

    1. Dan, where are you looking? 55places is in the process of adding resale listings for all of our communities. We have most of the West half of the country done and in the next couple months we are going to work on the eastern half of the country. (we wish it could happen sooner but it is a major project!)

      Just look for the “Homes for Sale” tab on each of our communities.

      1. We have been looking in AZ, FL, and NV (Las Vegas). Probably, we should rent for awhile to get to know the communities and what they have to offer.

  11. Hoping to find my dream home in Sun City or McDonald Ranch in Henderson, NV. I’m so happy to have found this website to assist those of us who are looking to relocate to a beautiful, active, safe retirement community.

  12. I retired 18 months ago as a School Administrator. I am looking to relocate from the cold weather in the East Coast to a 55+ community. As a widow, I am not sure if I could adjust in the 55+ community as a single woman, since most of the residents appear to be married couples. I would appreciate any comments.

    1. As long as you understand the dynamic of the place….and the wives don’t feel you are trying to steal their husbands…you should be fine!

  13. It’s nice you all are talking about these communities, however, when you are on a fixed income Del Webb Sun City – homes are way above the average senior’s budget. Is there somewhere in the country where one can live in a safe senior community that will not kill the restrictive budget? When I say restrictive I mean around 2000 a month for 2 people.

    Thank you

  14. I’m a cheapskate retired millionaire, who collects social security, retirement at age 62, and is able to live well enough in three quarter of full retirement. My house is worth about a half a million in Dothan Alabama, where the same would cost near five million in Los Angeles.

    Being originally for LA, I hate cold weather! Seriously, my AC set at 85 degrees; summer utilities are low, the opposite is true in winter, thermostat is 75 degrees, warmer climates are cheaper for me. My property taxes are low; however, my state income tax, high, I may save in Florida, most likely the case after I turn 65.

    I do not look for trendy retirement towns seen in books; I look at the home value, usually brick, or stone, no plastic, and size, price per square feet, usually under $90. I look for closeness to a good hospital, and crime, usually stated as a statistical average; were I live, crime is far below the town average. I drive less the 1000 miles a year! Mainly I like to stay in my home, do little chores and hobbies, and watch movies on my HT systems, purchased before I retire. No interest in pay TV, it’s a gyp; I prefer DVD shows and movies, my kids give me. My single extravagance is my pool, and should I settle again, it may be without that luxury.

    My list to best place to retire, would be, climate, sub tropical; the negative, lightning and thunderstorms. Followed by cost to purchase home, property taxes, income taxes, does state deduct federal income tax? Shopping, sales tax means little, since I buy little other than food, so tax exempt food would be another plus.

    1. DocKate R – What good is it to have such an expensive home if you spend your days penny pinching? Sounds sad and lonely.

  15. Having done all the “right” things in order to have a good retirement income I was blindsided by losing my parents, aunt and uncle, as well as my adult son and paying for five funerals. I had to sell my house in Florida in order to move north to look after the older generation whose illnesses ranged from dementia and stroke to Parkinson’s and Alzheimer and needed my full time help. By the time that they all passed away (my son was unexpectedly) I was chronically depressed and my savings were gone. Both my husband and I have social security and that’s about it. Are there any communities where we can rent and still find joy?

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