These affordable states will stretch your retirement dollars
You know how every time you go to the grocery store—even the most affordable grocery stores—you can almost see the dent in your wallet? Rising costs hurt all of us, but for retirees on a fixed income, the extra dollars for beef, coffee and other basics add up, and the difference has to be made up somewhere.
You can only stretch a dollar so far, so finding the states where you can meet your basic needs on fewer dollars is a big help for seniors. “Affordability was the most important factor for many retirees considering relocation in retirement,” said Stephen Kates, a Bankrate financial analyst, in a blog post about the Bankrate study that determined the most affordable states for retirees in 2025.
For retirees, moving to one of the most affordable states is often a wise choice. Living in a tax-friendly state is a solid strategy, but some places are better than others if you’re close to retirement and feeling short on cash.
Read on to learn which 10 states ranked tops for affordability for retirees.
Get Reader’s Digest’s Read Up newsletter for more news, humor, travel, tech and fun facts all week long.
How did the study determine the most affordable states for retirees?
Bankrate measured affordability using two criteria: cost of living and housing. Using data from the cost of living index from the Council for Community and Economic Research (2024) and average annual home-insurance premiums from Bankrate’s Quadrant data (May 2025), Bankrate devised its list of the 10 most affordable states for retirees.
New Hampshire was No. 1 on this list last year, but due to rising housing costs, the Granite State didn’t even make Bankrate’s list of the most affordable states for seniors in 2025.
Which state is the least expensive for retirees?
Last fall, a separate study named West Virginia as the state where you can retire with the least amount in savings, so it’s no surprise that Bankrate also determined that the Mountain State is the most affordable one for retirees. Let’s take a closer look at the state where your social security and other retirement dollars get the most mileage.
Why is West Virginia the least expensive state for retirement?
Housing
Housing in West Virginia is affordable for everyone, not just retirees. When the average monthly mortgage payment is $1,000 less than the next most affordable state, that helps retirees maintain a cushion for fun, family and unexpected expenses.
In West Virginia, homeowners insurance averages $1,009 annually, placing the Mountain State in fourth place for affordable home insurance. To put this number in perspective, Nebraska has the most costly home-insurance premiums, which average $6,097 per year.
“For retirees, certain fixed costs like homeowners insurance and property taxes loom large,” Kates said, noting that reasonable housing costs are a thread uniting the most affordable states for seniors to retire.
Cost of living
West Virginia has the lowest cost of living of any state, which helped boost this state to the No. 1 spot, but that’s only part of the affordability picture. “While many of these states have lower-than-average cost-of-living scores, that alone isn’t enough,” said Kates. “There are numerous low-cost states that didn’t make the cut.”
According to West Virginia Economic Development, a state-run website, the cost of living in West Virginia is 12% below the national average. Saving on basic needs allows more people to have access to home ownership, resulting in the state having the highest homeownership rate in the nation at 78.2%.
What other states round out the top 10?
The Northeast and Pacific Coast states are notably missing from the most affordable list, and for good reason—the cost of living in these regions is just too high for most retirees. But as you’ll see below, there’s a wide range of geographical representation on the top 10 list of the most affordable states for retirees.
These are the top 10 most affordable states for retirees:
- West Virginia
- Pennsylvania
- Delaware
- Wyoming
- Ohio
- Wisconsin
- Nevada
- Indiana
- Idaho
- Georgia
Which states are the most expensive for retirees?
On the other end of the affordability spectrum, we have the most expensive places to retire, the states with notoriously higher-than-average cost of living and/or high homeowners insurance. Once the darling for retirees, Florida now has the second-highest home-insurance costs in the country due to climate-change-related hurricanes. Those costs, plus a steadily increasing cost of living, have led the Sunshine State to fall out of favor with retirees.
These are the top five most expensive states for retirees:
- Hawaii
- Nebraska
- Florida
- Massachusetts
- California
RELATED:
- New Report: These Are the Best Cities to Retire in the U.S. in 2025
- New Report: This Is the Safest Retirement Town in the U.S.
- Looking for a New Home? This Is the One Type That’s Most Affordable Right Now
Why trust us
At Reader’s Digest, we’re committed to producing high-quality content by writers with expertise and experience in their field in consultation with relevant, qualified experts. We rely on reputable primary sources, including government and professional organizations and academic institutions as well as our writers’ personal experiences where appropriate. We verify all facts and data, back them with credible sourcing and revisit them over time to ensure they remain accurate and up to date. Read more about our team, our contributors and our editorial policies.
Sources:
- Bankrate: “The 10 most affordable states for retirees in 2025”
- Stephen Kates, CFP, financial analyst at Bankrate
- West Virginia Economic Development: “Quality of Life”
- America’s Health Rankings: “Summary of West Virginia”
