Best States to Retire in 2026: Cost of Living, Taxes, and Healthcare Ranked
Retirement is not just about finding the cheapest place to live. It is about finding the place where your fixed income goes furthest while maintaining access to quality healthcare, favorable tax treatment of retirement income, and a livable climate. This ranking combines all four factors into a single composite score to help you compare states for retirement.
Scoring methodology: Cost of living (40%), tax friendliness including SS treatment (30%), healthcare access (20%), climate (10%). A higher score means better for retirement overall.
Top 10 States for Retirement
North Dakota
Retirement Score: 70.4 | COLI: 94.5
COLI
94.5
Income Tax
None
Property Tax
0.94%
Uninsured %
6.8%
Hospitals/100k
4.2
Est. Annual Cost
$49,140
Median Home: $248,500
Avg Rent: $920/mo
Healthcare Index: 107.2
Avg Temp Range: 24F - 48F
Medicaid Expanded: Yes
Sales Tax: 5%
South Dakota
Retirement Score: 70.1 | COLI: 95.2
COLI
95.2
Income Tax
None
Property Tax
1.14%
Uninsured %
8.2%
Hospitals/100k
3.8
Est. Annual Cost
$49,504
Median Home: $285,400
Avg Rent: $920/mo
Healthcare Index: 107.5
Avg Temp Range: 28F - 52F
Medicaid Expanded: No
Sales Tax: 4.2%
Wyoming
Retirement Score: 69.9 | COLI: 95.8
COLI
95.8
Income Tax
None
Property Tax
0.56%
Uninsured %
9.8%
Hospitals/100k
4.5
Est. Annual Cost
$49,816
Median Home: $298,500
Avg Rent: $920/mo
Healthcare Index: 104.2
Avg Temp Range: 28F - 52F
Medicaid Expanded: No
Sales Tax: 4%
Oklahoma
Retirement Score: 69.2 | COLI: 84.9
COLI
84.9
Income Tax
0.25-4.75%
Property Tax
0.85%
Uninsured %
13.2%
Hospitals/100k
2.4
Est. Annual Cost
$44,148
Median Home: $196,500
Avg Rent: $880/mo
Healthcare Index: 92.5
Avg Temp Range: 48F - 71F
Medicaid Expanded: Yes
Sales Tax: 4.5%
Tennessee
Retirement Score: 67.1 | COLI: 89.7
COLI
89.7
Income Tax
None
Property Tax
0.56%
Uninsured %
9.8%
Hospitals/100k
1.8
Est. Annual Cost
$46,644
Median Home: $298,500
Avg Rent: $1,180/mo
Healthcare Index: 92.8
Avg Temp Range: 48F - 70F
Medicaid Expanded: No
Sales Tax: 7%
Louisiana
Retirement Score: 64.5 | COLI: 89.6
COLI
89.6
Income Tax
1.85-4.25%
Property Tax
0.52%
Uninsured %
8.4%
Hospitals/100k
2.1
Est. Annual Cost
$46,592
Median Home: $198,200
Avg Rent: $930/mo
Healthcare Index: 91.8
Avg Temp Range: 56F - 77F
Medicaid Expanded: Yes
Sales Tax: 4.45%
Texas
Retirement Score: 64.3 | COLI: 91.5
COLI
91.5
Income Tax
None
Property Tax
1.6%
Uninsured %
17.3%
Hospitals/100k
1.3
Est. Annual Cost
$47,580
Median Home: $298,700
Avg Rent: $1,320/mo
Healthcare Index: 95.8
Avg Temp Range: 56F - 78F
Medicaid Expanded: No
Sales Tax: 6.25%
New Mexico
Retirement Score: 63.9 | COLI: 91.3
COLI
91.3
Income Tax
1.7-5.9%
Property Tax
0.67%
Uninsured %
10.5%
Hospitals/100k
2
Est. Annual Cost
$47,476
Median Home: $287,500
Avg Rent: $990/mo
Healthcare Index: 91.5
Avg Temp Range: 42F - 70F
Medicaid Expanded: Yes
Sales Tax: 4.88%
New Hampshire
Retirement Score: 63.3 | COLI: 112.5
COLI
112.5
Income Tax
None
Property Tax
1.86%
Uninsured %
5.5%
Hospitals/100k
1.9
Est. Annual Cost
$58,500
Median Home: $425,800
Avg Rent: $1,580/mo
Healthcare Index: 115.8
Avg Temp Range: 31F - 54F
Medicaid Expanded: Yes
Sales Tax: None
Alaska
Retirement Score: 62.8 | COLI: 127
COLI
127
Income Tax
None
Property Tax
1.04%
Uninsured %
11.2%
Hospitals/100k
2.8
Est. Annual Cost
$66,040
Median Home: $345,700
Avg Rent: $1,330/mo
Healthcare Index: 155.7
Avg Temp Range: 22F - 40F
Medicaid Expanded: Yes
Sales Tax: None
States to Think Twice About for Retirement
These states score lowest on the composite retirement ranking due to a combination of high costs, unfavorable tax treatment of retirement income, limited healthcare access, or extreme climate costs.
Massachusetts
COLI: 148.4 | Score: -1026
Income Tax: 5% + 4% surtax >$1M
Taxes SS: No
Uninsured: 2.9%
New York
COLI: 126.5 | Score: -762.6
Income Tax: 4-10.9%
Taxes SS: No
Uninsured: 5.2%
California
COLI: 142.2 | Score: -172.1
Income Tax: 1-13.3%
Taxes SS: No
Uninsured: 6.8%
Connecticut
COLI: 112.8 | Score: -21.4
Income Tax: 3-6.99%
Taxes SS: Yes
Uninsured: 5.2%
Maryland
COLI: 118.2 | Score: 8.6
Income Tax: 2-5.75%
Taxes SS: No
Uninsured: 6%
Which States Tax Social Security?
Most states do NOT tax Social Security benefits. As of 2026, only a handful of states tax Social Security income, and several are in the process of phasing out this tax. Here are the states that still tax SS benefits to some degree.
| State | COLI | Income Tax Range | Taxes SS? |
|---|---|---|---|
| Connecticut | 112.8 | 3-6.99% | Yes |
| Kansas | 86.5 | 3.1-5.7% | Yes |
| Minnesota | 97.1 | 5.35-9.85% | Yes |
| Nebraska | 90.8 | 2.46-5.84% | Yes |
| Utah | 103.5 | 4.65% | Yes |
| Vermont | 114.5 | 3.35-8.75% | Yes |
| West Virginia | 84.1 | 2.36-5.12% | Yes |
Several states are reducing or eliminating Social Security tax over the next few years. Check current state legislation for the latest status.
What Retirees Often Overlook
The biggest mistake retirees make when choosing a state is focusing exclusively on cost or taxes while ignoring healthcare access. A state with low costs but limited specialist care can become very expensive if you need to travel for medical treatment. Similarly, states with no income tax may have high property taxes that eat into your savings, especially if your retirement income is relatively modest.
Healthcare infrastructure matters more as you age. States like Iowa, Minnesota, and Nebraska have some of the highest hospitals-per-capita ratios and lowest uninsured rates in the country. If you have chronic conditions or anticipate needing regular specialist care, proximity to quality healthcare should weigh heavily in your decision.
Climate costs are real. Extreme heat in summer (Arizona, Texas) and extreme cold in winter (Montana, Wyoming, North Dakota) drive up utility costs and can limit your ability to enjoy outdoor activities year-round. States with moderate climates like Tennessee, North Carolina, and Virginia offer lower utility costs and more comfortable year-round living.
For a detailed look at how your specific retirement income translates across states, visit our cost of living calculator or the salary purchasing power tables.
Frequently Asked Questions
What is the best state to retire in 2026?
The best state depends on your priorities. For lowest overall cost, Tennessee and Florida combine no income tax with below-average or moderate cost of living. For healthcare access, Iowa and Minnesota excel with low uninsured rates and high hospitals per capita. For warm climate and low taxes, Florida is the traditional choice, though its COLI has risen to 102.8.
Which states don't tax Social Security?
Most states don't tax Social Security. Only 9 states tax Social Security to some degree: Colorado, Connecticut, Kansas, Minnesota, Montana (partial), Nebraska, New Mexico (partial), Utah, Vermont, and West Virginia. The remaining 41 states plus DC exempt Social Security from state income tax entirely.
What is the cheapest state to retire in?
Mississippi has the lowest cost of living (83.3 index) and doesn't tax Social Security, making it the cheapest for raw expenses. However, for a balance of cost, healthcare, and quality of life, states like Tennessee (89.7, no income tax, mild climate) and Alabama (87.9, very low property tax) offer better overall retirement value.
Is Florida still a good state for retirees?
Florida remains popular thanks to no income tax, no Social Security tax, warm climate, and excellent healthcare infrastructure. However, its cost of living has risen to 102.8 (above average), property insurance costs have surged, and the housing market is significantly more expensive than a decade ago. It is no longer the 'cheap' retirement option it once was.
How much do I need to retire comfortably by state?
A retired couple needs approximately $42,000-$50,000 per year in the cheapest states (Mississippi, Arkansas, Oklahoma) and $75,000-$95,000 in the most expensive (Hawaii, Massachusetts, California). This assumes owned home, Medicare coverage, and moderate lifestyle. Use our calculator to compare specific states.