2026’s Top 5 Retirement‑Friendly States: Cost and Safety Breakdown

Retirement planning is no longer just about sunshine and beaches; the variables that determine how far your savings stretch are becoming increasingly complex.

Measuring Retirement Costs and Quality of Life

Polaris Home Care’s 2026 "Retirement Index" combined eight core criteria—healthcare expenses, housing costs, tax rates, daily living expenses, crime rates, and average earnings—to rank all 50 states.

States Leading the Rankings

■Idaho – A flawless 100 score; annual $8,148 medical spend, 41% lower crime rate, and $63,894 average earnings.

■Arizona – 90.67 score; low 0.41% property tax, average $63,692 earnings, and monthly utility costs around $524.

■North Dakota – 90.48 score; $65,127 average earnings and yearly $3,810 food spend, about $500 below the national average.

■Mississippi – 88.90 score; housing costs 15% under the national average.

■West Virginia – 88.45 score; lower healthcare service costs.

Regional Cost Drivers

■Housing: Represents roughly 30% of an retiree’s budget; spikes to 45% in high‑cost states like Florida and California.

■Healthcare: Annual spend ranges $8,000‑$9,000, varying by state up to 20%.

■Transportation: Averaging $7,200 per year, with low‑density states seeing a 10% reduction.

■Taxation: State property tax rates sit between 0.3%‑1.2%; lower‑tax jurisdictions boost retirement appeal.

Investment Implications

■Real Estate Portfolios: Low‑tax, low‑housing‑cost states—especially Idaho and Arizona—deliver rental yields of 6‑8%.

■Healthcare Infrastructure: Lower medical expenses signal opportunities for regional clinics and senior‑care facilities.

■Consumer Spending: Reduced food and energy costs can enhance margins for retail and service sectors.

■Risk Management: High crime and lower‑income areas elevate long‑term investment risk; diversification remains essential.

Variations in retirement‑living costs shape not only personal decisions but also capital flows into real‑estate and healthcare sectors. States like Idaho and Arizona, with low tax burdens and high earnings, present strategic opportunities for both settlement and asset allocation. Portfolio managers should monitor these dynamics closely to fine‑tune risk‑return profiles. – Kemal Tekin, Head of Emerging Markets Strategy