Best Places To Retire

10 Best Cities to Retire in Alabama in 2022

10 Best Cities to Retire in Alabama in 2022

When people think of retiring to a warm Southern climate, Florida is often the first state that comes to mind. But neighboring Alabama has plenty to offer, as well, including charming small towns and beach communities. The best places to retire in Alabama are both affordable and packed with amenities, with a cost of living that doesn’t break the bank.

Stephanie Faris

Published February 17th, 2022

Table of Contents

Key Takeaways

  • In recent years, more retirees are choosing an Alabama retirement for a variety of reasons.
  • Social Security income and pensions aren’t taxed in Alabama, and many areas have a low cost of living.
  • In choosing a city for your Alabama retirement, it’s important to compare the 65+ population, the cost of living, and access to all the amenities you’ll need.

When people think of retiring to a warm Southern climate, Florida is often the first state that comes to mind. But neighboring Alabama has plenty to offer, as well, including charming small towns and beach communities. The best places to retire in Alabama are both affordable and packed with amenities, with a cost of living that doesn’t break the bank.

Is Alabama tax-friendly for retirees? Absolutely. The state doesn’t tax Social Security income or pensions, letting older adults keep more of their earnings. Here are some of the top towns to consider if Alabama is on your retirement wish list.

Auburn

CITY POPULATION: 66,259

SHARE OF POPULATION 65+: 8.1%

COST OF LIVING FOR RETIREES: 8% below the national average

PER CAPITA INCOME FOR POPULATION: $28,510

TAX RATING FOR RETIREES: Tax Friendly

Those looking for retirement communities in Alabama should consider Auburn, perhaps best known as home to the University of Alabama. But the best thing about Auburn is that as you’re looking for where to live in Alabama, you’ll find some great active adult communities, as well as access to golf courses and arts and culture.

Hamilton

CITY POPULATION: 6,606

SHARE OF POPULATION 65+: 21.0%

COST OF LIVING FOR RETIREES: 23% below the national average

PER CAPITA INCOME FOR POPULATION: $20,601

TAX RATING FOR RETIREES: Tax Friendly

You can further the benefits that low Alabama retirement taxes give retirees by choosing Hamilton, which has some of the lowest property taxes in the state. You’ll find plenty of small-town charm here, along with a robust 65+ population.

Fairhope

CITY POPULATION: 22,677

SHARE OF POPULATION 65+: 23.4%

COST OF LIVING FOR RETIREES: 6% above the national average

PER CAPITA INCOME FOR POPULATION: $41,613

TAX RATING FOR RETIREES: Tax Friendly

Fairhope is one of the best places to retire near water in Alabama because of its breathtaking views of Mobile Bay. If you’re looking for where is the best place to retire in Alabama, though, this town hits the mark for a large number of reasons, thanks to plenty of events and attractions.

Dothan

CITY POPULATION: 68,941

SHARE OF POPULATION 65+: 17.8%

COST OF LIVING FOR RETIREES: 13% below the national average

PER CAPITA INCOME FOR POPULATION: $28,980

TAX RATING FOR RETIREES: Tax Friendly

For those debating retiring in Alabama vs. Florida, the border town of Dothan offers the best of both worlds. You’ll be just a half an hour or so from the Florida line in this town, which is also home to the National Peanut Festival.

Huntsville

CITY POPULATION: 200,574

SHARE OF POPULATION 65+: 16.1%

COST OF LIVING FOR RETIREES: 5% below the national average

PER CAPITA INCOME FOR POPULATION: $35,634

TAX RATING FOR RETIREES: Tax Friendly

Although Huntsville is known for NASA’s Marshall Space Flight Center, there are plenty of other reasons is Huntsville AL a good place to retire. The space center attracts plenty of tourism, which means you’ll have your fair share of restaurants and shops nearby.

Lincoln

CITY POPULATION: 6,781

SHARE OF POPULATION 65+: 14.5%

COST OF LIVING FOR RETIREES: 7.4% below the national average

PER CAPITA INCOME FOR POPULATION: $29,784

TAX RATING FOR RETIREES: Tax Friendly

When many ask is Alabama a good place to retire, they automatically think of areas like Lincoln, home to the Talladega Superspeedway. But Lincoln is also one of the best budget retirement locations in the state, with a lower than average cost of living.

Montgomery

CITY POPULATION: 198,525

SHARE OF POPULATION 65+: 14.3%

COST OF LIVING FOR RETIREES: 8% below the national average

PER CAPITA INCOME FOR POPULATION: $28,191

TAX RATING FOR RETIREES: Tax Friendly

For military servicemembers and veterans, Montgomery is often listed in the 10 best places to retire for military for a reason. There’s a large number of VA medical care facilities in the city, including the Central Alabama Veterans Health Care System.

Birmingham

CITY POPULATION: 209,403

SHARE OF POPULATION 65+: 14.9%

COST OF LIVING FOR RETIREES: 9% below the national average

PER CAPITA INCOME FOR POPULATION: $24,480

TAX RATING FOR RETIREES: Tax Friendly

Another city with a low cost of living is Birmingham, which is often listed among the best Southern states to retire. You’ll get all the benefits of living in a highly populated town, including dining, shopping, and healthcare options.

Gulf Shores

CITY POPULATION: 12,757

SHARE OF POPULATION 65+: 23.7%

COST OF LIVING FOR RETIREES: 5% above the national average

PER CAPITA INCOME FOR POPULATION: $37,108

TAX RATING FOR RETIREES: Tax Friendly

If you don’t mind tourist traffic, Gulf Shores is one of the best beach towns to live in Alabama. There’s a thriving 65+ population, which will give you access to activities and social opportunities.

Foley

CITY POPULATION: 20,391

SHARE OF POPULATION 65+: 26.1%

COST OF LIVING FOR RETIREES: 6% below the national average

PER CAPITA INCOME FOR POPULATION: $27,078

TAX RATING FOR RETIREES: Tax Friendly

Located near Fairhope, one of the best towns to retire in, Foley has a heavy retiree population and a charming downtown historic district. It also has one of the largest outlet malls in Alabama, the Tanger Outlet Center.

Bottom Line

Those looking for a warm climate and access to historical landmarks will find Alabama good place to live in retirement. But one of the best things about Alabama is its affordability. Working with a certified financial planner through Retirable, you can come up with a customized plan that will ensure your retirement years in Alabama are comfortable and fun.

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Author

Stephanie Faris

Stephanie Faris has written about finance for entrepreneurs and marketing firms since 2013. She spent nearly a year as a writer for a credit card processing service and has written about finance for numerous marketing firms and entrepreneurs. Her work has appeared on Money Under 30, The Motley Fool, MoneyGeek, E-commerce Insiders, and GoBankingRates.

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