What’s the best place to retire in the U.S. in 2021? Your answer will probably depend on what you value, as well as what cost of living you are prepared to afford. As you’re thinking about where to retire, it’s a good idea to consider your housing needs and how they might change. If you’re an empty-nester, you may be able to downsize.

You’ll probably also want to consider climate, as well as your own preferences for outdoor and indoor activities. Another thing to consider is cost of living and tax-friendliness for seniors. A place is tax-friendly for seniors if its tax burden is relatively light, and not tax friendly if the tax burden is heavy. As you’ll see, many of the tax-friendly cities on this list are in relatively low-tax states.

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The 30 best places to retire in the U.S. in 2021

Huntsville, Alabama

CITY POPULATION: 190,501
SHARE OF POPULATION 65+: 15.2%
COST OF LIVING FOR RETIREES: 6.1% below the national average
AVERAGE INCOME FOR POPULATION 65+: $51,853
STATE'S TAX RATING FOR RETIREES: Tax Friendly

Alabama is not usually what people think of when they think about top places to retire, but Huntsville makes a good case for reconsidering Alabama. For one thing, the cost of living is cheap. Perhaps not surprisingly, it’s also tax-friendly. The city also has a highly-educated population, a lively cultural scene, and the usual Alabama advantages of warm weather, beaches, and golf.

Anchorage, Alaska

CITY POPULATION: 298,225
SHARE OF POPULATION 65+: 9.4%
COST OF LIVING FOR RETIREES: 26.8% above the national average
AVERAGE INCOME FOR POPULATION 65+: $70,291
STATE'S TAX RATING FOR RETIREES: Most Tax Friendly

Anchorage offers an incredible combination of northern wilderness and urban attractions. The city has no shortage of theaters and museums. It’s also very tax-friendly, and the state uses the oil wealth to pay all residents a dividend. The amount varies year by year; according to the most recent data in 2018 it was $1,600.00, up from $1,100.00 in 2017.

Now, yes, Anchorage does also mean cold winters and higher cost of living. However, if those aren’t dealbreakers, it should rank high on your list of retirement cities.

Fayetteville, Arkansas

CITY POPULATION: 81,889
SHARE OF POPULATION 65+: 9.1%
COST OF LIVING FOR RETIREES: 13.8% below the national average
AVERAGE INCOME FOR POPULATION 65+: $85,436
STATE'S TAX RATING FOR RETIREES: Not Tax Friendly

Fayetteville is a modest-sized Southern metropolis with access to the Ozarks. If you stay in town, there is a lively music and arts scene – and since this is Arkansas, it includes the Walton Arts Center.

Fayetteville is admittedly not a tax-friendly location. However, the low cost of living and the fact that it was voted 11th for community well-being on Gallup’s Well-Being Index earns it a place in any discussion about where to do retirement in the USA.

Carlsbad, California

CITY POPULATION: 113,147
SHARE OF POPULATION 65+: 16.0%
COST OF LIVING FOR RETIREES: 40.6% above the national average
AVERAGE INCOME FOR POPULATION 65+: $70,348
STATE'S TAX RATING FOR RETIREES: Not Tax Friendly

If Southern California appeals to you, Carlsbad should rank highly in your list of possible answers about where to retire.

Carlsbad is part of the San Diego metropolitan area, meaning there’s plenty of Southern California sun and beaches. At the same time, it’s small enough to still be charming. If you can deal with the high cost of living and the relatively high taxes, Carlsbad should go on your list of good places to retire.

Denver, Colorado

CITY POPULATION: 678,467
SHARE OF POPULATION 65+: 11.2%
COST OF LIVING FOR RETIREES: 9.4% above the national average
AVERAGE INCOME FOR POPULATION 65+: $59,601
STATE'S TAX RATING FOR RETIREES: Mixed

Denver is located in Colorado, meaning opportunities for outdoor activities are numerous. If you enjoy mountains and forested landscapes, Denver may be for you. The city is also plenty large enough to support a thriving cultural scene. It is even well-known for its high-quality nursing homes.

Milford, Delaware

CITY POPULATION: 10,654
SHARE OF POPULATION 65+: 19.7%
COST OF LIVING FOR RETIREES: n/a
AVERAGE INCOME FOR POPULATION 65+: n/a
STATE'S TAX RATING FOR RETIREES: Tax Friendly

Delaware has something of a reputation for beach towns, making it a desirable location for retirement in the USA. However, most of these towns tend to be a bit on the expensive side.

Enter Milford. This town is small, and the cost of living is about at the national average. The beach is about a 15-minute drive away. The downtown has restaurants and boutiques, the Milford Museum and the Riverfront Theater.

Cape Coral, Florida

CITY POPULATION: 173,679
SHARE OF POPULATION 65+: 21.9%
COST OF LIVING FOR RETIREES: 2.4% below the national average
AVERAGE INCOME FOR POPULATION 65+: $42,123
STATE'S TAX RATING FOR RETIREES: Most Tax Friendly

Florida is a retirement magnet for good reason: the climate is warm, and there are numerous attractions. Cape Coral emblemizes this, with its waterway access for boating, fishing, and water sports coupled with plenty of beaches, golfing, and other recreational opportunities. All of this, and it’s exceptionally tax friendly to boot.

Augusta, Georgia

CITY POPULATION: 196,899
SHARE OF POPULATION 65+: 12.8%
COST OF LIVING FOR RETIREES: 9.5% below the national average
AVERAGE INCOME FOR POPULATION 65+: $44,141
STATE'S TAX RATING FOR RETIREES: Most Tax Friendly

Augusta, Georgia combines Southern hospitality with low living costs and a very advantageous tax situation for seniors. The city is famous for the Masters golf tournament, and the downtown is walkable and attractive, with restaurants, museums, galleries, and nightlife. Outdoor attractions include running, walking, and biking, as well as kayaking and boating. The Augusta Canal and the Savannah River are both popular waterways.

Hilo, Hawaii

CITY POPULATION: 45,703
SHARE OF POPULATION 65+: 18.5%
COST OF LIVING FOR RETIREES: 36.4% above the national average
AVERAGE INCOME FOR POPULATION 65+: $54,503
STATE'S TAX RATING FOR RETIREES: Tax Friendly

Hilo is on the Big Island of Hawaii, and it showcases all the reasons Hawaii is so enviable as a retirement destination. A tropical island with rainforests, waterfalls, and the Mauna Loa volcano means the outdoor opportunities are fantastic. The downtown and waterfront have galleries, shops, restaurants, and the ‘Imiloa Astronomy Center. The cost of living is much higher here than the national average, but if you can get past that, Hilo is a tropical island paradise destination for your retirement.

Idaho Falls, Idaho

CITY POPULATION: 59,414
SHARE OF POPULATION 65+: 12.9%
COST OF LIVING FOR RETIREES: 8.3% below the national average
AVERAGE INCOME FOR POPULATION 65+: $42,795
STATE'S TAX RATING FOR RETIREES: Mixed

Idaho Falls offers incredible freshwater fishing opportunities. Both the Henry’s Fork and the South Fork of the Snake River are nearby, veritable meccas to anglers and other outdoors enthusiasts. Restaurants, shops, art installations, and the Museum of Idaho offer plenty of cultural life.

Peoria, Illinois

CITY POPULATION: 115,424
SHARE OF POPULATION 65+: 14.3%
COST OF LIVING FOR RETIREES: 5.9% below the national average
AVERAGE INCOME FOR POPULATION 65+: $53,116
STATE'S TAX RATING FOR RETIREES: Mixed

Peoria, Illinois is very affordable, particularly for seniors. The nearby Peoria Park District has 64 park sites and plenty of opportunities for golfing, experiencing nature, and more. The downtown is a vibrant cultural scene of eateries, shops, and attractions.

Fort Wayne, Indiana

CITY POPULATION: 262,450
SHARE OF POPULATION 65+: 13.4%
COST OF LIVING FOR RETIREES: 11.5% below the national average
AVERAGE INCOME FOR POPULATION 65+: $47,848
STATE'S TAX RATING FOR RETIREES: Least Tax Friendly

While Fort Wayne is not tax friendly, it is affordable and offers a metro area with a thriving arts scene. It is particularly known for the Three Rivers Festival in the summertime, named after the three local rivers: the St. Marys, the St. Joseph, and the Maumee. Outdoor activities abound, with over 80 parks.

Des Moines, Iowa

CITY POPULATION: 214,778
SHARE OF POPULATION 65+: 11.7%
COST OF LIVING FOR RETIREES: 9.4% below the national average
AVERAGE INCOME FOR POPULATION 65+: $48,740
STATE'S TAX RATING FOR RETIREES: Not Tax Friendly

Des Moines offers big city living at affordable prices. The cultural life is rich, and includes an outdoor sculpture park, botanical gardens, and a zoo. Nearby Altoona has the interesting spectacle of camel, ostrich, and zebra races. Des Moines also has plenty of healthcare facilities with an emphasis on aging-related services.

Manhattan, Kansas

CITY POPULATION: 55,427
SHARE OF POPULATION 65+: 8.2%
COST OF LIVING FOR RETIREES: 8.4% below the national average
AVERAGE INCOME FOR POPULATION 65+: n/a
STATE'S TAX RATING FOR RETIREES: Least Tax Friendly

Known as the Little Apple, Kansas’s version of Manhattan is far more affordable than its New York namesake. It also has a trail system with plenty of opportunities for walking and biking. The university offers courses year-round, with a special focus on encouraging lifelong learning in seniors.

Lexington, Kentucky

CITY POPULATION: 315,109
SHARE OF POPULATION 65+: 12.2%
COST OF LIVING FOR RETIREES: 6.6% below the national average
AVERAGE INCOME FOR POPULATION 65+: $61,323
STATE'S TAX RATING FOR RETIREES: Most Tax Friendly

If you love the outdoors, Lexington may be for you. There are over 100 parks, not to mention 5 public golf courses and a nature preserve. The city is also home to the Lexington Opera House, which has plenty of ballets, Broadway musicals, and comedy as well as operas.

Lafayette, Louisiana

CITY POPULATION: 126,476
SHARE OF POPULATION 65+: 13.1%
COST OF LIVING FOR RETIREES: 8.3% below the national average
AVERAGE INCOME FOR POPULATION 65+: $64,729
STATE'S TAX RATING FOR RETIREES: Tax Friendly

Lafayette is known as the Cajun Capital City because of its historic association with Cajun French culture. Culturally, this means plenty of great food, history, and music. At the same time, the city is located on the Mississippi Flyway, meaning plenty of opportunities for birding as well as access to rivers, bayous, and swamps.

Portland, Maine

CITY POPULATION: 66,715
SHARE OF POPULATION 65+: 13.7%
COST OF LIVING FOR RETIREES: 17.1% above the national average
AVERAGE INCOME FOR POPULATION 65+: $44,769
STATE'S TAX RATING FOR RETIREES: Mixed

If the Northeast appeals, Portland, Maine, may be the ideal retirement destination. It combines museums, theaters, and fine dining with easy access to the beaches and outdoors. Maine is known for its outdoor recreation activities, and Portland is an excellent place for retirees who enjoy fishing, kayaking, and other outdoor pursuits.

Pittsfield, Massachusetts

CITY POPULATION: 43,289
SHARE OF POPULATION 65+: 19.0%
COST OF LIVING FOR RETIREES: 7.9% above the national average
AVERAGE INCOME FOR POPULATION 65+: $58,231
STATE'S TAX RATING FOR RETIREES: Not Tax Friendly

Pittsfield offers a New England experience as picturesque as any, but at relatively affordable prices by New England standards. In addition to the gorgeous colors of autumn, Pittsfield has camping, fishing, hiking, and skiing. The cultural life includes the Tanglewood Music Center, famous as the Boston Symphony Orchestra’s summer home.

Ann Arbor, Michigan

CITY POPULATION: 119,303
SHARE OF POPULATION 65+: 11.3%
COST OF LIVING FOR RETIREES: n/a
AVERAGE INCOME FOR POPULATION 65+: $82,971
STATE'S TAX RATING FOR RETIREES: Not Tax Friendly

Ann Arbor is famous as a college town, thanks to the University of Michigan. The university includes the Osher Lifelong Learning Institute, as well as the Geriatrics Center & Institute of Gerontology. Suffice it to say, this is a senior-friendly town.

Mankato, Minnesota

CITY POPULATION: 41,241
SHARE OF POPULATION 65+: 11.0%
COST OF LIVING FOR RETIREES: 4.4% below the national average
AVERAGE INCOME FOR POPULATION 65+: n/a
STATE'S TAX RATING FOR RETIREES: Least Tax Friendly

Mankato is a small city on the rise, and that means a thriving downtown with plenty of shops and entertainment. While the cold Minnesota winters and the unfavorable tax situation may be a challenge for some, the city offers a small-town Midwestern vibe.

Jackson, Mississippi

CITY POPULATION: 170,393
SHARE OF POPULATION 65+: 11.6%
COST OF LIVING FOR RETIREES: 10% below the national average
AVERAGE INCOME FOR POPULATION 65+: $47,876
STATE'S TAX RATING FOR RETIREES: Most Tax Friendly

Jackson, Mississippi offers an eclectic cultural and historical mix. This city is simultaneously a mecca for enthusiasts of Civil War history, blues music, and ballet. The USA International Ballet Competition is held here every four years.

The city is also very highly ranked by the Milken Institute for successful aging, due to an abundance of healthcare professionals and affordable costs.

Kansas City, Missouri

CITY POPULATION: 476,974
SHARE OF POPULATION 65+: 12.4%
COST OF LIVING FOR RETIREES: 3.7% below the national average
AVERAGE INCOME FOR POPULATION 65+: $47,657
STATE'S TAX RATING FOR RETIREES: Mixed

Kansas City is famous for jazz: it is the home of Charlie Parker and the American Jazz Museum. It also has plenty of other cultural attractions, including the Nelson-Atkins Museum of Art. Seniors who enjoy music and culture might want to consider this area for retirement.

Bozeman, Montana

CITY POPULATION: 43,132
SHARE OF POPULATION 65+: 8.6%
COST OF LIVING FOR RETIREES: 3.2% above the national average
AVERAGE INCOME FOR POPULATION 65+: n/a
STATE'S TAX RATING FOR RETIREES: Not Tax Friendly

Bozeman, Montana is perfect for people who have always dreamed of more mountains. The city is located in the Gallatin Valley, and that means mountains and forests. Both the Yellowstone and Grand Teton national parks are directly south. If you’ve never been able to get enough wilderness, consider Bozeman high on your list of places to retire.

Reno, Nevada

CITY POPULATION: 239,732
SHARE OF POPULATION 65+: 13.8%
COST OF LIVING FOR RETIREES: 10.4% above the national average
AVERAGE INCOME FOR POPULATION 65+: $51,061
STATE'S TAX RATING FOR RETIREES: Most Tax Friendly

Reno bills itself as the Biggest Little City in the World, and it’s not hard to see why: it has no shortage of restaurants, nightclubs, art galleries, and more. If you love gambling and/or the cultural life, this is the place for you. At the same time, the Sierra Nevada mountain range and Lake Tahoe are close by for outdoor enthusiasts.

Laconia, New Hampshire

CITY POPULATION: 16,237
SHARE OF POPULATION 65+: 20.5%
COST OF LIVING FOR RETIREES: 1.2% below the national average
AVERAGE INCOME FOR POPULATION 65+: n/a
STATE'S TAX RATING FOR RETIREES: Most Tax Friendly

Laconia is relatively affordable and offers the unbelievable recreation opportunities of the Granite State. The city is located between Lake Winnipesaukee and Winnisquam Lake, and that means abundant outdoor recreation. Seniors who love the Northeast and the outdoors and low taxes may want to consider Laconia.

Albuquerque, New Mexico

CITY POPULATION: 556,718
SHARE OF POPULATION 65+: 14.2%
COST OF LIVING FOR RETIREES: 3.1% below the national average
AVERAGE INCOME FOR POPULATION 65+: $49,684
STATE'S TAX RATING FOR RETIREES: Least Tax Friendly

If you enjoy the Southwest, with its abundant sun and relatively mild winters, Albuquerque, New Mexico offers a winning combination of outdoor activities and cultural life. Hiking and biking are both common, and the mountains are nearby. There are also casinos, concert venues, and much more.

Phoenix, Arizona

CITY POPULATION: 1.6 million
SHARE OF POPULATION 65+: 10.0%
COST OF LIVING FOR RETIREES: 1% below the national average
AVERAGE INCOME FOR POPULATION 65+: $54,681
STATE'S TAX RATING FOR RETIREES: Mixed

Arizona is a state that may come up if you look for the best places for retired people to live. Between the jaw-dropping natural beauty, mild winters, and the opportunities for outdoor recreation, it’s not hard to see why the Grand Canyon State is one of the best states to retire.

The city of Phoenix combines easy access to the outdoors with a high-quality urban vibe. There are world-class restaurants and no shortage of museums and theaters.

Charlottesville, Virginia

CITY POPULATION: 46,487
SHARE OF POPULATION 65+: 10.4%
COST OF LIVING FOR RETIREES: 0.2% below the national average
AVERAGE INCOME FOR POPULATION 65+: n/a
STATE'S TAX RATING FOR RETIREES: Tax Friendly

Charlottesville, Virginia brings Southern charm and a university town vibe together. The city’s University of Virginia was founded by no less than Thomas Jefferson, and there is a lively local art scene. At the same time, the surrounding area offers plenty of opportunities for experiencing the outdoors, including access to the Appalachian Trail in Shenandoah National Park.

Richland, Washington

CITY POPULATION: 53,991
SHARE OF POPULATION 65+: 15.5%
COST OF LIVING FOR RETIREES: 1.7% below the national average
AVERAGE INCOME FOR POPULATION 65+: $70,059
STATE'S TAX RATING FOR RETIREES: Tax Friendly

Richland, Washington offers access to the great outdoors and to wine country. The Columbia River, Yakima River, and Snake River are all close by if you enjoy boating or fishing. The Sacagawea Trail offers plenty of opportunities for hiking. And if wine country is your preference, you can visit more than 200 wineries within a distance of 50 miles.

Cheyenne, Wyoming

CITY POPULATION: 62,986
SHARE OF POPULATION 65+: 15.3%
COST OF LIVING FOR RETIREES: 8.7% below national average
AVERAGE INCOME FOR POPULATION 65+: $44,323
STATE'S TAX RATING FOR RETIREES: Most Tax Friendly

If you’re looking for a community in a state known for its rugged, almost Old West frontier feel, Cheyenne, Wyoming may be the perfect place for you. This city is famous for hosting the 10-day-long outdoor rodeo and Western celebration, Frontier Days. The countryside is also full of opportunities for outdoor activities, including hiking, horseback riding, fishing, boating, and more.

Bottom Line

Your best place to retire will likely depend on a combination of factors, including what you value and what your assets are. If you need less space, it’s a good idea to think about downsizing. If you are on a budget, it’s a good idea to think about retirement destinations that are tax-friendly and have a lower cost of living than the national average. No matter your situation, it’s a good idea to talk to a Certified Financial Planner® to see what your options are and any options for optimizing your tax situation and your retirement.