Social Security

15 Best Cities to Retire in California in 2021

One of the best things about retiring within California is that no matter where you live, you’re just hours from a variety of travel experiences.

Stephanie Faris

Published March 9th, 2021

Table of Contents

Key Takeaways

  • As the most populous state in the U.S., California has a lot to offer retirees.
  • The cost of living across the state is higher than the national average, but there are areas where you can find affordable housing and cheaper amenities.
  • The state’s so diverse, it’s important to narrow down the type of community you’re seeking, whether it’s coastal living, a city rich in history, or a more suburban lifestyle.

California isn’t exactly known for its affordable cost of living. But one of the best things about retiring within the state is that no matter where you live, you’re just hours from a variety of travel experiences. California doesn’t tax Social Security income, but other forms of retirement income will be taxed, making it less than stellar when it comes to tax friendliness. But despite its high cost of living, California retirement doesn’t have to break the bank. Here are some cities that are retirement-friendly, some of which are even somewhat affordable.

San Diego

San Diego

  • CITY POPULATION: 1,423,851
  • SHARE OF POPULATION 65+: 12.6%
  • COST OF LIVING FOR RETIREES: 44% above the national average
  • PER CAPITA INCOME FOR POPULATION: $41,112
  • TAX RATING FOR RETIREES: Not tax friendly

A warm year-round climate and access to everything you could possibly need put San Diego at the top of the list of best places to retire in California. You can find 55-plus communities, swanky condos, or a house to fit your lifestyle. You’ll also have access to a robust healthcare system, with a wide range of medical facility types.

Redondo Beach

Redondo Beach

  • CITY POPULATION: 66,749
  • SHARE OF POPULATION 65+: 13.2%
  • COST OF LIVING FOR RETIREES: 75% above the national average
  • PER CAPITA INCOME FOR POPULATION: $62,528
  • TAX RATING FOR RETIREES: Not tax friendly

Beach living is typically more expensive, and Redondo Beach is no exception. But you’ll get shopping, dining, and plenty of culture. What makes Redondo Beach one of the best retirement communities in California, though, is its private slip harbor, making it ideal for boaters.

Los Gatos

Los Gatos

  • CITY POPULATION: 30,222
  • SHARE OF POPULATION 65+: 20.8%
  • COST OF LIVING FOR RETIREES: 138% above the national average
  • PER CAPITA INCOME FOR POPULATION: $87,111
  • TAX RATING FOR RETIREES: Not tax friendly

Located in an area of the state known as “South Bay,” Los Gatos has plenty to offer retirees. It’s one of the best cities to retire in California because of its access to healthcare and warm climate. You’ll also have your choice of activities, from the arts to outdoor recreation.

Sacramento

Sacramento

  • CITY POPULATION: 466,383
  • SHARE OF POPULATION 65+: 13.1%
  • COST OF LIVING FOR RETIREES: 17% above the national average
  • PER CAPITA INCOME FOR POPULATION: $31,956
  • TAX RATING FOR RETIREES: Not tax friendly

For boomers, California can be pricey, but Sacramento is among the most affordable towns in the state. Sacramento is rich with history, including cobblestone streets and historic buildings. You’ll also get all the amenities of suburban life, including dining, shopping, and access to healthcare.

Santa Clarita

Santa Clarita

  • COUNTY POPULATION: 212,979
  • SHARE OF POPULATION 65+: 11.7%
  • COST OF LIVING FOR RETIREES: 44% above the national average
  • PER CAPITA INCOME FOR POPULATION: $39,639
  • TAX RATING FOR RETIREES: Not tax friendly

Like other best places to retire on the west coast, Santa Clarita is valuable for its history and culture. It’s part of the Santa Clarita Valley, located just a short drive from Los Angeles, but you’ll have everything you need in town.

Los Angeles

Los Angeles

  • CITY POPULATION: 10,039,107
  • SHARE OF POPULATION 65+: 14.1%
  • COST OF LIVING FOR RETIREES: 43% above the national average
  • PER CAPITA INCOME FOR POPULATION: $34,156
  • TAX RATING FOR RETIREES: Not tax friendly

Plenty has been written about the “City of Dreams,” mostly because of the city’s entertainment industry. But if you’re looking at retirement, California’s best-known city is worth consideration. The diverse population and mild temperatures make it a great place to live no matter your age.

Newport Beach

Newport Beach

  • CITY POPULATION: 84,534
  • SHARE OF POPULATION 65+: 23.1%
  • COST OF LIVING FOR RETIREES: 35% above the national average
  • PER CAPITA INCOME FOR POPULATION: $95,404
  • TAX RATING FOR RETIREES: Not tax friendly

For a slightly larger over-65 population, there’s Newport Beach. Often when people research where to retire in California, Newport Beach tops the list for its access to healthcare and activities. If you like beachfront living, this will probably be one of the more affordable options.

Santa Barbara

Santa Barbara

  • CITY POPULATION: 91,364
  • SHARE OF POPULATION 65+: 18.7%
  • COST OF LIVING FOR RETIREES: 47.6% above the national average
  • PER CAPITA INCOME FOR POPULATION: $46,236
  • TAX RATING FOR RETIREES: Not tax friendly

Another coastal city is Santa Barbara. History and culture, as well as access to beautiful beaches, make this one of the best retirement communities in California. The Spanish history is evident in many of the buildings throughout the city.

San Luis Obispo

San Luis Obispo

  • CITY POPULATION: 283,111
  • SHARE OF POPULATION 65+: 20.9%
  • COST OF LIVING FOR RETIREES: 59% above the national average
  • PER CAPITA INCOME FOR POPULATION: $37,233
  • TAX RATING FOR RETIREES: Not tax friendly

Another city rich with Spanish architecture is San Luis Obispo. But what makes it one of the places to retire in California is its warm weather, coastal location, and breathtaking views.

Salinas

Salinas

  • CITY POPULATION: 155,465
  • SHARE OF POPULATION 65+: 8.9%
  • COST OF LIVING FOR RETIREES: 17% above the national average
  • PER CAPITA INCOME FOR POPULATION: $21,504
  • TAX RATING FOR RETIREES: Not tax friendly

Salinas is known for its massive farming industry, which means miles of greenery. You’ll find horse farms and vineyards in the area to add to the overall aesthetic. The mild climate promotes plenty of outdoor events throughout the year, so you’ll never be bored.

Visalia

  • CITY POPULATION: 134,605
  • SHARE OF POPULATION 65+: 11.5%
  • COST OF LIVING FOR RETIREES: 12% above the national average
  • PER CAPITA INCOME FOR POPULATION: $27,533
  • TAX RATING FOR RETIREES: Not tax friendly

For a suburban feel, there’s Visalia, which has a lower cost of living than many other California cities. There are plenty of parks, shops, and restaurants, so you’ll have everything you need.

Riverside

Riverside

  • CITY POPULATION: 331,360
  • SHARE OF POPULATION 65+: 10.7%
  • COST OF LIVING FOR RETIREES: 21% above the national average
  • PER CAPITA INCOME FOR POPULATION: $26,028
  • TAX RATING FOR RETIREES: Not tax friendly

With plenty of active adult communities and a warm climate, Riverside is a great option for those wanting to retire to Southern California. What really sets the town apart, though, is its thriving healthcare services industry.

Palm Springs

Palm Springs

  • CITY POPULATION: 48,518
  • SHARE OF POPULATION 65+: 31.7%
  • COST OF LIVING FOR RETIREES: 22% above the national average
  • PER CAPITA INCOME FOR POPULATION: $45,641
  • TAX RATING FOR RETIREES: Not tax friendly

Retirees often choose Palm Springs as a more affordable alternative to L.A. That gives it a higher than average population of older adults, which makes it one of the best retirement communities in Southern California.

San Jose

San Jose

  • CITY POPULATION: 1,021,795
  • SHARE OF POPULATION 65+: 12.5%
  • COST OF LIVING FOR RETIREES: 49% above the national average
  • PER CAPITA INCOME FOR POPULATION: $46,599
  • TAX RATING FOR RETIREES: Not tax friendly

Its close proximity to Silicon Valley makes San Jose an in-demand area. That means you’ll have access to all the amenities you could possibly need, but it also brings a high cost of living.

Costa Mesa

Costa Mesa

  • CITY POPULATION: 113,003
  • SHARE OF POPULATION 65+: 11.3%
  • COST OF LIVING FOR RETIREES: 35.8% above the national average
  • PER CAPITA INCOME FOR POPULATION: $41,136
  • TAX RATING FOR RETIREES: Not tax friendly

A year-round warm climate and close proximity to beaches make Costa Mesa one of the top retirement communities in California. Although the cost of living is high, there are affordable housing options available, including multiple 55-plus communities.

Bottom Line

If you’re calculating how much do you need to retire in California, it’s important to first know the cost of living where you’re going. The state is large and full of variety, so one city won’t bring the same options as another. Once you’ve identified your favorite future home, it’s important to sit down with a Certified Financial Planner® to make sure you’re setting enough aside.

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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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