The 10 Best and Most Affordable Places in the US to Retire on Social Security

The retirement years bring more time to enjoy being at home or out in the community, and also a newfound geographical freedom. No longer tied to a workplace, retirees may decide that the time is right to go wherever their hearts lead them.

Some look to warmer weather, or to their favorite environment: the beach, the desert, or the mountains. Others want to live closer to family or to activity opportunities in their favorite city.

But for most Americans, the increase in free time comes with a decrease in budget. Half of seniors rely on Social Security for more than 50 percent of their income; one quarter rely on it for more than 90 percent.

How much is that, exactly? According to ssa.gov, the average Social Security payment in 2020 is around $1,503 per month, with a maximum benefit of $3,011 per month.

AARP’s Livability Index evaluates how desirable a city is for retirement according to 60 criteria, giving a broad perspective on quality of life. But reliance on Social Security puts some of the top-rated cities well out of reach. Among AARP’s top 10 large cities are Boston, New York City, San Francisco, Seattle and Washington, D.C.— some of the most expensive cities in the country.

Here we will explore some great cities where your fixed income will go much further. These cities have plenty of appeal at the right price. Below are 10 best and most affordable cities in the US to retire on social security.

1. Rochester, Minnesota

Rochester has a lot to offer retirees, not least of which is their world-renowned Mayo Clinic. The 2019 Healthgrades National Health Index lists Rochester as the number one city in the U.S. for healthcare, and USA Today placed it first among its 30 Best Cities for Older Americans.

Warm locations get more attention as retirement destinations, but for those who love all four seasons, Rochester is a good bet. It’s close enough to the Twin Cities of Minneapolis and Saint Paul for visitors to make the drive, but has a lower cost of living and easier-to-navigate size.

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2. Huntsville, Alabama

If you like the heat and a laid-back vibe, Huntsville may be your place. Ranking number one in U.S. News & World Report’s The 25 Best Affordable Places to Live in the U.S. in 2019, this medium-sized city offers an assortment of affordable housing options.

Space and military buffs will enjoy their proximity to the Marshall Space Flight Center and U.S. Army Aviation and Missile Command.

3. Orlando, Florida

DisneyWorld isn’t the only attraction in Orlando (though it sure won’t hurt your reputation with the grandkids). Wallethub.com ranked Orlando number one overall in their 2019 list of Best & Worst Places to Retire.

The sunshine and reasonable cost of living in Orlando have led to the development of a large number of senior housing communities. Many retirees find these communities offer excellent social opportunities.

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4. Laredo, Texas

In 2020, Business Insider published 17 US cities where retirement is affordable, taxes are reasonable, and healthcare costs less. Topping the list was Laredo, Texas. Laredo is the 3rd largest U.S. city on the Mexican border, with a population around 250,000.

The border location offers proximity to Mexican culture without the challenges of retiring in a different country. For those comfortable with road trips, San Antonio, the Gulf coast, and Monterrey, Mexico can all be reached in under three hours (excluding border crossing).

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5. Mesa, Arizona

Arizona is a perennial favorite among retirees for its dry heat and beautiful scenery. Mesa, a small city just east of Phoenix, is seeing a big boom in its retiree population. According to SmartAsset.com’s Top 10 Cities Where Retirees Are Moving – 2020 Edition, Mesa has the highest net increase in retirees, meaning the largest number of new residents over 60 compared to the number who’ve moved away.

In addition to all Phoenix has to offer, residents of Mesa have easy access to the Tonto National Forest and the Superstition Mountains.

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6. Harlingen, Texas

In The Motley Fool’s list of the 10 Cities Where Your Social Security Benefit Goes the Furthest, Harlingen, TX took the top spot. The cost of living in Harlingen is 24.2% below the average in the United States.

Located in the Rio Grande Valley and approximately 30 miles from the Gulf of Mexico, Harlingen is a small city with a small price tag to match.

7. Madison, Wisconsin

Forbes rated this lake-framed city number one among its 25 Best Cities for an Active Retirement. Madison ranks very highly in the percentage of adults who volunteer, and it offers excellent biking and paddling opportunities.

The University of Wisconsin-Madison is a hub for lifelong education and arts. As a bonus, Madison ranks well for its public transportation and also has the highest number of doctors per capita in the country.

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8. Wichita Falls, Texas

Texas draws many retirees each year with its weather, affordability and attractions. Business Insider listed the small city of Wichita Falls, northwest of Dallas/Fort Worth, number one in 2020 among The 25 US Cities with the Lowest Cost of Living.

Attractions in Wichita Falls include Lake Wichita and Lucy Park. An artificially constructed waterfall pays tribute to the original falls after which the town was named.

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9. Portland, Maine

Many towns in the Northeast have high costs of living to balance out their high quality of life, but Portland, Maine is among the most affordable. The waterfront is a big draw to retirees in Portland. The fishing industry means an abundance of fresh seafood, and there are sand beaches and lakes nearby.

With a median housing price of $202,800, according to AARP, Portland is within reach for many who lean on social security for income.

A modest retirement income doesn’t have to mean a spartan lifestyle. These are just a few of the many locations where your money can go farther, while offering good health care, scenery, social opportunities and more.

10. Anchorage, Alaska

If your goal in retirement is to live in the place with the lowest tax burden, you may want to explore Anchorage. SmartAsset.com named it number one in their list of the lowest-tax cities.

With no income tax and no sales tax, residents of Anchorage pay about 8.2 percent of their pre-tax income to taxes, including real estate, state and local.

Seniors have an even better deal, qualifying for an exemption in which no property taxes are due on the first $150,000 of value in their homes.

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