There are a lot of factors to consider when deciding where to settle down in retirement.
No matter your retirement dreams, we think you should also consider thefinancial ramificationsof your move.
Thats why we put together a list of the best states for retirement.
All Smart Credit Card Users:
Debt can get out of control fast.
(Inflation, amiright?)
That doesnt mean you have to let your debt run your life.
Taxes
Taxes have one of the biggest impacts on your retirement savings longevity.
First off, if youre wondering if you pay taxes on retirement incomes, the answer is yes.
According tothe IRS, most retirement accounts count as taxable income.
Social Security is also taxed on the federal level depending on your income.
Depending on each states laws, your tax paymentswill vary greatly.
For example, youll pay nothing on your annual retirement income to the state of Texas.
Many of these states have high property taxes to recoup revenue forgone by not taxing income.
There are many states that are labeled retirement friendly even with state income tax.
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Again, just because your desired state isnt on this list doesnt mean its a no-go.
It just means you might have to save more now or budget more later.
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If it’s crucial that you wrangle your budget, it may be time to consider a savings challenge.
However, it can sometimes feel overwhelming looking at the data alone.
In addition, Mississippi is a good place for your heirs because there is no estate or inheritance tax.
Arkansas
Its Arkansass low cost of living that makes it one of the best states for retirement.
Arkansas also offers no taxes on social security, low property taxes and relatively low state income tax.
Tennessee
Tennessee offers retirees no state income taxes to speak of.
No matter how youre preparing for retirement, you wont be taxed when you pull out your savings.
It also has low property taxes and low housing costs.
It has no social security tax or estate or inheritance taxes.
While sales taxes are high, groceries are exempt from it, and property taxes are low.
Combined with the overall low house prices, its pretty affordable overall.
Plus, what you are taxed might not be that much.
Oklahomas state income tax begins at just .25% and only goes as high as 4.75%.
It also ranks well in cost of living, stealing the second spot overall.
Are You Ready to Go?
We simply think any choice should be a financially informed one.
Above all, we hope you might glide into your golden years financially prepared.
Contributor Whitney Hansen covers banking, credit cards and investing for The Penny Hoarder.
She also writes on other personal finance topics.
