I’m a Financial Planner: 5 Popular Retirement Destinations You Should Avoid
Written by
Laura Gariepy
Edited by
Joe Evans
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Your retirement plan has to answer many questions, with the most important one being: Where am I going to live? You might chat with current retirees or research popular destinations to help you decide.
Top retirement cities for baby boomers currently include Las Vegas, Phoenix, Tampa, Orlando and Austin. However, relying on what the crowd thinks (or, rather, where it goes) may not be a wise move. In fact, relocating to one of the most common retirement locales could result in financial disaster.
GOBankingRates spoke with a few financial experts to get their takes on the popular retirement destinations you should actively avoid — and why. We’ll also share some budget-friendly yet fulfilling alternatives you can explore.
California
California has an understandable appeal. The state features warm weather and breathtaking vistas. However, Brian Thorp, founder and CEO of Wealthtender, thinks you should take it out of the running.
“While California is a beautiful state to visit,” he said, “retirees should consider the high costs of housing, dining out and parking in many of the most popular coastal areas. Especially for seniors living on a fixed income, choosing a lower-cost location further inland or a different state altogether could provide greater flexibility in their budget to enjoy getting out and about more often.”
Florida
When you think of retirement, you may envision Florida’s beaches and palm trees. You might also like the idea of not paying state income taxes.
If that’s the case, you’re not alone. Miranda Marquit, consumer advocate and spokesperson for HireAHelper, a moving company, said, “According to the most recent HireAHelper retirement moves survey, one of the most popular destinations for retirees remains Florida, specifically the Miami-Ft. Lauderdale area.”
However, Jeff Rose, certified financial planner and founder of Good Financial Cents, said Florida, “might not always live up to the hype for retirees. While [the state offers] great weather, the cost of living can be surprisingly high. It’s reported that the cost of living in Florida is $50,689 per person. Compare that to Missouri, which is only $23,484. Top that [off] with hurricanes or extreme heat, and that doesn’t sound like a relaxing retirement.”
Marquit acknowledges the financial hurdles retirees may face if they move to the Sunshine State on a limited budget.
“While cheaper than, say, California, the cost of living is still rising in Florida,” she said. “Our survey found that people moving to Miami are those with resources. They had good pensions and a lot of assets.”
Arizona
Rose thinks Arizona is also overrated. While retirees may flock to the desert to escape the cold, it could cost them a lot of their nest egg to do so.
According to the Missouri Economic Research and Information Center, Arizona ranks 36 out of 51 (including Washington, D.C.) on the 2023 overall annual cost-of-living index. The state’s housing costs are among the highest in the nation, with expenses still on the rise.
Asheville, NC
Emily Guy Birken, author of “The Five Years Before You Retire,” gets ultra-specific on where you shouldn’t spend your golden years.
“Asheville, North Carolina, is a beautiful little town that has consistently been named as one of the best places to retire, in part because it was supposed to be a hidden gem,” she said. “But it’s no longer hidden, and the cost of living there has greatly increased since it was first touted as a good retirement destination. I believe that any place that is named a ‘retirement destination’ is already over-hyped.”
Belize
If you’re considering retiring abroad, you may want to rethink Belize.
Ben Halliwell, founder of F.P. Collaborators LLC, said Belize has much to offer adventurous retirees. For instance, the nation’s primary language is English, and you can use the U.S. dollar in most locations.
However, your medical care options may be limited. Halliwell advised, “Skilled healthcare should be sought either in Mexico or back in the U.S.”
Plus, because Belize has been an independent nation only since 1981, the country’s infrastructure isn’t as sophisticated as other international retirement destinations.
Alternative Places To Retire
“South Carolina might make an attractive choice,” Marquit said. “It was the second-most popular state on our list. Its cost of living is lower than Florida’s, and it has a variety of activities and mild weather. Other popular states include Tennessee, Texas and North Carolina.
“One big surprise was that New Jersey was the third-most-popular state for retirees to move to. Many of those moving to New Jersey moved from New York, giving them a lower cost of living but still providing proximity to that city vibe.”
However, if you plan to live out your golden years on a tight budget, you may want to explore the best cities to retire on $3,000 or less per month. Interestingly, seven out of the top 10 are in Ohio.
If you’d rather move to a new country, there are several affordable retirement destinations in Asia. Your dollar could stretch further in cities such as Kyoto, Japan, Da Nang, Vietnam or Cebu, Philippines.
Tips for Choosing Where To Retire
Birken offered this advice to pending retirees: “If you don’t have a specific location in mind for retirement … don’t try to find a place to retire based on ‘best of’ lists. Instead, try to find a location that fits your needs in the following categories:
- Weather
- Proximity to family/friends
- Proximity to an airport/other transportation
- Local attractions
- Healthcare options
- Local transportation options
“For one retiree, using these criteria could mean that Indianapolis is the perfect retirement destination, while another may love their retirement in Fayetteville, Arkansas. And either of those cities could be a better fit than Florida, Arizona or any other more ‘typical’ retirement destination.”
You also might want to take a ‘try before you buy’ approach when selecting where to live out your final years.
“I recommend retirees rent before making a move,” said Tony Fiorillo, founder and CEO of Asset Management Strategies, Inc. “Short-term residential services like VRBO and Airbnb are great for lower-cost residential ‘exploration.’ This way, you aren’t just visiting. You are actually living there without making a huge financial commitment. Even when you are fairly certain where you might want to go, this still helps identify the best neighborhood or development for your tastes.”
Rose gave this bottom line: “If you get caught up in where everyone else wants to retire, you can miss what really matters in retirement: affordability, comfort and quality of life. If you choose a location that aligns with personal needs and budget, your retirement will be more fulfilling and financially secure.”
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