Frugal Retirees: Steer Clear of These 13 Ultra-Expensive California Cities
Written by
Nicole Spector
Edited by
Molly Sullivan
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It’s no surprise that California is among the states people most desire to live in, with big, exciting metros like Los Angeles being particularly appealing. The Golden State boasts an abundance of charms; it’s got great weather, gorgeous natural scenery and a booming economy. For some, moving to California makes good sense, even financially. But for retirees? That’s a tricky issue.
The vast majority of retirees live on a fixed income that hinges at least partly (sometimes solely) on Social Security benefits. That means frugality is a must. And, with the sheer costs of housing alone, practicing frugality in California can be very difficult. Of course, some areas are pricier than others. In a new study, GOBankingRates found the top 13 cities in California that frugal retirees should steer clear of due to astronomically high prices. These metros are ranked to show the highest total cost of living along with the highest expenditure costs.
13. Palos Verdes Estates
- Average single-family home value: $2,796,503
- Average monthly mortgage cost: $16,157
- Average monthly expenditures cost: $1,935
- Total cost of living monthly: $18,093
- Total cost of living annually: $217,113
12. Menlo Park
- Average single-family home value: $2,923,777
- Average monthly mortgage cost: $16,893
- Average monthly expenditures cost: $1,801
- Total cost of living monthly: $18,694
- Total cost of living annually: $224,328
11. Laguna Beach
- Average single-family home value: $3,062,672
- Average monthly mortgage cost: $17,695
- Average monthly expenditures cost: $1,787
- Total cost of living monthly: $19,482
- Total cost of living annually: $233,783
10. Manhattan Beach
- Average single-family home value: $3,061,965
- Average monthly mortgage cost: $17,691
- Average monthly expenditures cost: $2,046
- Total cost of living monthly: $19,737
- Total cost of living annually: $236,843
9. Cupertino
- Average single-family home value: $3,300,318
- Average monthly mortgage cost: $19,068
- Average monthly expenditures cost: $1,789
- Total cost of living monthly: $20,857
- Total cost of living annually: $250,282
8. Stanford
- Average single-family home value: $3,626,578
- Average monthly mortgage cost: $20,953
- Average monthly expenditures cost: $1,862
- Total cost of living monthly: $22,815
- Total cost of living annually: $273,784
7. Malibu
- Average single-family home value: $3,741,445
- Average monthly mortgage cost: $21,617
- Average monthly expenditures cost: $1,963
- Total cost of living monthly: $23,580
- Total cost of living annually: $282,964
6. Palo Alto
- Average single-family home value: $3,848,165
- Average monthly mortgage cost: $22,233
- Average monthly expenditures cost: $1,745
- Total cost of living monthly: $23,978
- Total cost of living annually: $287,741
5. Newport Beach
- Average single-family home value: $3,871,655
- Average monthly mortgage cost: $22,369
- Average monthly expenditures cost: $1,741
- Total cost of living monthly: $24,110
- Total cost of living annually: $289,319
4. Saratoga
- Average single-family home value: $4,183,370
- Average monthly mortgage cost: $24,170
- Average monthly expenditures cost: $1,960
- Total cost of living monthly: $26,130
- Total cost of living annually: $313,559
3. Los Altos
- Average single-family home value: $4,577,456
- Average monthly mortgage cost: $26,447
- Average monthly expenditures cost: $1,870
- Total cost of living monthly: $28,317
- Total cost of living annually: $339,802
2. Hillsborough
- Average single-family home value: $5,022,237
- Average monthly mortgage cost: $29,017
- Average monthly expenditures cost: $1,802
- Total cost of living monthly: $30,819
- Total cost of living annually: $369,830
1. Beverly Hills
- Average single-family home value: $5,413,243
- Average monthly mortgage cost: $31,276
- Average monthly expenditures cost: $1,878
- Total cost of living monthly: $33,154
- Total cost of living annually: $397,851
Methodology: For this study, GOBankingRates analyzed U.S. cities in California to find the places that frugal retirees should avoid. Using the U.S. Census’ American Community Survey cities in California were identified along with the total population, population ages 65 and over, total households, and household median income. With the cities identified the cost of living indexes were sourced from Sperling’s BestPlaces and include the grocery, healthcare, housing, utilities, transportation, and miscellaneous cost of living indexes. Using the cost of living indexes and the national average expenditure costs for retired households, as sourced from the Bureau of Labor Statistics Consumer Expenditure Survey, the average expenditure cost for each location can be calculated. The livability index was sourced from AreaVibes for each location as supplemental information. The average single-family home value was sourced from Zillow Home Value Index for February 2025. Using the average single-family home value, assuming a 10% down payment, and using the most recent (March 13, 2025) national average 30-year fixed mortgage rate, as sourced from the Federal Reserve Economic Data, the average mortgage can be calculated. Using the average mortgage and average expenditure costs, the average total monthly and annual cost of living can be calculated. The cities were sorted to show the highest total cost of living as well as the highest expenditure costs, showcasing the places frugal retirees should avoid. All data was collected on and is up to date as of March 19, 2025.
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