People planning for retirement have no shortage of rules of thumb to follow when they ask, "How much money do I need to retire?" Some experts suggest saving 1 percent of your salary by age 30, increasing every year until you have 10 times your salary saved at age 67. Others suggest $1 million as a solid goal. Still, others suggest accumulating enough to cover 80 percent of your current expenses each year.
The reality, however, is that what you need depends on where you live.
GOBankingRates calculated the average annual expenditures for a retired person in each state by examining each state's average cost of housing, groceries, transportation, healthcare and utilities. Next, we calculated how much money a retiree would need to start with to pay for these expenses, figuring a 4 percent withdrawal from savings each year. This assumes post-retirement investments will get an average return of 6 percent. That's a conservative estimate that leaves room for the effect of inflation.
Are you on track to save enough money for retirement? Click through to see which states require the most savings for a rich retirement.
How much you need to retire: $949,110
Wondering where your retirement savings will stretch the furthest? With annual living expenses of just $37,964, you can stretch your dollars further in Mississippi than anywhere else in the nation. The biggest benefit residents enjoy is an average $11,134 annual bill for housing, which is the cheapest in the country.
How much you need to retire: $981,491
Retirees in Arkansas need just $39,260 to get through a year, which is cheaper than the cost of living in all but one other state. At $5,997, it's the only state in the union with transportation costs lower than $6,000, and housing expenses average just $12,004 a year. The $3,100 grocery bill is also low, as is the $5,025 price tag for healthcare.
How much you need to retire: $994,891
Oklahoma is a member of a select group of just four states where residents can get by on less than $40,000 a year and retire with less than $1 million. The cheap $39,796 annual cost of living can be attributed largely to the state's $11,616 average housing costs, which is one of just six in the country under $12,000. The $3,201 grocery bill is also cheap, as is the state's $6,113 annual cost of transportation.
A separate GOBankingRates study found Oklahoma City, in particular, is one of the best places to retire where rent is under $1,000 a month.
How much you need to retire: $999,357
Annual healthcare costs tally just $5,416 in Michigan, which is the last state on this list that boasts a sub-$40,000 cost of living — $39,974, to be exact. Utilities are an affordable $3,323, but the real bargain is housing, which costs an average of only $12,330.
How much you need to retire: $1,001,590
Residents of the Volunteer State pay an average of just $12,221 per year for housing, which is largely responsible for the state's low $40,064 annual cost of living. Tennessee, however, is the first state to join the rest of the country in requiring more than $1 million for retirees to get by.
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How much you need to retire: $1,004,940
The cost of living in Georgia is a low $40,198. That can be credited to the state's status as a member of the six-state group with housing costs below $12,000 a year. Prospective retirees can expect to pay just $11,600 a year for shelter. All other categories fall below the national median as well, but far less than in the housing category.
How much you need to retire: $1,006,057
Utilities are a bit more expensive in Missouri than the national median, yet retirees there can stretch their dollars further than they could in all but six other states. The reason? Housing, which costs just $11,476, giving the state the title of fourth-cheapest in the country in terms of housing costs and one of just six to keep the average price under $12,000.
The total cost of living for retirees in Missouri is $40,242 a year. Springfield, Mo., in particular, is an affordable city to live in — it's one of the few places where you can live off less than $50,000 a year.
How much you need to retire: $1,009,406
At $3,035 and $12,889, the respective average grocery and housing bills paid by Texans are relatively inexpensive. Healthcare and utility costs are also cheaper compared to the national median, but not by much. All in all, the annual cost of living is $40,376 in the Lone Star state.
Thanks to lower living costs, Texas has numerous major cities where it doesn't cost much to live comfortably.
How much you need to retire: $1,011,640
The state of Alabama makes up for its relatively high $3,968 annual utilities bill with a comparatively cheap annual $5,019 healthcare cost — the lowest in the country. The real difference maker, however, is the state's $11,460 cost of housing, which is the third-cheapest in the United States. When all is said and done, retiree residents can expect to spend $40,466 a year.
Move to Birmingham: The Cheapest Place to Retire Is in Alabama
How much you need to retire: $1,011,640
Identical to their Southern counterparts in Alabama, residents of the Midwest state of Indiana also need $40,466 for total living expenses, which means they need a little more than $1.01 million to retire in the state. Also like Alabama, housing in Indiana — which costs just $12,082 per year — is largely responsible for the state's place among the 10 states where you need the least to retire.
Indiana might be an affordable state, but Indianapolis is one of the cities where the cost of living rose the most in the past year.
How much you need to retire: $1,013,873
Everything is cheaper than the national median across all categories in Idaho — except yearly transportation costs, which come out to $7,161. At $12,439 a year, the low price of housing is more than enough to make up for the slightly higher cost of getting around.
Costing just $2,913 a year, being the state with the cheapest grocery bill doesn't hurt either. In all, residents need just $40,555 to cover annual living costs.
How much you need to retire: $1,017,223
Retirees in Kansas can cover the total yearly cost of living with $40,689. Although everything is cheaper across all categories, the only thing that's significantly less expensive than the national median is housing, which costs just $12,191. That number gives Kansas the ninth-lowest housing costs in America.
How much you need to retire: $1,030,622
With an annual price of just $12,967, Iowa is one of only 15 states with housing costs lower than $13,000 a year. In fact, with housing costs so low, $300,000 buys you quite a lot of house in Iowa.
That's not the only reason, however, that retirees there pay a fairly low $41,225 to cover the annual cost of living. Groceries are affordable at just $3,191 a year. The cost of healthcare, however, is roughly the same as the national median. Transportation costs slightly more.
How much you need to retire: $1,035,088
Just one state in the entire country offers residents lower housing costs than the $11,429 annual average Ohio residents enjoy. The $6,880 annual bill for transportation is slightly higher than the national median, but everything else is less expensive than in the rest of the nation as a whole. All in all, total annual living expenses are $41,404.
How much you need to retire: $1,047,371
With an average cost of living of $41,895 a year, life costs a little less in Louisiana than in the nation as a whole — but not by much. All categories are just slightly cheaper in Louisiana, including groceries and transportation. The only dramatic savings come with housing, which costs just $13,666 per year on average — enough to keep the state among the 15 states where you need the least to retire.
How much you need to retire: $1,048,487
At $7,051, only transportation costs more in Nebraska than the national median. Both housing and utilities are pretty cheap, carrying average annual price tags of $13,743 and $3,204, respectively. If you want to retire in Nebraska, plan on spending about 41,939 to cover the cost of living.
How much you need to retire: $1,049,604
Utah residents enjoy a fairly low $14,240 annual housing bill as well as cheap utility bills that total just $2,946 per year — the third-cheapest in the country. In fact, everything is cheaper in Utah compared to the national median, except for groceries. But at $3,449 a year, supermarket bills aren't much higher than the median.
Looking to retire there? Plan to spend $41,984 per year on the overall cost of living. Utah is a great state to move to for other reasons, as well — like if you're unemployed and want a job.
33. North Carolina
How much you need to retire: $1,055,187
If you're planning on retiring in North Carolina, you can expect to spend $42,207 on the overall cost of living. At $6,147 a year, only healthcare costs more than the national median. The low cost of housing — $13,246 — is enough for the state to retain its place among the top 20 states where you need the least to retire.
How much you need to retire: $1,056,304
Kentucky residents enjoy cheap groceries and inexpensive housing, which come with price tags of $3,076 and $13,122 a year, respectively. Combine that with fairly low healthcare costs of $5,272, and residents of the state are able to get by on a total of $42,252 per year.
How much you need to retire: $1,057,420
Rounding out the 20 states where you need to save the least for retirement is Wyoming. In this Western state, retirees can cover cost-of-living expenses with $42,297 a year. Utilities are slightly pricier than the national median, but the splurging stops there. Costs are lower than the median in every other category, especially housing, which at $12,920 makes Wyoming one of just 15 states that caps housing costs under $13,000.
30. West Virginia
How much you need to retire: $1,064,120
The total cost of living in West Virginia is about $42,565 a year. The state's $5,296 average annual cost of healthcare is lower than what the rest of the nation pays, as is the $3,178 yearly utility bill. West Virginia's $3,602 average annual grocery bill, however, is a bit high.
29. New Mexico
How much you need to retire: $1,074,169
Housing, groceries and utilities are all cheaper in New Mexico than the national median, with the latter coming in at a cost of just $3,073 a year. The tradeoff is that residents of the state — and the retirees who plan to call it home — generally spend more on transportation than the average American. In total, the cost of living is about $42,967 a year.
How much you need to retire: $1,076,402
The good news for retirees with an eye on Wisconsin is that housing costs just $13,650 a year and the annual grocery bill is also lower than the national median. The $6,441 annual tab for healthcare, however, is a bit higher than the median. In all, the average cost of living is $43,056 a year.
How much you need to retire: $1,078,636
With the exception of groceries, for which Arizona residents fork over $3,439 every year, everything is cheaper in the state compared to the national median, including transportation, healthcare and utilities. The average annual cost of housing is $14,613, which isn't bad, either. The total cost of living in Arizona is $43,145 per year.
If you're behind on preparing for your future, take these immediate steps to get ready for retirement.
How much you need to retire: $1,084,219
Rounding out the cheaper half of the list is Illinois, where residents can expect to pay about $43,369 annually to get by in the state. The annual $7,270 transportation bill is hefty compared to the national median, but all the other categories are slightly cheaper, including groceries, utilities, healthcare and housing.
How much you need to retire: $1,094,268
Retiree residents of the massive northern state of Montana encounter annual living costs of about $43,771. The only standout category is utilities, which comes in at $2,877, the lowest in the country. Everything else, including healthcare and the annual grocery bill, is about on par with the national median, putting Montana squarely in the middle of the list.
24. North Dakota
How much you need to retire: $1,108,784
Montana's neighbor to the east, North Dakota, offers its residents inexpensive housing and utilities, which cost an average of $14,628 and $3,196 a year, respectively. Although transportation and the cost of groceries are a little pricier than the national median, the state's average $6,452 annual healthcare bill is ranked higher than any other category, at seventh-highest in the country.
Don't worry, even if you have a lower salary, you can still save $1 million (or more) for retirement in a state like North Dakota.
How much you need to retire: $1,113,250
Drive east across North Dakota and you'll eventually hit Minnesota, where retirees can expect to pay a hefty $6,447 a year for healthcare. Transportation and grocery costs are also higher than the national median. Residents get a break, however, on housing and utilities, which are lower than the median. That helps cap the annual cost of living at $44,530 a year.
22. South Dakota
How much you need to retire: $1,118,833
Joining the cluster of central northern states is South Dakota, where residents need to spend $44,753 a year to get by. Residents get a break on transportation costs, which come in at a relatively low $6,257 per year. That, however, is not enough to compensate for the state's high housing costs, which bleed retirees of $17,563 a year.
How much you need to retire: $1,121,066
Florida, where the annual cost of living is $44,843, is probably more closely associated with retirement than any other state. In fact, a few of the cheapest places to retire are in Florida.
At $3,602 a year, grocery bills are high, as is the cost of transportation and utilities. Residents get a break, however, on housing, which costs an average of $15,172 a year, which is slightly below the national median. Healthcare costs are also comparatively cheap.
20. South Carolina
How much you need to retire: $1,122,183
The cheapest of the 20 states where you need the most to survive retirement is South Carolina, where retirees will need to spend $44,887 a year in living expenses to get by. Utility costs are comparatively high, coming in at $4,095 a year, and the cost of healthcare and groceries are also higher than the national median — but not significantly. The good news for retirees interested in South Carolina is that both housing and transportation costs are comparatively cheap.
How much you need to retire: $1,134,466
Retired residents of Colorado can get by on $45,379 per year. Both healthcare and housing costs in the state — $6,107 and $17,517, respectively — are more expensive than the national median. Utilities, however, cost just $3,059 a year — the fourth-cheapest state in the country.
How much you need to retire: $1,134,466
Since the cost of living in Nevada is identical to the $45,379 Coloradans spend every year, retirees there will need the same amount to live in retirement. Also like Colorado, Nevada offers residents cheap utility bills — $3,109, to be exact. At $17,517, however, the cost of housing is high, as are costs associated with both transportation and healthcare.
How much you need to retire: $1,135,582
Virginia residents enjoy expenses that are cheaper than the national median across every category — except one, that is. Housing costs a hefty $17,191 a year. The biggest savings come from the state's cheap $3,591 average annual bill for utilities. When the tally is complete, annual expenses average $45,423.
How much you need to retire: $1,140,049
Utility bills are high in Pennsylvania, with an average annual cost of $4,019. But with yearly costs of $5,152 and $15,187, respectively, the price of healthcare and housing are both comparatively cheap. In total, the cost of living in Pennsylvania is $45,602 a year.
If you're approaching retirement age, there are still simple ways to catch up on retirement savings.
How much you need to retire: $1,144,515
The First State has a place among the 15 states that require the most money to retire despite its relatively low $15,281 average annual cost of housing. Transportation and healthcare costs are also lower than the national median in Delaware. Residents and retirees pay more, however, for their utilities and groceries. All expenses combine for a grand total of $45,781 a year.
How much you need to retire: $1,184,713
In the state of Washington, the average retired resident is required to spend about $47,389 per year to cover living costs. Although the average annual cost for utilities is a fairly low $3,334, the price of every other category is above the national median.
How much you need to retire: $1,284,090
Maine holds the title of two firsts on this list. It's the first state with annual living costs for retirees over $50,000 — $51,364, to be exact — and it's the first to require retirees to save more than $1.2 million if they want to be comfortable. That's because costs are higher than the national median across all categories — all but groceries, that is. Residents spend a low $3,347 a year at the supermarket.
12. New Hampshire
How much you need to retire: $1,317,588
In New Hampshire, residents spend $4,128 a year on groceries — more than all but two states. In the Granite State, utilities cost an average of $4,824 a year — also the third-most-expensive of all states. Residents of the state can expect to spend more than the national median across all categories, for a grand total of $52,704 in average annual cost-of-living expenses.
How much you need to retire: $1,347,736
In Vermont, New Hampshire's New England neighbor, retirees can expect to pay much more across all categories except for healthcare, which is still higher than the national median, but not by nearly as much as the rest. Housing alone costs a steep $22,377 a year. When you add everything up, cost-of-living expenses for retirees average $53,909 per year.
10. New Jersey
How much you need to retire: $1,353,319
Garden State residents will retire in one of the most expensive states in the country, but at least New Jersey is the cheapest among the top 10. Although residents of the state pay more across all categories, including a hefty $4,207 utility bill, housing stands out as especially costly. The average annual price of shelter for retirees in New Jersey is $23,573.
9. Rhode Island
How much you need to retire: $1,375,651
The $21,942 average annual housing bill and the high $4,621 cost of utilities make tiny Rhode Island one of the most expensive states for retirees looking to stretch a dollar. In all, residents will need $55,026 to cover the cost of living.
How much you need to retire: $1,421,432
Although Oregon ranks No. 8 overall on the list, only four states have a higher annual housing bill than the $27,316 needed in Oregon. The good news is the $2,903 average annual utility bill is the second-lowest in the country, although groceries are fourth-highest at an average of $3,938 a year. The overall cost to live in Oregon for a year is $56,857, but at least it's one of five states with no sales tax.
How much you need to retire: $1,441,531
The New England state of Connecticut requires retirees to spend $57,661 to cover annual living costs. A large part of the reason for the stiff yearly price tag is Connecticut's high $6,619 average annual healthcare costs. Just four states cost more.
How much you need to retire: $1,441,531
The wealthy Mid-Atlantic state of Maryland is home to sky-high annual housing costs averaging $28,899 — just three states require residents to pay more for shelter. That, along with expensive $7,394 yearly transportation fees, contribute to overall cost-of-living expenses of $57,661 per year. In the end, Maryland residents need just as much to retire as those living in Connecticut.
How much you need to retire: $1,444,880
Rounding out the top five states that require the most to retire is Massachusetts. A $6,844 yearly average healthcare bill is the third-highest in America, but there are still strategies to follow to keep medical bills low.
At $4,628 a year, utilities are costlier there than in all but three other states. If retirees want to live their golden years in Massachusetts, they can expect to pay $57,795 a year for the privilege.
4. New York
How much you need to retire: $1,463,863
With average annual living costs of $58,555, retired residents of the Empire State spend more each year to get by than those in all but three other states. New York holds the title of ninth most expensive in the country in the categories of both transportation and groceries. That, however, is not nearly as imposing as the $29,055 average annual cost of housing, which is the third-highest in the country.
How much you need to retire: $1,468,329
The average annual cost of living in the northern outpost of Alaska is a high $58,733. With an average annual cost of $4,651, only Hawaiians pay more for groceries. At $21,585 a year, housing is high, but not extremely so.
How much you need to retire: $1,521,926
Sunny California is one of just two states that require residents to cough up more than $60,000 a year to cover their expenses — $60,877, to be exact. A large reason for that is the extreme cost of housing, which comes with an average annual tab of $30,514. As burdensome as that might seem, the most expensive state in the union charges its residents $16,000 more for shelter.
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How much you need to retire: $2,095,858
Hawaii is a paradise — if you can afford it. The $5,626 annual grocery bill is the most expensive of any state by far. The $46,478 yearly cost of housing makes even California look tame. in total, retirees in Hawaii can expend to spend almost $23,000 more per year in annual living expenses than the second-most expensive state, for a grand total of $83,834. It's the only state in the country that requires residents to enter retirement with more than $2 million.
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Methodology: GOBankingRates found the annual cost of expenditures for a retired person in each state by multiplying the retiree expenditures from the Bureau of Labor Statistics by the Cost of Living for each state from the Missouri Economic Research and Information Center. To find how much money a retired person would need to save, we divided each state's annual expenditures by .04, assuming drawing down savings by 4 percent each year to pay for living expenses.