How to decide where to retire

Whether you’re starting to prepare for retirement or already enjoying it, deciding where to retire is a key part of planning your future. Do you envision moving to a new location, or would you rather stay where you are? Before making a choice, it’s helpful to consider how a new area might impact your day-to-day life. Here are several factors to consider when deciding where to live after retirement.

Why your retirement location matters for life after retirement

Choosing where to spend your retirement can have a significant impact on your lifestyle, financial security, and overall well-being. This decision influences the opportunities and activities available to you, as well as how comfortably you can live on your retirement savings. Thinking carefully about these factors can help ensure that your chosen location supports the kind of life you hope to enjoy once retirement arrives. As you prepare for retirement, location planning can be just as important as income planning because where you live may influence your budget, access to care, and everyday quality of life.

Cost of living in retirement

When looking at where to retire, a big consideration should be affordability. The cost of living is how much money is needed to cover all your expenses, including housing, groceries, healthcare, transportation, and entertainment. A common rule of thumb states you’ll need to replace 70% to 90% of your working income to maintain your standard of living in retirement. That percentage may vary depending on when you retire, your retirement location, when you start taking Social Security, and what your personal goals are for the future.

If you have your eye on a popular destination, remember that vacation spots and tourist towns are often more expensive. A cost-of-living calculator can help you compare how much goods and services are in your current area compared with the city you have in mind.

Access to healthcare

Access to healthcare is an important factor to explore when deciding where to live in retirement, as it can play a key role in both day-to-day well-being and long-term planning. Living in an area with dependable medical services and providers who accept Medicare can make it easier to manage routine care and unexpected health needs. It’s also worth considering how a location can support changing needs over time, including access to specialists, rehabilitation services, and long-term care options like assisted living or skilled nursing care. Choosing a location with strong healthcare access can help provide greater confidence and stability during retirement.

Climate conditions

Everyone has different tastes when it comes to climate. If you’re looking for a warm area with beaches, you may consider moving to the coast of California or a southern state like Florida. If you like mountains, a place in the southwest like Colorado or New Mexico might be a good fit for you. By choosing a retirement location that has a climate and seasons that you prefer, you’ll likely stay more active and spend more time doing the activities you enjoy. If you’ve only visited a place during the summer, take time to research the average temperatures and weather during the rest of the year. As you age, you may wish to avoid high snowfall areas or want a place that offers more months of outdoor leisure and events.

State and local taxes

When deciding on your retirement destination, state and local taxes can be important factors. Each state has different rules on how a retiree’s income and Social Security are taxed, where many offer tax breaks for residents over a certain age. For example, there may be deductions or credits for taxpayers over age 65; exclusions of Social Security income from taxable income; no personal income tax; or exclusion of withdrawals from retirement plans or pensions.

Sales and property taxes

Property taxes and sales taxes can also cut into retirement income, so research this information for the city and state you’re considering. Certain states, like Oregon, Montana, Delaware, and New Hampshire, do not have statewide sales tax. When it comes to property taxes, they can vary greatly from place to place, but many offer exemptions that allow seniors to protect part of their home’s value from property taxes. It can be helpful to contact a tax professional in the state you’re considering to ensure you understand your potential tax bill, as well as possible inheritance and estate taxes and how you could maximize your tax savings.

How to prepare for retirement relocation

Preparing to move in retirement starts with taking a thoughtful, step-by-step approach to narrowing down potential destinations. Rather than making a quick decision, it can be helpful to explore different options, spend time evaluating how each location may fit long-term needs, and consider how a move could reshape daily life after retirement. Approaching the process with flexibility and a willingness to learn more about each option can help make the transition feel more manageable. If moving in retirement is part of your plan, reviewing your finances, healthcare needs, and lifestyle priorities ahead of time can help you feel more confident before making a final decision.

Research retirement locations

When contemplating a potential move, you’ll want to get up to speed on the retirement areas you’re considering. Most towns have a visitors’ bureau available online that will give you information about the town's history, safety, transportation, quality of life, and local activities. Find out if the area has a busy tourist season and if the population and traffic change throughout the year. Many times, retirees have already visited a place beforehand or know people who live in the area who can provide valuable insight. By doing your research, it can help you make an educated decision on whether relocation is right for you.

Do a trial run

Before committing to a new city or town, a trial run can help you get a better idea of how your daily life would be. If possible, rent a place for several months or even a year to gain a better understanding of the traffic, the convenience of stores and restaurants, the weather, and if you feel at home in this new location. Visit neighborhoods in each area, talk to locals, and participate in community events to help form your opinion.

Ask yourself if you would prefer to live in a location that is tailored to retirees, or if you enjoy a family-oriented town. Living in an area for an extended period can help you determine if it’s suitable to meet all your needs. If you feel it could be a good match, meet with realtors to explore housing costs and resale values, ask questions, and determine if this might be a good place to relocate for retirement.

Consider downsizing in retirement

Downsizing is a common consideration in retirement, whether it involves relocating to a new area or moving to a smaller home within the same community. Moving to a more manageable space can help reduce housing costs, lower maintenance responsibilities, allow more time for travel, and free up resources for other priorities. It may also create an opportunity to simplify day-to-day living and focus more on your lifestyle goals.

For many retirees, downsizing may also coincide with other life transitions, such as becoming empty nesters, reassessing household expenses, or thinking differently about long-term financial priorities. As you evaluate whether a move makes sense, it can be helpful to consider how your housing choices fit into your broader financial picture.

Making a move in retirement? See how Midland National can help prepare for your future

As you evaluate where to retire, it’s equally important to consider how your broader financial strategy supports that decision. Midland National offers a range of annuity and life insurance solutions designed to support long-term savings goals, provide retirement income strategies, and protect what matters most. To learn more, contact Midland National to discuss which options can meet your needs as you plan for what’s next.