Jan 31, 2026
What’s at the top of your list when it comes to retirement locales? You might consider housing prices, access to a major airport for travel opportunities or a southern climate away from ice and snow.
However, a new ranking from CareScout (1) is focused on other factors: lower taxes, health care outcomes and cost of living. And because of this, one state tops their list of best places to retire in the U.S.
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Wyoming gets the gold star because the state does not have individual income tax, has a healthy older adult population and moderate cost of living. The state is home to Yellowstone and Grand Teton national parks, but as the experts at CareScout note, it’s also tops for older adults who need their retirement fund to stretch as far as possible.
"The affordability piece rockets Wyoming up to the top, along with tax friendliness," Marlena del Hierro, CareScout's director of operational growth, told Morningstar (2).
While CareScout notes the downsides of Wyoming include the weather and a shortage of doctors, the other benefits far outweigh these trade-offs. The ranking is heavily skewed towards cost of living concerns, as researchers note that the average 65-year-old is expected to live almost 20 more years, and financial concerns top the list of worries for many retirees.
With that in mind, here’s the rest of the rankings, and the places where you can expect your retirement fund to last the longest.
The best and worst places to retire in 2026
Rounding out CareScout’s list of the top 5 places to retire are New Hampshire, Vermont, Montana and South Dakota.
The report notes that New Hampshire ranks No. 2 because the state also has no individual income tax, and has the second-highest Social Security income in the U.S., at $29,422 on average.
Vermont has a robust community for older adults, with one of the country’s largest populations of seniors, and Montana stands out for its cultural and recreation venues.
Finally, South Dakota is a mix of all these factors: affordable, low tax and many recreational opportunities.
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On the flipslide, the worst state to live in as an older adult is New Jersey, according to the ranking.
The Garden State is not recommended by CareScout for its high personal income taxes, equally high cost of living and poor health outcomes for older adults, noting that 68% of Medicare beneficiaries in the state have three or more chronic conditions.
Massachusetts, New York, Alabama and Mississippi also rank poorly at the bottom of the list for high cost of living and high income tax.
However, CareScout notes that Massachusetts and New York both offer strong doctor availability and rank near the top in Medicaid spending in the country.
By contrast, Alabama and Mississippi have poor health outcomes and access to medical facilities, and also fewer recreational opportunities compared to the top states.
This ranking is a change from CareScout’s 2025 list, which saw the District of Columbia in the top spot (now the 6th best place to retire). New Hampshire jumped from No. 12 to No 2. Other big changes include Pennsylvania dropping from 5th to 27th on the list, and Utah and South Carolina improving significantly in their assessments.
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What to factor in before a move
It’s worth noting that while cost of living and taxes are the top concerns for CareScout, your personal reasons for selecting a place to retire are more important than what the experts say. If you have a comfortable retirement savings fund, you may choose to age in place in your own home, or stay close to your children and grandchildren, which may mean living in a higher-cost metro area.
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If you’re unsure where to retire, understanding how far your savings can go is a good first step, and this may mean working with a financial advisor.
Northwestern Mutual’s 2025 survey of U.S. adults shows that most people estimate they’ll need $1.26 million to retire comfortably. However, very few are prepared by their own standards, as Gen X respondents reported being unprepared for retirement, with only 52% having 3 times their current annual income saved (3).
For this reason, moving to a more affordable state may become common in later years.
As of 2024, only 260,000 Americans moved post-retirement, although this was a drop of 23.8% compared to 2023, according to an analysis from Hire A Helper. Surprisingly, the top destination was Massachusetts, one of the worst-ranked states for affordability (4).
While Sun Belt states remain popular for some retirees, the report suggests others may be avoiding this classic retirement spot due to rising incidences of extreme weather and their associated insurance costs, notes AARP (5).
How you can decide where to live in retirement
"This ranking can help people project and plan where they may want to be," del Hierro told Morningstar (2). "You have to think about: Where is your community? Does that push you to relocate? When you're retired, you have another chapter to live, so it helps to plan in advance."
As you’re planning your next chapter, rankings like these are information, not dictates. It helps to evaluate your current budget and spending, as this will give you an indication of how much you’ll be likely to need each year in retirement.
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If you find that your housing costs are too high, for example, it’s worth it to look at cheaper states, or even smaller cities or towns within your current state where you could shave down your living expenses while still having access to your community and a predictable cost of living.
Retirees should know that moving states can also come with major costs.
Along with the costs associated with selling your home, which may include staging, hiring a realtor and other expenses, moving out of state can cost between $1,400 and $8,000, according to This Old House (6). When you’re evaluating a move, take time to consider whether the upfront costs will balance out over time.
Even if you’re in an expensive state, the opportunities could outweigh the risks.
As CareScout notes, some of the most expensive states have the best access to health care, and seniors living in large metros also have better access to programs created for their benefit, as well as the many cultural centres that cities typically have.
If your idea of retirement includes getting involved in your community, you may find that you’re already in the right place to settle down.
Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
CareScout (1); Morningstar (2); Northwestern Mutual (3); Hire A Helper (4); AARP (5); This Old House (6)
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Rebecca Holland is dedicated to creating clear, accessible advice for readers navigating the complexities of money management, investing and financial planning. Her work has been featured in respected publications including the Financial Post, The Globe & Mail, and the Edmonton Journal.
