Here's What a 'Comfortable' Retirement Actually Costs in Every Region of the U.S.

When people plan for their retirement years, most employees focus on the amount they need in their 401(k) retirement plans. While this is extremely important and necessary, there is one big lever they can pull to make a retirement more affordable: their location.

In fact, the gap between the cheapest and most expensive retirement states is enormous. Being open to moving and changing locations as a retiree could make the difference between retiring on time and working a few more years. Here is more information about what a comfortable retirement looks like in every region of the United States.

What a comfortable retirement means to most people

According to a survey from Northwestern Mutual, Americans believe they'll need $1.26 million to retire comfortably. Being financially comfortable means different things to different people, but The Pew Charitable Trusts defines financial stability as having good cash flow, emergency savings, and a limited amount of high-interest debt.

To achieve that in retirement, people need enough money to support themselves, cover their essential bills, and afford some extras. According to 2024 Bureau of Labor Statistics data, the average consumer unit (which could be a single person or a group of people who financially depend on each other) spends $78,535 per year. This amount includes spending on all categories, including housing, food, health care, entertainment, and more.

South

The southern part of the United States is one of the most affordable parts of the country to retire. Data reported by Kiplinger found that Oklahoma is the most affordable state to retire in, as you only need $735,284 saved to retire there. Mississippi is next with $752,178 needed to retire. Then, it's Alabama with $789,037 needed to retire.

These states are known for having affordable real estate, which contributes to the low cost of living. Not all Southern states are considered extremely affordable for retirement. For example, you'd need $967,190 to retire in Florida.

Midwest

The Midwest is also known for having more affordable housing and an overall lower cost of living than other parts of the United States. For example, you'd need $805,931 to retire in Missouri and $804,395 to retire in Kansas. It's slightly more expensive to retire in Illinois, with $911,901 needed, and in Wisconsin, with $939,564 needed.

West Coast

The West Coast is a desirable place to live because of the beautiful weather and mountains in many states. The most affordable place to live on the West Coast is New Mexico, with $859,684 needed to retire there. However, other states, like California, are among the most expensive places to retire in the country, with $1,538,508 needed to retire there.

Northeast

Finally, the Northeast has many beautiful states, but it is by far one of the most expensive areas of the country. For example, you would need to save over $1 million to retire in Massachusetts, New York, New Jersey, Maine, Connecticut, Vermont, Rhode Island, and New Hampshire. Still, many retirees may choose to live in these states to be close to family members, friends, or specific community resources, like health care centers.

Where you retire can extend your nest egg

As evidenced, where you retire can make a big difference in how long your savings last. For example, you'd need over $2 million saved to retire in Hawaii, but only $810,358 to retire in Arkansas. Over a 20-year retirement, that difference amounts to several hundred thousand dollars saved by choosing a different location to live out your golden years. If you don't have a large nest egg, it may be worth considering a move.

How to get help with your retirement plan

Planning for retirement is a multifaceted process. Most people focus only on the number they need to retire. However, making a withdrawal strategy, optimizing your taxes, and choosing where to live can all impact how long your nest egg lasts.

If you need help creating a retirement plan and figuring out whether you're on track to retire on time, consider working with a professional, such as a financial advisor. A financial planner can take the time to learn about your goals, interests, and lifestyle needs in retirement and use that information to help you accomplish your personal finance goals.

Bottom line

Everyone deserves a comfortable, stress-free retirement. However, achieving that depends not only on how much you have saved for retirement, but also on your lifestyle choices and where you live. In fact, you may be able to have a more comfortable retirement by moving to a more affordable state, as the cost of living varies dramatically from state to state. Ultimately, when planning your retirement years, be open-minded about your location, as moving to the wrong region could be a surprising financial mistake.