Retiring to Arizona? Here Are 10 Critical Things You Need To Know

Delve into the lesser-known side of retiring in Arizona, beyond the desert beauty.

A man looking over the Grand Canyon
Updated July 11, 2024
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Arizona ranks among the top 10 states with a growing population, and many of its new residents are retirees. The climate is warm and dry, and the lifestyle is easy.

But before you pack up the moving van, here are some things — good and bad — that you might want to consider before moving to the state. Being well-informed now may help you avoid wasting money later.

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There are plenty of retirees in Arizona

Sabrina/Adobe multi ethnic senior woman talking and laughing together in park

One of the biggest reasons people are moving to Arizona is because they're retiring. So you won’t be alone when you move to the state to start your post-work life.

In fact, 34.5% of people surveyed by moving company United Van Lines said retirement was the main reason for their move to Arizona, beating out family needs or job changes.

It doesn’t tax Social Security

Deen Jacobs/peopleimages.com/Adobe senior couple on sofa with bills paperwork

You may want to consider Arizona for retirement because the state doesn’t tax Social Security income.

However, you will want to factor in other taxes when considering whether to move to Arizona. You might have to pay state income taxes, which could include income from your 401(k) retirement account and property taxes.

Arizona also has a 5.6% state sales tax and an average local sales tax of 2.77%, bumping total sales tax to around 8.37%. That sales tax puts it at the higher end of sales tax rates in the U.S.

Housing prices are coming down

jdross75/Adobe arizona resort under orange sky with cute cactus plant at sunset

Housing prices are lowering over time, with a median sale price of $451,100 for the state in May. That’s still at the higher end of costs, but it’s lower than two years ago, according to the real estate website Redfin.

And cities are relatively in line with the state average if you’re concerned about higher living costs in more populated areas. 

For example, in May, Phoenix's median sale price was $463,000, while Tempe's was $497,500.

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It’s hot, but it’s a dry heat

Jenifoto/Adobe phoenix desert with mountains and cactus plants at sunset

Arizona can get hot, particularly in the summer, with temperatures above 100 degrees many days. But those temperatures can vary depending on where you live. 

For example, Phoenix's average high temperature in July is 106 degrees, while Flagstaff, at an elevation of 6,909 feet, has an average high of 80 degrees that month.

But Arizona doesn’t have much humidity, which can make those hotter days a little more pleasant and less muggy. Florida, on the other hand, can have high humidity every day from June to August.

Retirees can find plenty of activities

Azee J/peopleimages.com/Adobe senior multi ethnic men hiking on mountain while talking to each other

Arizona can be a great state if you want to be active in retirement.

The state is well known for Grand Canyon National Park, which is good for a short trip to see this natural wonder. You can also spend several days hiking, camping, or participating in other outdoor activities.

And there are plenty of golf courses to check out if you prefer to play golf. Arizona is home to more than 300 courses for you to choose from.

You’ll need a car

Animesh/Adobe empty forrest gump road under cloudy sky

Arizona is not like living in Chicago or New York when it comes to public transportation. There is some public transportation, but not enough to rely on it to get you from place to place. 

Instead, you’ll have to rely on your car to get to most places, mainly because of the sprawl of some of the bigger cities. So factor in the costs of owning and maintaining a car when you put together your estimated retirement budget if you decide to move to Arizona.

Arizona has a thriving art scene

JackF/Adobe senior woman showing around things to young girl in museum

Arizona may be the place for you if you plan to pursue art as a hobby or side hustle when you retire. The state has plenty of options to display your wares depending on where you settle down.

In fact, with so many retirees, you may want to consider finding a 55+ community in Arizona with space dedicated to your arts and crafts plans.

There’s a water shortage

Aaron/Adobe beautiful one story adobe style houses in arizona during day time

One of the most significant issues facing Arizona right now is a drought, which is affecting the state's water supply.

Because you live in the desert, you have to drink more water. However, the water shortage can also affect issues such as owning a pool or the kind of landscaping you choose. 

Many communities require plants that require little to no water or have restricted hours when you can water your landscape.

Arizona has a diverse population

Lumeez Ismail/peopleimages.com/Adobe senior couple sitting on couch enjoying free time by hugging each other

Consider moving to Arizona if you like the idea of living among a diverse group of people. The state has a large Spanish-speaking population, with almost 20% of residents speaking Spanish. 

It also has a rich Native American heritage with a large population of Native American tribes, including the Navajo Nation and Hopi Tribe.

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You have to deal with dust

JSirlin/Adobe haboob sandstorm blowing towards desert in arizona

Arizona is a wonderful option if you have seasonal allergies in a state with seasons. But Arizona has its own weather problems: haboobs.

A haboob is a dust storm that sweeps across the desert and occurs frequently in Arizona. While you may not be sneezing and coughing in the spring due to pollen, you may have to learn to live with dust and sand suddenly enveloping your neighborhood.

Bottom line

Alexey Stiop/Adobe senior couple enjoying vacation while sitting on bench in arizona during day time

Before you start thinking about where you want to live when you retire, you should figure out how much you’ll need to retire. Then, it would be best to compare the cost of living where you currently live with that of your desired location in Arizona. 

If you move to a different location, you may be surprised by the change in the cost of living.

And if you find you can retire early, be sure your savings will cover a longer retirement.

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Jenny Cohen

Jenny Cohen is a freelance writer who has covered a bit of everything, from finance to sports to her favorite TV shows. Her work has been featured in The Wall Street Journal, USA Today, and FoxSports.com.