In this article, we will discuss the 25 cities where Social Security goes the farthest for retirees. You may skip our detailed discussion on Longevity Risks in Retirement and see the 5 Cities Where Social Security Goes the Farthest for Retirees.
Longevity Risks in Retirement
While there is no single golden number for a retirement nest egg, The Charles Schwab Corporation (NYSE: SCHW) recommends that the generic rule be to retire with 25x your annual withdrawal for the first year. Unfortunately, even such a vast nest egg might prove to be insufficient for those set to retire. In such a scenario, retirees would be at risk of running out of funds during the latter years of retirement, which can be detrimental to their health and quality of life.
According to a poll by Jackson Financial Inc. (NYSE: JXN), 32% of retirement investors might be underpredicting the duration of their retirement. Such a huge proportion of individuals are susceptible to this error because most people either do not consider the length of their retirement when planning for it or do not entertain the possibility of living beyond a certain age. Jackson Financial Inc. (NYSE: JXN) reports that over 40% of retirement investors project their life expectancy based on the age of a parent.
Unfortunately, increasing life expectancy means that many retirees could witness over 30 years of retirement, despite having planned for a significantly lower duration. According to Morgan Stanley (NYSE: MS), the average retirement in 1970 lasted between 12 and 16 years. Now it’s common for retirements to span 20 years or more and that number may continue to increase.
READ ALSO: 15 Best Places in South Carolina For A Couple To Live On Only Social Security and 15 Best Places in Texas for a Couple to Live on Only Social Security.
Solutions to Cope with Longevity Risks
To cope with longevity risks, many Americans are now delaying their retirement. By pushing their retirement by just a few years, individuals have a chance to swell up their nest egg whilst also reducing the number of years they live off savings. For those relying on Social Security, delaying the age at which they claim Social Security allows them to increase their yearly income. In other cases, individuals are giving up on retiring conventionally by choosing to retire gradually. According to Willis Towers Watson Public Limited Company (NASDAQ: WTW), 34% of U.S. employees age 50+ want to phase into retirement.
“Phased retirement can be a win-win for both employees and employers. Working fewer hours even with reduced pay can help employees transition into retirement, both financially and emotionally.”
-Jonathan Sterbanz, Senior Director, Retirement, Willis Towers Watson Public Limited Company (NASDAQ: WTW)
Willis Towers Watson Public Limited Company (NASDAQ: WTW) is a global advisory, broking, and solutions company headquartered in London. As of September 3rd, the company’s market cap has increased to $29.68 billion. In late July, the company released its Q2 2024 quarterly results. After a strong first half of the year, the company was able to surpass analyst expectations of EPS by 9%. Reported EPS for the quarter was $2.55 against expected EPS of $2.34.
The company attributed its impressive performance to the success of its Transformation Program, under which it has been able to improve its productivity and identify areas to boost savings. Consequently, the company achieved $24 million in incremental annualized savings this quarter, bringing the total to $394 million in cumulative annualized savings since the program’s inception nearly three years ago. Since the release of its financials, the company has announced a quarterly cash dividend of $0.88 per common share, in line with the dividend paid following Q1 2024.
While we acknowledge the potential of WTW as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than WTW but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
Living on Social Security
Another common way of achieving financial security in retirement is relocation. Retirement expenses can be trimmed down considerably based on the location of your retirement. For example, in July 2024, the average benefit paid out to retired workers by the Social Security Administration was $1,919.40. In comparison, data from Forbes shows that the average monthly cost of living in the US can range anywhere from $1,347 in Mississippi to $2,312 in Hawaii. Thus, by picking an appropriate destination for retirement, retirees can live comfortably on Social Security alone whilst also maintaining a reasonable quality of life.
Thus, if you’re wondering about the best state to retire on Social Security only or which place has the highest Social Security benefit, join us as we look at cities where Social Security goes the farthest for retirees.
25 Cities Where Social Security Goes the Farthest for Retirees
Methodology
To develop our list of cities where Social Security goes the farthest for retirees, we initially picked out the most recommended cities where Social Security goes the farthest for retirees on the internet. We used 10+ sources including our list of the Best Places to Live on Only a Social Security Check and Most Affordable Places to Retire in the U.S. in 2024 to develop a shortlist. Further research was narrowed down to these places only.
Among these best places, we developed a scorecard using metrics such as livability scores, cost of living, and average rent. Livability scores were sourced from Area Vibes while average rent was obtained from Zillow Group, Inc. (NASDAQ: Z). By standardizing these metrics on a linear scale, each place was scored, based on which we sorted our list in descending order. The top 15 places were chosen for our list.
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Here are 25 Cities Where Social Security Goes the Farthest for Retirees.
25. Wichita, Kansas
Insider Monkey Score: 16.82
Livability Score: 68
Median Rent: $1,195
IM Cost of Living: 83.9
Wichita is known as the “Air Capital of the World”. There is a wide tapestry of excursions to experience in Wichita, including games at the Riverfront Stadium, the flora and fauna of The Wichita Gardens, and literal treasures at the Museum of World Treasures.
24. Conway, Arkansas
Insider Monkey Score: 17.24
Livability Score: 69
Median Rent: $1,350
IM Cost of Living: 80.5
Conway is surrounded by several natural landmarks such as the Arkansas River, Conway Lake, and several state parks. Retirees interested in adventure and excitement would be thrilled to know that there are opportunities for kayaking, hunting, and fishing in the surrounding area.
23. Shreveport, Louisiana
Insider Monkey Score: 17.46
Livability Score: 60
Median Rent: $975
IM Cost of Living: 80.9
The cost of living and rent in Shreveport are quite affordable. It is one of the cities where Social Security goes the farthest for retirees and also boasts several riverboat casinos.
22. Little Rock, Arkansas
Insider Monkey Score: 17.57
Livability Score: 72
Median Rent: $1,262
IM Cost of Living: 82.9
Little Rock is the capital of Arkansas. Apart from its significance in the civil rights history, it offers access to incredible outdoor locations. It is located a short drive from Pinnacle Mountain State Park, Ouachita National Forest, and the Ozark Mountains.
21. Lake Charles, Louisiana
Insider Monkey Score: 17.88
Livability Score: 68
Median Rent: $1,000
IM Cost of Living: 84.1
Although Lake Charles is more expensive than cities such as Shreveport, it is one of the most fun places to retire in. It is home to casinos, golf courses, and parks, and hosts more than 75 festivals each year.
20. Abilene, Texas
Insider Monkey Score: 18.07
Livability Score: 75
Median Rent: $1,350
IM Cost of Living: 81.6
Abilene is home to several museums, as well as the Abilene State Park. The cost of living in the city is 18.4% below the national average, meaning it is quite affordable as well.
19. Oklahoma City, Oklahoma
Insider Monkey Score: 18.09
Livability Score: 81
Median Rent: $1,350
IM Cost of Living: 85.3
Oklahoma City is one of the most affordable metropolitans in the US and one of the cities where Social Security goes the farthest for retirees. Moreover, it is a cultural melting pot with influences of the area’s historical cowboy culture still lingering to this day.
18. Evansville, Indiana
Insider Monkey Score: 18.13
Livability Score: 66
Median Rent: $1,059
IM Cost of Living: 81.0
In terms of recreation, Evansville offers access to museums, zoos, and minor-league baseball & hockey games. In addition, it is quite affordable in terms of both housing and living expenses.
17. Kalamazoo, Michigan
Insider Monkey Score: 18.14
Livability Score: 76
Median Rent: $1,161
IM Cost of Living: 85.4
Kalamazoo is home to 6 colleges, meaning that the streets are bustling with a lively atmosphere. Its youthful charm and affordability make it one of the best places to retire in the U.S.
16. Joplin, Missouri
Insider Monkey Score: 18.41
Livability Score: 64
Median Rent: $1,100
IM Cost of Living: 78.2
As of tax year 2024, Missouri will exempt Social Security and public pension payments from state income taxes. Joplin is one of the most affordable cities on our list in terms of cost of living, which is 21.8% lower than the national average.
15. Lubbock, Texas
Insider Monkey Score: 18.56
Livability Score: 78
Median Rent: $1,400
IM Cost of Living: 81.1
Lubbock is located about 90 miles from the New Mexico – Texas border in Northwest Texas. One major advantage of retiring in Texas is that retirees get to enjoy their retirement income tax-free. In case they wish to work post-retirement, they don’t need to pay any taxes on that either.
14. Brownsville, Texas
Insider Monkey Score: 18.91
Livability Score: 79
Median Rent: $1,550
IM Cost of Living: 78.0
In terms of rent, Brownsville is the most expensive destination on our list. However, the cost of living in the area is quite affordable, making it one of the best places to retire on a fixed income.
13. Tupelo, Mississippi
Insider Monkey Score: 18.99
Livability Score: 72
Median Rent: $1,200
IM Cost of Living: 79.6
All forms of retirement income in Mississippi are exempt from state income taxes. Although it is most famous for being the birthplace of Elvis Presley, Tupelo has also gained significant interest from retirees due to its pleasant weather, tax friendliness, and overall affordability.
12. McAllen, Texas
Insider Monkey Score: 19.1
Livability Score: 75
Median Rent: $1,275
IM Cost of Living: 79.8
McAllen lies just 70 miles from the Gulf of Mexico, allowing retirees to enjoy plenty of sunshine and round-the-year beach trips.
11. Midland, Michigan
Insider Monkey Score: 19.41
Livability Score: 84
Median Rent: $1,275
IM Cost of Living: 84.4
Midland is home to a wide range of parks, allowing residents to have access to incredible forestry and riverscapes. In addition to a high quality of life, Midland is quite affordable. Its cost of living is over 15% lower than the national average, making it one of the cities where Social Security goes the farthest for retirees.
10. Gaffney, South Carolina
Insider Monkey Score: 19.48
Livability Score: 66
Median Rent: $950
IM Cost of Living: 78.8
Gaffney is one of the best places to retire financially. It is perfect for retirees looking to escape the bustle of a big city and settle into a smaller, closely-knit community.
9. Akron, Ohio
Insider Monkey Score: 19.79
Livability Score: 81
Median Rent: $1045
IM Cost of Living: 85.4
Akron was once known as the rubber capital of the world. Today, apart from its economic significance, it features a rich heritage and a vibrant arts scene, along with breathtaking natural beauty in the nearby area.
8. Davenport, Iowa
Insider Monkey Score: 19.86
Livability Score: 77
Median Rent: $975
IM Cost of Living: 84.0
Davenport is situated along the banks of the Mississippi River. Due to its affordable housing costs, it is one of the cities where Social Security goes the farthest for retirees. Apart from affordability, it features a vibrant downtown that boasts restaurants, breweries, live concerts, baseball games, galleries, and more.
7. Sheboygan, Wisconsin
Insider Monkey Score: 20.00
Livability Score: 77
Median Rent: $1,049
IM Cost of Living: 82.2
Sheboygan lies in eastern Wisconsin, on the shores of Lake Michigan. It is home to some of the best beaches and surfing spots in the region, earning it the nickname “Malibu of the Midwest”.
6. Harlingen, Texas
Insider Monkey Score: 20.03
Livability Score: 73
Median Rent: $1,200
IM Cost of Living: 77.0
Harlingen sits at the southernmost tip of Texas. The cost of living in Harlingen is 23% below the national average, which is the most affordable out of all the destinations on our list.
5. Springfield, Illinois
Insider Monkey Score: 20.22
Livability Score: 81
Median Rent: $1,150
IM Cost of Living: 82.2
Illinois is a decent option for retirees looking for a tax-friendly environment. The state has a flat income tax rate of 4.95% exempted on retirement income, including social security, pensions, and distributions.
4. Fort Wayne, Indiana
Insider Monkey Score: 20.36
Livability Score: 84
Median Rent: $1,100
IM Cost of Living: 84.5
Fort Wayne is the second largest city in Indiana. Despite its large population, it is significantly more affordable than other major cities in Indiana such as Carmel, Bloomington, and Indianapolis.
3. Grand Forks, North Dakota
Insider Monkey Score: 21.50
Livability Score: 79
Median Rent: $895
IM Cost of Living: 81.5
Grand Forks is located on the eastern border of North Dakota to Minnesota. Grand Forks features miles of incredibly beautiful riverfront real estate, courtesy of the Red River. It is also home to the University of North Dakota and the Grand Forks Air Force Base.
2. Hattiesburg, Mississippi
Insider Monkey Score: 21.80
Livability Score: 78
Median Rent: $910
IM Cost of Living: 79.7
Hattiesburg is a bustling city in southeastern Mississippi. In terms of rent, Hattiesburg is the most affordable destination on our list. In addition, the cost of living in the city is 20% lower than the national average. From a vibrant culinary scene to public art and an impactful civil rights history, Hattiesburg offers well-rounded entertainment, making it one of the cities where Social Security goes the farthest for retirees.
1. Hays, Kansas
Insider Monkey Score: 22.75
Livability Score: 78
Median Rent: $750
IM Cost of Living: 79.6
Although Kansas is one of the states that continues to tax social security, seniors with an adjusted gross income of $75,000 or less are exempted from these taxes. Hays is the largest city in northwestern Kansas. In terms of rent, it is the most affordable city on our list. The city is home to the historic Fort Hays, a landmark that attracts tourists from across the country. Well-maintained, friendly, and affordable, Hays is one of the top cities where Social Security goes the farthest for retirees.
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Disclosure: None. 25 Cities Where Social Security Goes the Farthest for Retirees is originally published on Insider Monkey.