Here’s how much it costs to retire in 2021 in every state

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Many Americans work their entire lives with an eye on the retirement finish line, but what happens when it’s crossed? Deciding on a dream destination for the golden years should factor in that locale’s price tag, which can vary drastically.

MagnifyMoney researchers looked at the price to retire in every U.S. state, including costs for housing, food, transportation, Medicare Part B and Part C, entertainment and personal care. Researchers found Hawaii is the most expensive state to spend your retirement years, while Arkansas is the least expensive state.

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How older Americans spend their money

Here's how much it costs to retire in 2021 in every state

In general, people tend to spend less money as they get older. Peak spending years generally occur between ages 45 and 54 and decrease by 35% when people reach the 65-and-older range. Those 75 and older spend even less, with average spending that’s 44% lower than during those peak years.

As for what older Americans spend their money on, health care is a priority. In fact, those 65 and older spend 32% more annually, on average, on health care than all Americans.

Image Credit: monkeybusinessimages / iStock .

5 helpful retirement strategies

Here's how much it costs to retire in 2021 in every state

To help ensure your retirement dreams match up with your retirement reality, planning is vital. Whether you hire a financial advisor to help you map out a course or do the work on your own, it’s important to evaluate and use the tools that can help you plan for your best financial future.

1. Start saving early

One of the biggest mistakes people make is not starting saving and investing for retirement early enough. Ideally, people should start as soon as they enter the working world, even if the amount they start investing is small. That’s because they have the power of compound interest on their side and can take advantage of that.

“The best time to start saving for retirement is now,” says Ismat Mangla, senior director of content for MagnifyMoney. “If you haven’t started yet, don’t wait to start putting money away — even if it’s a small amount. It’s important to get into the habit, and you want time on your side. You’re not just saving for retirement, you are investing for retirement. Simply socking money away is not enough. You need to invest that money strategically for it to grow.”

2. Take advantage of employer-sponsored plans

Mangla urges people to take advantage of employer-sponsored plans, such as 401(k) accounts, which are tax-advantaged retirement accounts that allow employees to make contributions.

“Many 401(k) plans offer employer matching, which is a big part of your compensation,” she says. “Too many people don’t contribute enough money to their 401(k) accounts to at least earn the employer match, which means they are forfeiting a part of their income.”

3. Consider an individual retirement account (IRA)

If your employer doesn’t offer a retirement plan or you’ve maxed out your contributions to one, you may want to consider opening an IRA. While there are several types with various limits and rules, they offer a way to save for retirement with tax benefits.

“I especially like Roth IRAs because they offer a way to diversify your income in retirement,” Mangla says. “You’re putting after-tax money in a Roth IRA, but when you eventually withdraw the money in retirement, you won’t have to pay any taxes on it.”

4. Keep it simple

It may make sense to get help from a certified financial planner or financial advisor who can help you figure out the asset allocation you need to reach your goals. But there’s no need to over-complicate investing.

“I encourage investors to focus on low-fee index funds for their investments,” Mangla says. “There is a ton of research that shows these funds fare better in the long run than actively managed funds.

“I like a set-it-and-forget mentality. You don’t need to tinker too much with your retirement investments once you’ve allocated them properly. And don’t pay attention to the short-term ups and downs of the market. Keep your eye on the long game.”

5. Automate investments

Whether directly from your paycheck into an employer-sponsored plan or from your bank account into an online brokerage account, making automatic contributions to retirement savings can be a good way to ensure they get made. Instead of forgetting to make them or using those funds for something else (“Just this once!”), it’s a great way to keep you on track to meet your goals.

Image Credit: monkeybusinessimages // iStock.

Methodology

Here's how much it costs to retire in 2021 in every state

MagnifyMoney researchers used data from the U.S. Bureau of Labor Statistics (BLS), U.S. Bureau of Economic Analysis (BEA), U.S. Census Bureau and MedicareAdvantage.com to estimate various costs of retirement in every state.

We first used the 2019 Consumer Expenditure Survey from BLS to find out how much households aged 65 and older spend yearly, on average, on:

  • Food
  • Transportation (vehicle purchases, maintenance and repairs, vehicle insurance, etc.)
  • Entertainment
  • Personal care

We then multiplied those figures by BEA regional price parities from 2019, which calculate the difference in price levels for goods and services across each state. Next, we added each total to the 2019 U.S. Census Bureau one-year statewide estimates on housing costs for those with a mortgage, from mortgage payments to real estate taxes to utilities.

Finally, we added the average cost in 2021 of Medicare Part B and Part C (also known as a Medicare Advantage plan) across each state where available (Alaska doesn’t offer Medicare Part C). We used the standard Part B premium for 2021, while Part C data was compiled by MedicareAdvantage.com.

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Alabama

Here's how much it costs to retire in 2021 in every state

Housing: $1,172

Food: $472

Transportation: $536

Medicare Part B, Part C: $173

Entertainment: $170

Personal Care: $51

Image Credit: DepositPhotos.com.

Alaska

Here's how much it costs to retire in 2021 in every state

Housing: $1,882

Food: $578

Transportation: $656

Medicare Part B, Part C: $149*

Entertainment: $209

Personal Care: $63

*Medicare Part C isn’t available in Alaska.

Image Credit: Chilkoot.

Arizona

Here's how much it costs to retire in 2021 in every state

Housing: $1,457

Food: $530

Transportation: $601

Medicare Part B, Part C: $165

Entertainment: $191

Personal Care: $57

Image Credit: DepositPhotos.com.

Arkansas

Here's how much it costs to retire in 2021 in every state

Housing: $1,094

Food: $466

Transportation: $529

Medicare Part B, Part C: $171

Entertainment: $168

Personal Care: $50

Image Credit: wellesenterprises / iStock.

California

Here's how much it costs to retire in 2021 in every state

Housing: $2,421

Food: $640

Transportation: $727

Medicare Part B, Part C: $169

Entertainment: $231

Personal Care: $69

Image Credit: DepositPhotos.com.

Colorado

Here's how much it costs to retire in 2021 in every state

Housing: $1,845

Food: $560

Transportation: $636

Medicare Part B, Part C: $172

Entertainment: $202

Personal Care: $61

Image Credit: Lana2011 / iStock.

Connecticut

Here's how much it costs to retire in 2021 in every state

Housing: $2,087

Food: $577

Transportation: $656

Medicare Part B, Part C: $187

Entertainment: $208

Personal Care: $63

Image Credit: DenisTangneyJr.

Delaware

Here's how much it costs to retire in 2021 in every state

Housing: $1,557

Food: $547

Transportation: $621

Medicare Part B, Part C: $171

Entertainment: $197

Personal Care: $59

Image Credit: AndreyKrav / iStock.

Florida

Here's how much it costs to retire in 2021 in every state

Housing: $1,530

Food: $555

Transportation: $631

Medicare Part B, Part C: $162

Entertainment: $200

Personal Care: $60

Image Credit: DepositPhotos.com.

Georgia

Here's how much it costs to retire in 2021 in every state

Housing: $1,450

Food: $513

Transportation: $582

Medicare Part B, Part C: $166

Entertainment: $185

Personal Care: $56

Image Credit: suesmith2 / iStock.

Hawaii

Here's how much it costs to retire in 2021 in every state

Housing: $2,472

Food: $656

Transportation: $745

Medicare Part B, Part C: $195

Entertainment: $237

Personal Care: $71

Image Credit: DepositPhotos.com.

Idaho

Here's how much it costs to retire in 2021 in every state

Housing: $1,306

Food: $507

Transportation: $576

Medicare Part B, Part C: $185

Entertainment: $183

Personal Care: $55

Image Credit: knowlesgallery.

Illinois

Here's how much it costs to retire in 2021 in every state

Housing: $1,688

Food: $536

Transportation: $608

Medicare Part B, Part C: $179

Entertainment: $193

Personal Care: $58

Image Credit: venemama / iStock.

Indiana

Here's how much it costs to retire in 2021 in every state

Housing: $1,146

Food: $488

Transportation: $554

Medicare Part B, Part C: $169

Entertainment: $176

Personal Care: $53

Image Credit: DepositPhotos.com.

Iowa

Here's how much it costs to retire in 2021 in every state

Housing: $1,266

Food: $489

Transportation: $556

Medicare Part B, Part C: $179

Entertainment: $177

Personal Care: $53

Image Credit: DepositPhotos.com.

Kansas

Here's how much it costs to retire in 2021 in every state

Housing: $1,387

Food: $491

Transportation: $557

Medicare Part B, Part C: $167

Entertainment: $177

Personal Care: $53

Image Credit: Tiago_Fernandez / iStock.

Kentucky

Here's how much it costs to retire in 2021 in every state

Housing: $1,179

Food: $481

Transportation: $546

Medicare Part B, Part C: $168

Entertainment: $173

Personal Care: $52

Image Credit: DepositPhotos.com.

Louisiana

Here's how much it costs to retire in 2021 in every state

Housing: $1,279

Food: $483

Transportation: $549

Medicare Part B, Part C: $176

Entertainment: $174

Personal Care: $52

Image Credit: DepositPhotos.com.

Maine

Here's how much it costs to retire in 2021 in every state

Housing: $1,387

Food: $546

Transportation: $620

Medicare Part B, Part C: $174

Entertainment: $197

Personal Care: $59

Image Credit: DepositPhotos.com.

Maryland

Here's how much it costs to retire in 2021 in every state

Housing: $2,015

Food: $592

Transportation: $672

Medicare Part B, Part C: $213

Entertainment: $214

Personal Care: $64

Image Credit: Feverpitched / iStock.

Massachusetts

Here's how much it costs to retire in 2021 in every state

Housing: $2,276

Food: $607

Transportation: $689

Medicare Part B, Part C: $222

Entertainment: $219

Personal Care: $66

Image Credit: Rolf_52.

Michigan

Here's how much it costs to retire in 2021 in every state

Housing: $1,285

Food: $508

Transportation: $576

Medicare Part B, Part C: $206

Entertainment: $183

Personal Care: $55

Image Credit: haveseen.

Minnesota

Here's how much it costs to retire in 2021 in every state

Housing: $1,595

Food: $539

Transportation: $612

Medicare Part B, Part C: $213

Entertainment: $194

Personal Care: $58

Image Credit: DepositPhotos.com.

Mississippi

Here's how much it costs to retire in 2021 in every state

Housing: $1,149

Food: $464

Transportation: $527

Medicare Part B, Part C: $166

Entertainment: $167

Personal Care: $50

Image Credit: Feverpitched / iStock.

Missouri

Here's how much it costs to retire in 2021 in every state

Housing: $1,271

Food: $488

Transportation: $554

Medicare Part B, Part C: $167

Entertainment: $176

Personal Care: $53

Image Credit: StockPhotoAstur / iStock.

Montana

Here's how much it costs to retire in 2021 in every state

Housing: $1,466

Food: $514

Transportation: $584

Medicare Part B, Part C: $195

Entertainment: $186

Personal Care: $56

Image Credit: YinYang.

Nebraska

Here's how much it costs to retire in 2021 in every state

Housing: $1,427

Food: $492

Transportation: $559

Medicare Part B, Part C: $169

Entertainment: $178

Personal Care: $53

Image Credit: Pixabay.com.

Nevada

Here's how much it costs to retire in 2021 in every state

Housing: $1,589

Food: $536

Transportation: $608

Medicare Part B, Part C: $160

Entertainment: $193

Personal Care: $58

Image Credit: AlizadaStudios.

New Hampshire

Here's how much it costs to retire in 2021 in every state

Housing: $1,963

Food: $586

Transportation: $665

Medicare Part B, Part C: $179

Entertainment: $211

Personal Care: $63

Image Credit: DenisTangneyJr.

New Jersey

Here's how much it costs to retire in 2021 in every state

Housing: $2,413

Food: $638

Transportation: $724

Medicare Part B, Part C: $174

Entertainment: $230

Personal Care: $69

Image Credit: aimintang.

New Mexico

Here's how much it costs to retire in 2021 in every state

Housing: $1,269

Food: $501

Transportation: $569

Medicare Part B, Part C: $177

Entertainment: $181

Personal Care: $54

Image Credit: Davel5957.

New York

Here's how much it costs to retire in 2021 in every state

Housing: $2,156

Food: $640

Transportation: $726

Medicare Part B, Part C: $189

Entertainment: $231

Personal Care: $69

Image Credit: Frederic Prochasson.

North Carolina

Here's how much it costs to retire in 2021 in every state

Housing: $1,318

Food: $504

Transportation: $573

Medicare Part B, Part C: $168

Entertainment: $182

Personal Care: $55

Image Credit: DepositPhotos.com.

North Dakota

Here's how much it costs to retire in 2021 in every state

Housing: $1,430

Food: $491

Transportation: $558

Medicare Part B, Part C: $225

Entertainment: $177

Personal Care: $53

Image Credit: ChrisBoswell.

Ohio

Here's how much it costs to retire in 2021 in every state

Housing: $1,250

Food: $486

Transportation: $552

Medicare Part B, Part C: $194

Entertainment: $175

Personal Care: $53

Image Credit: Pixabay.com.

Oklahoma

Here's how much it costs to retire in 2021 in every state

Housing: $1,231

Food: $480

Transportation: $544

Medicare Part B, Part C: $170

Entertainment: $173

Personal Care: $52

Image Credit: Jamesbowyer.

Oregon

Here's how much it costs to retire in 2021 in every state

Housing: $1,750

Food: $562

Transportation: $638

Medicare Part B, Part C: $197

Entertainment: $203

Personal Care: $61

Image Credit: HaizhanZheng.

Pennsylvania

Here's how much it costs to retire in 2021 in every state

Housing: $1,477

Food: $533

Transportation: $606

Medicare Part B, Part C: $201

Entertainment: $192

Personal Care: $58

Image Credit: weaver1234.

Rhode Island

Here's how much it costs to retire in 2021 in every state

Housing: $1,837

Food: $557

Transportation: $632

Medicare Part B, Part C: $191

Entertainment: $201

Personal Care: $60

Image Credit: danlogan.

South Carolina

Here's how much it costs to retire in 2021 in every state

Housing: $1,250

Food: $503

Transportation: $571

Medicare Part B, Part C: $164

Entertainment: $182

Personal Care: $55

Image Credit: DepositPhotos.com.

South Dakota

Here's how much it costs to retire in 2021 in every state

Housing: $1,371

Food: $483

Transportation: $548

Medicare Part B, Part C: $219

Entertainment: $174

Personal Care: $52

Image Credit: DepositPhotos.com.

Tennessee

Here's how much it costs to retire in 2021 in every state

Housing: $1,264

Food: $493

Transportation: $560

Medicare Part B, Part C: $174

Entertainment: $178

Personal Care: $53

Image Credit: NathanMerrill.

Texas

Here's how much it costs to retire in 2021 in every state

Housing: $1,675

Food: $531

Transportation: $602

Medicare Part B, Part C: $170

Entertainment: $191

Personal Care: $57

Image Credit: RoschetzkyIstockPhoto / iStock.

Utah

Here's how much it costs to retire in 2021 in every state

Housing: $1,605

Food: $531

Transportation: $602

Medicare Part B, Part C: $168

Entertainment: $191

Personal Care: $57

Image Credit: johnnya123.

Vermont

Here's how much it costs to retire in 2021 in every state

Housing: $1,606

Food: $567

Transportation: $644

Medicare Part B, Part C: $190

Entertainment: $205

Personal Care: $61

Image Credit: DenisTangneyJr.

Virginia

Here's how much it costs to retire in 2021 in every state

Housing: $1,792

Food: $557

Transportation: $632

Medicare Part B, Part C: $172

Entertainment: $201

Personal Care: $60

Image Credit: WilliamSherman.

Washington

Here's how much it costs to retire in 2021 in every state

Housing: $1,951

Food: $596

Transportation: $677

Medicare Part B, Part C: $190

Entertainment: $215

Personal Care: $65

Image Credit: thyegn / iStock.

West Virginia

Here's how much it costs to retire in 2021 in every state

Housing: $1,052

Food: $479

Transportation: $544

Medicare Part B, Part C: $181

Entertainment: $173

Personal Care: $52

Image Credit: DepositPhotos.com.

Wisconsin

Here's how much it costs to retire in 2021 in every state

Housing: $1,412

Food: $505

Transportation: $574

Medicare Part B, Part C: $194

Entertainment: $182

Personal Care: $55

Image Credit: gguy44 / iStock.

Wyoming

Here's how much it costs to retire in 2021 in every state

Housing: $1,417

Food: $510

Transportation: $579

Medicare Part B, Part C: $201

Entertainment: $184

Personal Care: $55

This article originally appeared on MagnifyMoney.com and was syndicated by MediaFeed.org.

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