Where You Retire Could Change Your Savings Needs by As Much as $1.49 Million
A new analysis by GoBankingRates suggests that the state where you retire could significantly impact your savings needs. In Hawaii, for example, you would need around $2.21 million to retire at 65 and cover essential living expenses, including housing, groceries, transportation, utilities, and healthcare, for 25 years. This is the highest minimum required in any U.S. state. On the other hand, West Virginia requires just $712,913, the lowest amount needed to cover these same basic costs.
The estimates are based on average annual living expenses for each state, using the most recent data available from the U.S. Bureau of Labor Statistics. After subtracting average Social Security income from the annual expenditures, GoBankingRates divided the remaining amount by 4%, following a common rule of thumb for safely drawing down retirement savings.
It’s important to note that these figures reflect the bare minimum needed to retire and do not account for discretionary spending, such as travel or entertainment. While housing is the biggest factor driving cost differences between states, significant variations in healthcare, utilities, and transportation also play a role.
Here is a look at the expected total needed for retirement at age 65 in each state:
* Alabama: $53,357, savings needed: $773,000
* Alaska: $74,147, savings needed: $1,292,753
* Arizona: $67,778, savings needed: $1,133,522
* Arkansas: $53,477, savings needed: $776,005
* California: $86,946, savings needed: $1,612,716
* Colorado: $61,709, savings needed: $981,803
* Connecticut: $67,117, savings needed: $1,116,998
* Delaware: $60,207, savings needed: $944,248
* Florida: $61,529, savings needed: $977,296
* Georgia: $54,980, savings needed: $813,559
* Hawaii: $110,921, savings needed: $2,212,084
* Idaho: $61,289, savings needed: $971,288
* Illinois: $57,383, savings needed: $873,646
* Indiana: $54,859, savings needed: $810,555
* Iowa: $54,319, savings needed: $797,035
* Kansas: $52,095, savings needed: $741,455
* Kentucky: $55,821, savings needed: $834,590
* Louisiana: $56,181, savings needed: $843,603
* Maine: $68,199, savings needed: $1,144,038
* Maryland: $59,426, savings needed: $924,720
* Massachusetts: $88,268, savings needed: $1,645,764
* Michigan: $55,460, savings needed: $825,577
* Minnesota: $57,263, savings needed: $870,642
* Mississippi: $52,576, savings needed: $753,472
* Missouri: $53,477, savings needed: $776,005
* Montana: $56,482, savings needed: $851,114
* Nebraska: $55,761, savings needed: $833,087
* Nevada: $60,147, savings needed: $942,746
* New Hampshire: $66,997, savings needed: $1,113,994
* New Jersey: $68,980, savings needed: $1,163,566
* New Mexico: $55,821, savings needed: $834,590
* New York: $74,147, savings needed: $1,292,753
* North Carolina: $58,645, savings needed: $905,192
* North Dakota: $55,340, savings needed: $822,572
* Ohio: $57,023, savings needed: $864,633
* Oklahoma: $52,816, savings needed: $759,481
* Oregon: $66,096, savings needed: $1,091,462
* Pennsylvania: $57,023, savings needed: $864,633
* Rhode Island: $67,538, savings needed: $1,127,514
* South Carolina: $57,203, savings needed: $869,140
* South Dakota: $55,460, savings needed: $825,577
* Tennessee: $54,078, savings needed: $791,027
* Texas: $55,641, savings needed: $830,083
* Utah: $65,795, savings needed: $1,083,951
* Vermont: $68,559, savings needed: $1,153,051
* Virginia: $60,387, savings needed: $948,755
* Washington: $68,259, savings needed: $1,145,540
* West Virginia: $50,954, savings needed: $712,913
* Wisconsin: $59,666, savings needed: $930,729
* Wyoming: $57,323, savings needed: $872,144
