In 15 U.S. states, you need to be a millionaire to afford basic retirement expenses, according to a new analysis from GOBankingRates.
The states with the highest retirement costs also tend to have the highest housing costs, whether it's large urban centers like New York and California or Hawaii, where the natural beauty and mild climate attract many retirees.
In fact, Hawaii is the most expensive state to retire in. The cost of necessities (housing, groceries, transportation, utilities and health care) totals approximately $2.21 million over 25 years. That's significantly higher than in Massachusetts and California, where retirees need about $1.6 million each to get by.
This estimate comes from the latest average cost of living data from the U.S. Bureau of Labor Statistics. After subtracting average Social Security income from annual expenses, GOBankingRates divides the remaining amount by 4%, following a common rule of thumb for safely withdrawing your retirement savings.
These totals represent the bare minimum needed for retirement without taking into account other factors such as rising inflation, discretionary spending or unexpected expenses.
Here are the 15 most expensive states to retire, ranked by total savings required:
1.Hawaii
- Annual living expenses: $110,921
- Savings you need for retirement: $2,212,084 USD
2.Massachusetts
- Annual living expenses: $88,268
- Savings you need for retirement: $1,645,764
3. California
- Annual living expenses: $86,946
- Savings you need for retirement: $1,612,716
4.Alaska
- Annual living expenses: $74,147
- Savings you need for retirement: $1,292,753 USD
5. New York
- Annual living expenses: $74,147
- Savings you need for retirement: $1,292,753 USD
6. New Jersey
- Annual living expenses: $68,980
- Savings you need for retirement: $1,163,566
7. Vermont
- Annual living expenses: $68,559
- Savings you need for retirement: $1,153,051 USD
8. Washington
- Annual living expenses: $68,259
- Savings you need for retirement: $1,145,540 USD
9. Maine
- Annual living expenses: $68,199
- Savings you need for retirement: $1,144,038
10. Arizona
- Annual living expenses: $67,778
- Savings you need for retirement: $1,133,522 USD
11. Rhode Island
- Annual living expenses: $67,538
- Savings you need for retirement: $1,127,514 USD
12. Connecticut
- Annual living expenses: $67,117
- Savings you need for retirement: $1,116,998 USD
13. New Hampshire
- Annual living expenses: $66,997
- Savings you need for retirement: $1,113,994 USD
14. Oregon
- Annual living expenses: $66,096
- Savings you need for retirement: $1,091,462 USD
15. Utah
- Annual living expenses: $65,795
- Savings you need for retirement: $1,083,951 USD
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