The choice of where to live in retirement can have a huge effect on your quality of life. That's not just because some places have far more activities for seniors or make life easier in your later years thanks to easy access to healthcare services. Where you live can affect your retirement in a profound way because some places are a lot more expensive for seniors than others.

If you live in a high cost-of-living area or a place where you'll face substantial taxes on your retirement income, you'll likely need to withdraw more from your savings accounts to have the same standard of living as someone who lives in a cheaper area. This can put you at risk of running out of cash unless your account balance is particularly hefty. 

To make sure you preserve your nest egg, you may want to think about relocation if you live in an expensive place -- unless you're sure you can afford to sustain yourself there throughout the entirety of your retirement. But, which places are the most costly for seniors to live in? This list will help you figure that out. 

Older working woman wearing apron and stocking shelves.

Image source: Getty Images.

These 10 states are the most expensive for seniors

According to recent research from the University of Massachusetts, Boston, these states are the 10 most expensive for seniors:

  • District of Columbia: Single renters in D.C. will need $33,060 to cover basic necessities while couples will need $44,868
  • Massachusetts: Single renters here will need $33,048 while couples require $45,252
  • Hawaii: Single renters require $32,688 and couples need $44,700
  • Maryland: Single renters need $30,480 and couples need $42,984
  • New York: Here, single renters require $30,480 and couples need $41,640
  • California: Single renters require $30,276 and couples need $40,380
  • New Jersey: Single renters need $29,616 and couples will require $40,128
  • Vermont: Single renters need $29,340 and couples will need $43,392
  • Connecticut: Here, the minimum for single renters to cover necessities is $28,536 and couples need  $39,660
  • New Hampshire: Single renters living here will need $28,308 and couples require $40,884

With an average Social Security benefit of $1,503 per month in 2020, seniors who live in these high-cost-of-living areas will likely need significant savings to provide supplementary income. These figures are based on what it costs to cover just the basics with no money for gifts, large purchases, dining out, savings, or entertainment. So it's likely most people will end up spending far more.

Single seniors who receive the average Social Security benefit would need just over $15,000 in additional income if they lived on this bare-bones budget in D.C.. Assuming that senior followed the 4% rule and withdrew 4% of a retirement account balance, they'd need a nest egg of $375,000 just to survive. Meanwhile, a single senior renter in Alabama would need just $21,504 in total income per year to cover the necessities, so could survive with just $86,700 saved. 

Of course, this would be for a lifestyle that offered no money for fun and no room for error, which isn't how most retirees want to live. But it shows just how much of an effect as to where you live can have on how much money your savings must produce for you. 

Do you live in a high cost-of-living area?

If you live in a place that made the list of the most expensive places for seniors, you need to make sure you can really afford to stay put when you retire. If you can't, trying to hold on to your expensive home could end up jeopardizing retirement security if you spend your nest egg too quickly.

It can be far better to relocate to a cheaper place while you can do so voluntarily with a large retirement account balance, rather than spending down your cash and being forced to move later in life because you've run out of funds. You'll want to make sure that doesn't happen to you, so assess your financial situation ASAP and consider where you should live as a retiree.