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The worst states to retire in have high taxes and living costs, lack access to affordable healthcare, and rank poorly for other quality-of-life factors, like weather and crime. If you're starting to think about where you might live in retirement, you're in the right place.
We'll cover the worst states to retire in and what makes them poor choices for many seniors. We'll also cover some tips on retirement planning and choosing a destination for your golden years.
New Mexico does not tax the majority of individuals receiving Social Security benefits unless they meet certain higher income thresholds. However, income from pensions and retirement accounts is taxable for state residents.
The state scored fairly well for housing and cost of living in The Motley Fool's study, with scores of 79 and 78, respectively.
However, it has the second-worst crime rate nationwide, with a crime score of 2. New Mexico also nabbed a low quality-of-life score. The state's healthcare score was 40, while New Mexico scored 50 out of 100 for taxes.
According to FBI data, New Mexico has one of the highest rates of violent crime against older adults in the nation. On average, violent crimes against seniors in the state occur at a rate of 212.2 per 100,000 individuals.
Retirees who spend their golden years in California could enjoy many benefits like stunning natural scenery, a mild climate year-round, diverse cultural experiences, ample outdoor activities, and participating in the world's fifth largest economy.
It's no shock to anyone that California is one of the most expensive places to retire. In The Motley Fool's study, California was ranked fifth-worst in cost of living. It has the second-highest cost of housing and fifth-highest tax burden of all 50 states.
California taxes pensions, although it does not tax Social Security benefits. The state is also known for having some of the highest personal income tax and sales tax rates in the country.
On the other hand, factors where California received the highest scores included quality of life (100 out of 100), healthcare (72 out of 100), and weather (85 out of 100).
If you're looking for major tax savings in retirement, you may want to cross New York off your list. New York doesn't tax Social Security benefits, but property taxes, income taxes, and sales taxes are among the steepest in the nation. However, people 65 and older may qualify for property tax exemptions, provided that they meet certain criteria.
In The Motley Fool's study, New York garnered the worst tax score in the country, scoring 0 out of 100. The exorbitant cost of housing in New York, even outside urban areas, could also deter retirees with a more modest sum for their older years.
However, it wasn't all bad news for New York. For example, The Empire State snagged the fifth-best quality-of-life score at 70 out of 100.
Arkansas has numerous green flags going for it, including beautiful natural attractions like rivers, mountains, forests, and hot springs. The state is also one of the most affordable places to reside in and be a homeowner, garnering a housing score of 93 out of 100 in The Motley Fool's study of the best and worst states to live in.
However, Arkansas received low scores for quality of life, public health, and crime, resulting in an overall score of 41 out of 100.
Broken down by the scoring factors, Arkansas received a 6 for quality of life, 19 for healthcare, and 37 for crime.
The state exempts Social Security benefits from taxation, but other forms of retirement income are taxable. Certain exemptions for pension or retirement account income can reduce that overall tax burden.
According to The Motley Fool's study, Nevada achieved moderate scores for cost of living (66 out of 100), cost of housing (58 out of 100), taxes (56 out of 100), and weather (72 out of 100).
However, it scored lowest in terms of public health and crime factors. These scores were 38 and 35, respectively. In the end, Nevada received an overall score of 45 out of 100.
Nevada is also one of the worst states for fraud and violent crime against older adults. The state has 240.8 victims of fraud per 100,000 older adults and 1,676.4 victims of property crime per 100,000 older adults.
Nevada doesn't have a state income tax. Neither retirement benefits nor Social Security benefits are taxable in Nevada.
There are plenty of factors to consider when you're planning for retirement and determining where you want to live once you're no longer working. Follow these tips for choosing the right place.
Of course, we're not saying that everyone should rule out living in the five states we chose as the worst states in which to retire. If you've built a large retirement nest egg, you might have the freedom to choose a retirement destination that would be unaffordable for most.
Other factors you'll need to consider are whether you prefer rural, urban, or suburban living, along with the amenities you're seeking and how close you want to be to family and friends. You may also want to consider looking beyond the U.S. and explore options for retiring abroad.
The best states to retire usually rank well for affordability, quality of life, low taxes, and good healthcare. But ultimately, you need to choose the factors that matter to you.
This data was then used to compile an index to rank the best states in which to retire. The index used the following factors and weights:
When choosing the worst states to retire, it's important to understand why some of these factors weighed so heavily in the final outcome.
Individual scores for various factors were then normalized on a 0 to 100 scale. Based on these criteria, here are the five worst states to retire to in 2026.
A recent Motley Fool study ranked the best and worst states to retire to in 2026. The Motley Fool surveyed 1,500 Americans 55 and older to find out the retirement factors that were most important to them.
In addition to primary data collected by The Motley Fool, the study used data and rankings from numerous reputable sources. These included The Council for Community and Economic Research's Cost of Living Index, Zillow Home Value Index, United Health Foundation's America's Health Rankings, the FBI Crime Data Explorer, and the National Incident-Based Reporting System.
