10 Cheapest and 10 Most Expensive States to Retire Early
GOBankingRates determines how much would be needed by state to retire at 50
Dreaming of retiring at 50? Not many can—or should, but for those that really want to have a go at it, the folks over at GOBankingRates have ranked all 50 states in terms of how much you would need in savings to attempt such a thing.
Whether a FIRE devotee (Financial Independence, Retire Early) focused on extreme saving and investment techniques to allow them to retire far earlier than traditional budgets and retirement plans would permit, or someone in a situation where an early retirement seems likely for any variety of reasons, retiring early successfully requires plenty of preparation.
“If you are looking to retire early, the first step is to calculate how much savings you’ll need to afford your annual expenses,” Andrew Murray, Lead Data Content Researcher at GOBankingRates, told 401(k) Specialist. “Our research shows that in every single U.S. state, the average person will need at least $1 million to retire by 50—but that figure may need to be significantly larger if you live an above-average lifestyle or if you live in a more expensive part of the country.”
For example, while the savings needed to retire at 50 is roughly $1.1 million in states like Mississippi and West Virginia, it is more than double that amount in states like California, Massachusetts and Washington.
“And those are just the figures to be retired for 30 years. If you want to plan on being retired until 90, you’ll need as much as $3 million in America’s most expensive states,” Murray added.
In order to make these calculations, GOBankingRates analyzed the latest cost of living data for all 50 states from two different sources: the Bureau of Labor Statistics and the Missouri Economic and Research Information Center. “Using this data, we calculated both the savings needed to retire at 50 and live for 30 years, and separately, the savings needed to live for 40 years,” Murray said. “We considered the savings you’d need both with Social Security benefits and without them.”
Click below to see the 10 cheapest states for retiring early, while the following page features the 10 most expensive states. You can find the complete report, which includes an interactive U.S. map and table with data for every state, here.