Unveiling the True Cost of Living in Top Cities

Thinking of heading down South for your retirement? You’re not alone. Many retirees choose a Southern state due to the warm climate, lower cost of living, and tax-friendly treatment of retirement funds.

However, not everyone who moves south is retired. A U.S. migration report released in January 2024 by PODS shows that more Americans are migrating to the Southern Appalachian region, which includes states like North Carolina, South Carolina, Tennessee, Georgia, and Alabama, than to any other region in the U.S.

If you haven’t settled on a place, a key consideration will be the cost of retirement living. In partnership with Southern Living, Investopedia examined data from the Census Bureau and others (see our Methodology section below) to shed light on the cost of retirement in over 600 locations. 

Based on our analysis of the 47 cities, Hot Springs City, Arkansas, Englewood, Florida, and Charleston City, West Virginia, were three excellent picks for cost and affordability. Take a closer look at why they topped our list.

1. Hot Springs, Ark.: Spa City for Seniors 

Hot Springs, Arkansas, affectionately known as “Spa City,” is among the top spots for retirement in 2024 thanks to its low cost of living, no state property taxes, and access to nature for retirees with active lifestyles. Around 22.7% of the city’s population is 65 years or older, and the median age is 44.7.

The main attractions are Hot Springs National Park and Diamond Lakes, which offer beautiful biking, hiking, fishing, and water sports spots. The Hot Springs area is also home to several annual music and film festivals.

Housing Costs 

The median housing costs in Hot Springs are 30% less than the average in the South ($810 per month versus $1,163). As for housing costs, Hot Spring City’s apartment rentals can be as low as $500, while its median home sale price is $350,000 as of August 2024, making it affordable for both renters and buyers—especially those relocating from higher-cost areas.

Hot Spring City residents earned a median household income of $46,537 between 2018 and 2022. The national median for that period was $74,580.

2. Englewood, Fla.: An Older Folks’ Paradise 

Florida has long been a retirement hotspot, but one under-the-radar area in particular is becoming super popular with the 65+ crowd—Englewood CDP. In fact, the area’s median age is 67.8.

The Gulf Coast town’s local governance is split between Charlotte and Sarasota counties, and its median monthly housing cost is $779, 33% lower than the South’s overall average.

Besides being right on the beach, residents enjoy the area’s golf courses, local parks, preserves, and its below-average crime rate. The Olde Englewood shopping district offers a selection of restaurants and a farmers’ market.

Cost of Living

In Englewood, the median income is $61,734. Though it’s below the national median of $74,580, it stretches farther given relatively lower median home values.

The median home sale price in Englewood is $364,833 which puts its income-to-home value at about 16.92%. That compares favorably to the 18.1% income-to-home value nationally, based upon a median home price of $412,300 as of the second quarter of 2024.

3. Charleston, W.Va.: Big City Mountain Living  

The capital city of West Virginia, Charleston, offers big city perks and mountain living for retirees. As the song says, for many, West Virginia offers an “almost heaven” experience—but that’s as long as you don’t mind changing seasons and cold winters. 

Although the population is 48,864 and has a younger median age of 42.2, there is an appeal for older people, with the state even listing it as a “Designated Retirement Community.” The perks include having access to the best healthcare and hospitals in the state, a vibrant downtown, an arts and culture scene, and lots of activities for outdoor enthusiasts.

Affordable Homes

Perhaps the biggest draw to Charleston is that its homes are very affordable, with a median home sale price of $196,633 compared to $412,300 nationally. The median annual income of $58,902 in Charleston makes up about 29.96% of the area’s median home sale price—compared to the national figure of 18.1%, based on a median income of $74,580.

Renters can also find affordable housing, as the median rent is $870 per month. With a median monthly income of $4,909, it takes around 17.72% of income to cover rent. This is below the national figure of 22.6% of income that is needed to pay rent (based on the national median rent of $1,405 as of October 2024, and $6,215 national median monthly household income).

West Virginia also ranks 31st in the nation for its average combined state and local sales tax rate of 6.567%. 

4. Valdosta, Ga.: For the Young at Heart

With an estimated population of more than 55,000 and a young population (mostly thanks to Valdosta State University, which has 10,000 students), Valdosta offers active lifestyle retirees an affordable place to live their golden years. It boasts a downtown arts scene, world-class golf courses, and hiking trails.

More important for seniors on a fixed income, it has affordable housing costs—a median monthly cost of $893, which is 23% less than the South overall. If you’re buying a home, the median home sales price of $239,900 (as of August 2024) is also attractive compared to the national average.

Flat Tax 

Tax-wise, Georgia is one of 13 states that has a flat income tax; meaning everyone pays the same regardless of income (which can be beneficial if you have a higher level of income in retirement). Georgia’s individual income tax rate is 5.49%.

Property taxes are relatively low, with an average effective rate of 0.940% for Lowndes County (though there are other areas on our list with more favorable rates).

5. North Myrtle Beach, S.C.: Beach Life

If beachfront living in a less crowded area is your ideal retirement spot, then give North Myrtle Beach, SC a look. This nine-mile family-friendly area encompasses four communities (Cherry Grove, Windy Hill, Ocean Drive, and Crescent Beach), and is less crowded than the touristy Myrtle Beach. The population is over 18,000.

Retirees with a lower income could benefit from the state’s graduated individual income tax, with rates ranging from 0 to 6.40%. As for state and local tax, South Carolina is ranked 11th in the nation with its 8.9% rate.

Reasonable Property Taxes

While the median home sold in North Myrtle Beach is on the high side at $422,500, property taxes are manageable at an average county tax rate of 0.36% (for Horry County). On a $400,000 home, that would be $1,440 per year.

6. Hickory, N.C.: Small City in the South

For a more small-city experience, retirees might find their next home in Hickory, North Carolina. The area features a balance of nature and downtown living thanks to Lake Hickory, numerous parks and trails, restaurants, and shopping.

Though the median age is a young 37.9, older residents are drawn by the median monthly housing costs of $960, which are 17% lower than the South overall. As for home prices, the median sales price of $305,000 is also lower than other metro areas.

Affordability All-Around

For those who plan to rent, with a median monthly income of $4,854, it would require around 18.9% of income to cover the median rent of $917 per month. North Carolina’s flat 4.5% individual income tax rate is also an attractive feature.

7. Maryville, Tenn.: Walkable Small Town

While Nashville has gotten a lot of hype over the last few years, another Tennessee city is standing out for its friendly, small-town vibe. Maryville, just south of Knoxville, has a population of just under 32,000 and a median age of 41.2.

Active retirees will enjoy its walkability, historic buildings, and downtown shopping and restaurants. Plus, plenty of nature can be found in its parks and close proximity to the Smoky Mountains.

Tax-Friendly

Tennessee does not have an individual income tax, making it a pension-friendly state. It also has the third lowest average combined state and local sales tax rate in the nation at 7.6%.

Home prices are slightly higher than in some other Southern cities at $394,400, but the median household income of $74,610 is on par with the national average of $74,580.

8. Vero Beach, Fla.: Affordable Life of Leisure

Living along the beachfront coast just minutes away from an arts and culture scene is a retiree’s paradise, which is why many are flocking to Vero Beach, Florida. There’s no shortage of water sports, golf, and fishing, plus beautiful botanical gardens to enjoy.

It’s become a desirable location since it’s not as hot—or as expensive—as some other South Florida areas like West Palm Beach.

Save on Housing and Taxes

Homes are in the affordable range with a median sales price of $375,000, while median rent is a bit higher than other areas (though still lower than the national average) at $1,139. Property taxes are also reasonable, with Indian River County paying 0.78%.

But with Florida, affordability comes back to taxes. There are no individual income taxes. And Florida’s average combined state and local sales tax rate of 9.1% ranks 8th best in the nation.

9. Fredericksburg, Texas: Wine Country Living

Fredericksburg is a small town with a population of around 10,875, but it’s the epicenter of Texas wine country with more than 60 wineries, vineyards, and wine-tasting rooms. Besides food and wine, the area is also a haven for history buffs and German culture as the town was founded by German settlers back in 1846.

Favorable Tax Treatment

Though Fredericksburg, Texas has higher median housing costs than some of the other places featured in our report (8% higher than the South overall), retired residents can save in other ways. Joining Florida and Tennessee, Texas also has no individual income tax. State and local sales tax is also lower than most at 8.60%, which ranks 4th in the nation.

10. Orange Beach, Ala.: A Golfer’s Paradise

Though a small population of just 8,095, Orange Beach, Alabama, is often found on various lists of “best places to retire.” The area has a median age of 51.6, with 28.5% ages 65 and older.

Its most stunning feature is its miles of white sand beaches, but active retirees also come for the championship golf courses. Alabama is home to the Robert Trent Jones Golf Trail, which includes 11 championship-caliber golf courses. 

Home prices are high, with the median sales price being $690,000. However, it may be skewed by the multimillion-dollar homes on the beach.

Tax Savings 

One huge benefit of living in Alabama as a retiree is that there is no tax on Social Security. In addition, the state has a graduated individual income tax ranging from 2% to 5%. The average combined state and local sales tax rate is also lower than most at 9.29%, ranking Alabama 13th in the nation.

The Bottom Line

If you’re planning to relocate, it’s important to weigh a number of factors including proximity to family, climate, and personal preferences as well as practical considerations like cost of living. 

As Americans live longer and healthier lives, having an affordable retirement vision is more important than ever. Where you decide to settle down can have a big impact on how far your retirement savings will take you and the type of lifestyle you can afford.

If you’re thinking of moving south, Hot Springs , Arkansas, Englewood, Florida, and Charleston , West Virginia are the top three locations worth exploring, along with the rest of the top 10 destinations.

Methodology

The places chosen for the final list were selected from all Census Designated Places in southern states (Alabama, Arkansas, Florida, Georgia, Kentucky, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, and West Virginia). Median household income and monthly housing cost estimates were collected from the 2022 American Community Survey (5-year) for each place in the South. Places for which estimates included large margins of error were removed from the initial list. 

The final list of places was selected by evaluating: 

1. Housing affordability relative to the South (how each place’s monthly housing costs compare with a weighted average for states in the South);
2. Median income in each place (as a proxy for taxes collected, which may be related to community resources; and
3. Individual reporting on proximity to parks or coastlines, recent changes in the community, and previous reporting by Southern Living highlighting the best places to retire.