Top US Cities to Retire With No Savings

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If you have nothing left for retirement, you’re not alone.

About 30% of Americans have $0 saved for retirement Latest data from personal finance website GOBankingRates. Another 33% have less than $50,000 in savings.

If you fall into either category and you’re nearing retirement age, it may be time to start preparing for living on a smaller budget after you stop working, says Ann Lester, retirement expert and author of “Your best financial life: Save smart now for the future you want

“You have to start thinking about how you can start scaling back your lifestyle and gradually get used to having less money to spend after retirement,” she told CNBC Make It.

If you don’t have much money saved in a retirement account like a 401(k) or Roth IRA, you may have to rely on your Social Security benefit to cover your expenses — which may not go very far. This Average Monthly Benefit iAbout $1,773 as of February, according to the Social Security Administration.

With that in mind, GOBanking Rates analyzed The 100 largest US cities with large populations of residents over age 65 to determine the best place to retire with little savings. It ranks each city on a variety of metrics, including the city’s median home price, annual grocery costs, annual utility costs and whether the state taxes Social Security benefits.

The study used data from a variety of sources, including the US Census Bureau’s 2021 American Community Survey, the Tax Foundation and the Bureau of Labor Statistics’ Consumer Expenditure Survey.

Here are the top five places to retire if you don’t have some savings, according to GOBankingRates.

1. Foley, Alabama

  • Percentage of population aged 65 and over: 31%
  • Median 2023 home value: $296,232
  • Taxation of Social Security benefits: No
  • Average annual grocery spending: $4,326
  • Average annual health-care costs: $8,120

2. Mountain Home, Arkansas

  • Percentage of population aged 65 and over: 28%
  • Median 2023 home value: $199,388
  • Taxation of Social Security benefits: No
  • Average annual grocery spending: $4,277
  • Average annual health-care costs: $6,482

3. Hot Springs Village, Arkansas

  • Percentage of population aged 65 and over: 63%
  • Median 2023 home value: $289,418
  • Taxation of Social Security benefits: No
  • Average annual grocery spending: $4,407
  • Average annual health-care costs: $6,749

4. The Village, Florida

  • Percentage of population aged 65 and over: 86%
  • Median 2023 home value: $418,926
  • Taxation of Social Security benefits: No
  • Average annual grocery spending: $4,591
  • Average annual health-care costs: $6,882

5. Bella Vista, Arkansas

How to decide where to retire

Three of the top five places to retire with little savings are in Arkansas, which offers both advantages and disadvantages for retirees on a tight budget.

You can benefit from the state’s relatively cheap cost of living and accommodation, which are 8% and 22% lower than the national average, respectively. According to RentCafe.

However, in exchange for a lower cost of living, you may need to give up some benefits, such as proximity to family or a variety of things to do. While Arkansas offers spectacular natural beauty in the form of hot springs, caves, and forests, for example, you’ll need to travel quite a bit to relax on the beach.

And remember, although a list like this can provide a helpful reference, where you choose to retire will depend on many personal choices other than cost of living. If you’re thinking of moving, a good rule of thumb is to visit your potential retirement destination ahead of time to get a sense of what it might be like to live there long-term.

“If you think relocation is in your future and you have the budget for it, check out a few places to see what’s possible,” Lester says.

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