10 Best States To Retire in USA if You’re an Expat
If you're an expat eyeing retirement in the United States, or already living here, you’ve likely realized that choosing the right state can make or break your golden years.
Beyond the picture-perfect postcards of beaches and sunshine, the states where you can retire in the USA offer something far more valuable: financial security, affordable living, and a retirement lifestyle that works for you.
As an international retiree, you’re not just looking for low taxes, you’re looking for a place where your retirement income stretches further, where quality medical care is close by, and where the community feels familiar, yet new.
Taxes are one of the biggest things that can affect your retirement experience in the US. From income tax to property taxes, knowing what each state does, or doesn’t charge, can make a huge difference to your monthly budget.
Taxes can quickly eat into their savings for expats living on retirement income, such as social security benefits, pension income, or money from retirement accounts.
Fortunately, several states offer full or partial tax exemptions on social security income and retirement account withdrawals. This means you keep more of what you’ve earned, which is essential when managing a fixed income.
States like Florida, South Dakota, and Wyoming are especially popular because they don’t tax social security or pensions, helping expats stretch their budgets further without surprise deductions.
If you plan to buy a home or leave assets to loved ones, be aware of a state’s property taxes and any estate or inheritance taxes.
Some states may offer homestead exemptions or senior-specific relief programs to reduce your annual tax burden, while others might impose inheritance tax rates on your heirs.
Looking into these ahead of time can help you avoid unwanted costs and ensure a smoother transition into retirement living in the US.
Many expats focus on state income tax and forget about sales tax. But depending on where you live, daily purchases, from groceries to personal care, could come with high sales tax rates.
Some areas also apply local sales tax on top of the state rate, making living costs slightly higher than expected. That’s why it’s important to check state and local taxes when planning where to settle, especially if you live on a budget.
It’s not all about the numbers. While taxes and costs are important, retirement is also about enjoying your time, staying healthy, and feeling at home in your community.
As we age, access to reliable, affordable health care becomes more and more important. Some states are better than others when offering quality medical care, especially in areas with large retiree populations or well-established retirement communities.
For expats, choosing a state with strong healthcare networks and providers used to working with international patients can make a big difference in their day-to-day experience.
Finally, consider what will make your retirement rewarding. Are you seeking peace, quiet, outdoor adventures, or a cultural scene?
Some of the best states to retire in offer more than tax savings. They provide access to natural beauty, golf courses, walkable towns, festivals, museums, and more.
From tax friendliness and low cost of living to affordable housing and quality medical care, the following states consistently rank among the best to retire, especially if you rely heavily on retirement income like social security benefits, pension income, or retirement account withdrawals.
South Dakota continues to lead many retirement rankings, and it’s easy to see why. The state has no state income tax, which means your social security income, pension income, and retirement account withdrawals are completely tax-free.
It also has low property taxes, no estate or inheritance taxes, and one of the lowest tax burdens in the country. These factors make it especially appealing to expats living on a fixed income.
On top of the financial perks, retirees enjoy a calm lifestyle surrounded by scenic parks, friendly small towns, and a strong sense of community.
While New Hampshire has high property taxes, it offsets that with excellent tax advantages elsewhere. The state imposes no income tax on retirement income, wages, or social security benefits.
It also has no sales tax, making it ideal for expats looking to cut everyday expenses. Safe communities, access to quality medical care, and plenty of outdoor activities make this state a great fit for those who enjoy small-town charm and financial simplicity.
Florida has long been a favorite for many retirees, and it’s just as attractive to expats. The state offers no income tax, meaning your social security, pensions, and retirement accounts aren’t taxed.
In addition, Florida provides homestead exemptions that help lower property taxes, making it easier for seniors to manage their homes long-term.
With warm weather year-round, well-established retirement communities, and excellent healthcare systems, Florida is a sunny and practical option for expats seeking comfort and affordability.
South Carolina offers a well-rounded retirement experience with a strong focus on affordability. The state does not tax social security benefits and offers generous pension and other retirement income deductions.
South Carolina also has low property taxes and an overall low cost of living. Expats will appreciate the mild climate, relaxed pace of life, and access to coastal cities and historic towns.
With its tax-friendly policies and active senior support programs, South Carolina remains a smart pick for international retirees.
With some of the lowest housing costs in the country, West Virginia is gaining attention as a budget-friendly retirement state. Recent tax reforms have made it more accommodating to retirees, especially in handling retirement income.
The state is also investing in its healthcare infrastructure, and many of its small towns offer a quiet, welcoming atmosphere. West Virginia is a top contender for expats looking to retire somewhere peaceful, practical, and affordable.
Wyoming stands out for its outstanding tax friendliness. The state has no income tax, low sales tax rates, or low property taxes.
Wyoming also imposes no estate or inheritance taxes, making it ideal for retirees who want to preserve their savings and reduce long-term expenses.
Beyond the numbers, Wyoming offers beautiful landscapes, fresh air, and wide-open spaces, perfect for expats seeking peace and privacy in retirement.
For expats looking for balance, Pennsylvania offers a mix of affordability and cultural richness. The state does not tax social security income, pension withdrawals, or IRA distributions, a major benefit for retirees living on multiple income sources.
While it does have inheritance taxes, spouses and certain heirs are exempt. With access to cities, peaceful countryside, and reputable healthcare institutions, Pennsylvania is a practical and pleasant option for retirement.
Though its winters can be challenging, North Dakota offers a warm welcome regarding finances. It boasts low property taxes, minimal sales tax, and affordable housing costs, making it one of the most affordable states for retirees.
The state also ranks high in quality of life, with low crime rates, clean cities, and a focus on community values. Expats who value stability and are comfortable with colder weather may find North Dakota a surprisingly rewarding retirement place.
New Mexico blends affordability with culture. It has low housing prices, a low cost of living, and several deductions designed to help retirees reduce their taxable income.
While the state does tax social security, other credits and exemptions for seniors can help offset this. Expats are drawn to New Mexico not just for its cost savings but also for its rich history, diverse population, and scenic surroundings, which make it a truly unique retirement destination.
Michigan offers a balance of affordability, recreation, and access to care. The state provides tax breaks on certain types of pension income and features low property taxes in many areas.
Retirees can find affordable housing in scenic towns near Lake Michigan. These towns also have strong medical networks, local culture, golf courses and outdoor spaces. Michigan is an underrated but solid retirement choice for expats who enjoy seasonal living and small-town energy.
While the 10 best states to retire in the USA stand out for various reasons, others deserve attention. They may not check every box, but depending on your lifestyle, taxable income, and retirement goals, these could still be solid options for expats:
Arizona has great weather, scenic landscapes, and a year-round international retiree population. Arizona offers a strong sense of community for expats. It has a fair tax climate and no tax on social security benefits, but it does tax other forms of retirement income. Though sales tax rates can be high in some counties, the overall cost of living remains reasonable.
Tennessee has no state income tax, making it attractive for expats relying heavily on social security income or pension withdrawals. However, local sales tax can push up everyday expenses, especially in more urban areas. Still, with low housing costs and a cool culture, it’s worth considering.
Delaware offers one of the lowest tax burdens in the US. It does not tax Social Security, and there are generous breaks on other retirement income. Plus, property taxes are among the lowest in the country. Delaware is an excellent option for expats who prefer coastal living in a quiet, tax-friendly state.
Not every state is ideal for retirees, especially those on a fixed income or seeking long-term tax relief. If you're an expat, here are a few red flags to be aware of when evaluating states to retire:
Some states offer great amenities and scenery, but have high property taxes and elevated housing prices.
While they may offer a rich cultural experience or world-class healthcare, the tax burden and cost of living often exceed the national average, making it tough to maintain financial comfort without a substantial income.
For expats adjusting to a new system, especially those juggling finances between countries and managing their health insurance for expat coverage.
These states may pose more challenges than benefits. Complex tax rules, rising expenses, and higher-than-average local taxes can quickly chip away at your retirement budget, leaving little room for comfort or security.
Another area to watch is inheritance and estate taxes, especially if you plan to pass on assets to your family. States like Maryland, Iowa, and Rhode Island impose inheritance tax rates that could affect your long-term planning.
While some offer exemptions for spouses and children, these policies can be confusing and differ significantly from what you’re used to overseas.
Before settling down in any state, it's smart to consult with a tax advisor familiar with US and international law, especially if you're managing retirement accounts, property, or social security benefits as a non-citizen.
No matter how picturesque or popular a state may be, retirement planning is ultimately about your numbers. For expats, especially those navigating unfamiliar tax systems, calculating what you’ll keep versus what you’ll spend is crucial before choosing your new home.
Start by estimating your taxable income, including social security benefits, pension income, retirement account withdrawals, and other retirement income, after accounting for state income tax exemptions or deductions.
Some states don’t tax social security, while others offer partial relief or tax it in full. Be sure to check how your residency status as an expat might affect eligibility for these benefits or deductions.
Knowing where your money will be taxed and how much can help you avoid surprise deductions later, especially in states with high tax rates or complicated local taxes.
Beyond taxes, consider your regular fixed costs. These include housing costs (whether you rent or own), property taxes, healthcare premiums, local sales tax, transportation, and utilities.
States with low median home values or generous homestead exemptions can significantly lower expenses. Similarly, watch out for areas with high property taxes or costly sales tax rates that might inflate your everyday spending.
For expats managing a fixed income, keeping these core expenses predictable and manageable is essential.
Finally, compare what you’re bringing in versus what’s going out. A state may look affordable but eats away at your savings through hidden taxes or rising living costs.
Conversely, a state with higher housing prices might offer good tax benefits that allow you to retain more of your income long-term.
To make the best decision, factor in both your financial goals and personal priorities, whether that’s being close to family, living in a retirement community, or waking up to natural beauty. The key is finding the right balance between comfort, cost, and convenience.
Choosing where to retire in the US as an expat is about finding a state that fits your lifestyle, supports your finances, and feels like home. The states to retire in the USA stand out because they offer the right mix of low taxes, affordable housing, and a welcoming environment for retirees from all walks of life.
If you’re weighing your options or getting ready to make the move, it helps to have the right support. At WellAway, we’re here to guide expats like you through every step of the journey, from healthcare coverage to retirement planning. You’ll also find more helpful resources and expert insights for international retirees.
Retirement should feel like a reward, not a worry. So take your time, research, and choose the place that makes the most sense for you. After all, the best retirement lets you enjoy what matters most.