A yearly review conducted by the New York-based Bankrate recently positioned Minnesota as one of the least favorable states for retirees in the US. For retirees considering relocation, Delaware, West Virginia, Georgia, South Carolina, and Missouri emerged as the most advantageous based on multiple key parameters considered by this consumer financial services firm.
Bankrate’s annual evaluation considers a balanced spectrum of criteria including affordability, overall quality of life, health care costs and standards, climate, and crime rates. These factors collectively determined Minnesota’s ranking as 41st on the list for the current year, marking a drop from the 35th spot it held in 2023, primarily due to a decline in affordability.
In both the years, Minnesota demonstrated a commendable performance on health care, securing the 7th position, was ranked halfway through at 25th on well-being, and managed an above-average mark on crime, holding the 17th spot. Albeit, the weather, for which it was ranked 49th, pulled down its aggregate score. The only state ranking lower on the climate front was Alaska, positioned as the least favourable state for retirement as per Bankraten’s rankings.
Kathryn Sutton, Explore Minnesota’s deputy director of marketing, acknowledged the climate challenges of the state: “Although our weather drawbacks are notable, our state’s environment promotes a healthy lifestyle being exceptionally vibrant and arguably more beautiful than several other states.”
Bankrate’s assessment indicated that climate change could potentially influence the desirability of states with preferable weather conditions and warmer climates. States such as Florida, Arizona, and South Carolina, presently popular for retirement, may become less appealing attributable to increased vulnerabilities to natural disasters and a rise in energy costs, in tandem with potential hike in homeowners insurance premiums. This is evident from incidents in Florida, where some insurers have ceased policy extensions for homes.
Within all the evaluated aspects, affordability, which incorporates the cost of living, property taxes, cumulative state and local sales tax, and homeowners insurance, was given the most emphasis. States burdened with higher tax rates, including Minnesota, didn’t perform favourably in this aspect. Minnesota’s latest tax amendments, which broadened the Social Security benefits exemption in the 2023 tax package, might not have been considered in the assessment.
In terms of affordability, southern states emerged as strong contenders and scored impressively overall, regardless of their poor standing in diverse areas. West Virginia, despite being ranked last on the health care scale, received the highest score on the affordability metric, landing it in the second overall spot. Similarly, Mississippi, despite near-bottom rankings for health care and well-being and a poverty rate of almost 20%, ranked as the second most affordable state, claiming the sixth position on the overall list.
Crime rates carried the minimum weight among all factors considered in the study. Nonetheless, for residents like Laura Rubin from Edina, in her 50s and planning retirement with her spouse in Naples, Florida, the escalating crime rates have made the otherwise delightful Minnesota less enticing.
Laura Rubin, who along with her spouse owns multiple housing properties in Minneapolis, expressed dissatisfaction over the rising crime rate, “It’s frustrating and feels like our efforts to deal with the situation are falling on deaf ears. The issues that we previously managed through hard work and resilience now seem entirely beyond our control, leaving us with no option but to consider relocation.”
It’s important to remember that taxation plays a critical role in supporting state infrastructure and ensuring the overall health and quality of life for residents,” added Rubin, referring to the necessity of taxes in maintaining balanced societal structure.
It is noteworthy that the perception of retirement suitability can vary depending on the consulted source. WalletHub, in their annual “Best and Worst States to Retire” list, positioned Minnesota significantly higher than Bankrate, at the 8th spot, not considering the impact of the state’s weather.
Various factors reviewed in these studies, including health care, well-being, crime rate, and affordability, all intersect and influence an individual’s choice of retirement state. The variation in rankings may often hinge on the weight given to individual parameters in the methodology of these studies.
Ultimately, the suitability of a state for retirement is deeply personal, reflecting individual preferences across a range of factors – from climate to cost of living. Therefore, while overall rankings provide insightful information, the decision should be driven by an individual’s specific needs, preferences, and life goals.