Best Places in Every State To Live on a Fixed Income
The average Social Security benefit for retired workers in 2021 is $1,548 per month. That comes out to $18,576 in annual benefits for a single person, or $37,152 per year for a couple — about $31,500 less than the U.S. median household income of $68,703, according to the most recent figures from the U.S. Census Bureau.
Living on a fixed income basically means you’re solely or almost entirely dependent on funds such as Social Security, pensions and inheritance, with little to no flexibility in the amount you’re paid each month. Unstable costs, such as a volatile housing market, can be especially challenging to deal with on a fixed income.
If you rely mostly — or solely — on a fixed income, click through to see the best places to live in your state.
Last updated: May 11, 2021
Alabama: Jasper
Alabama might be the best state to retire on a fixed income, especially if you want your retirement nest egg to stretch the furthest. Jasper has a stable housing market, making it a safe choice for those on a fixed income. Home values increased just about 3% year over year, while rents dropped. Additionally, homes are relatively affordable, with the median home value at $122,602.
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Alaska: Fairbanks
Alaska is an income-tax and sales-tax-free state, making it one of the best places to retire on a fixed income. Home values in Fairbanks increased about 4.6% year over year, and the median home value is $190,875 — way below the national median of $269,039. And there is good news for renters, as the median rent in Fairbanks decreased about 2.3% year over year.
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Arizona: Sierra Vista
If you’re thinking of buying a home on a fixed income, consider Sierra Vista — but act quickly. Home values in Sierra Vista rose nearly 10% year over year, making it one of the cities with the largest increase in the past 12 months. Average rents also rose by $12 to $994 a month, but they still are less than the national average.
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Arkansas: Texarkana
Rent prices in Texarkana went up $35 a month year over year, and the current median rent is $897. Texarkana is one of the least expensive places to own a home, though, with the median home value coming in at $107,095.
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California: El Centro
Zillow lists the price of a typical California home at $635,055, but a median-valued home in El Centro is much less at $265,596. Home values rose nearly 11.5% in the past year, above the California average of 10.9%
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Colorado: Pueblo
The median home price in Pueblo is $225,312 but going up fast, increasing about 13.8% year over year. Rent prices have remained stagnant, even decreasing less than 1% year over year to $908 a month.
Connecticut: Newington
Real estate prices in Newington increased 8.2%, with the median home value going up to $242,610. Rent prices went up even more — by about 10.2% — to $1,392 a month.
Delaware: Dover
Delaware is one of the few states that doesn’t levy a state sales tax. It also does not tax Social Security benefits, which makes it one of the best places to retire in the U.S. In the past year, Dover home values rose about 8% to a median of $208,730, while rents increased about 1%.
Florida: Port Orange
Home values in Port Orange went up nearly 7% year over year, with a median home value of $257,376. Rents, however, fell almost 7% over the same time span to an average of $1,108 per month.
Georgia: Statesboro
Home prices in Statesboro are flat, increasing less than one-tenth of a percent year over year to $156,802. Rent prices grew about 1.5% in the same span but remain on the low side at $837 per month.
Hawaii: Pahoa
In uber-expensive Hawaii, Pahoa is an affordable option. Zillow puts the typical home prices in the 50th state at $689,945, but the median home value in Pahoa is just shy of $200,000. That’s up 9.5% year over year. The average rent is close to $1,500 a month.
Idaho: Pocatello
In Pocatello, home values increased more than 13% in the past year, making it one of the biggest gainers in the study. The median home value now is $209,294, which is still about $60,000 less than the national median. Rents went up about 1.5% to $872 per month.
Illinois: Galesburg
The median home value in Galesburg is the lowest in the GOBankingRates study: $72,257. That makes homeownership more accessible for people who live on a fixed income. The average rent also is affordable at $715, and both housing and rental prices remained virtually the same year over year.
Indiana: Richmond
Home prices in Richmond increased about 3.8% year over year to a median value of $97,266. And rent prices also remained stable, with about a 1.2% increase year over year — good news for renters living on a fixed income.
Iowa: Marshalltown
Marshalltown has stable housing and rental markets: Home values increased about 1% year over year, and rent prices increased about 2%. The median home value in the city is $109,436.
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Kansas: Manhattan
In Manhattan, the location of Kansas State University, the median home value is $222,661, up about 3.1% year over year. The average rent fell substantially, dropping about 7.2% to $1,023 a month.
Kentucky: Bowling Green
Bowling Green is a good place for renters on a fixed income to live, but prices are rising. The median rent is $928, up about 3.3% over the past year. A median-priced home costs $183,388, which is almost $90,000 less than the national median but is about a 2.5% rise year over year.
Louisiana: New Iberia
Home values in New Iberia have remained steady, with about a 1.3% increase over the past year to $115,788, while rent decreased almost 3%. Median rent in the city is $846.
Maine: Lewiston
Home values in Lewiston increased about 9.6% over the past year, but with a median home price of $183,802, homes there are still much more affordable than the national median of $269,039. And rent prices are increasing even more: They went up about 11.4% year over year.
Maryland: Cumberland
Home prices in Cumberland increased about 2% year over year, but the median home value is affordable at $95,799. Rent costs remained about the same over the past year, with the average rent at $802.
Massachusetts: Holyoke
The median home value in Holyoke is $231,877. Although this is nearly $40,000 below the national median value, it’s much less than the median home price in the state of Massachusetts as a whole, which is $481,088, according to Zillow. Home values in the city increased about 10.6% year over year.
Michigan: East Lansing
Rent in East Lansing, the home to Michigan State University, increased about 1% year over year to $959. Home values increased 6.4%, however, and the median home value is now $232,615.
Minnesota: Moorhead
Homebuyers on a fixed income can benefit from Moorhead’s stable housing market: Home values increased about 2% year over year to $210,688. Rent went up about $40 per month to an average of $988.
Mississippi: Laurel
The median home price in Laurel is $99,150 — appealing to those on a fixed income. Both home values and rent increased less than 1% year over year.
Missouri: Cape Girardeau
Home and rent prices are both well below the national median in Cape Girardeau: The median home value in the city is $146,348, and rent is $865. The home values rose only about 1.3%, and rents went up nearly 3% year over year.
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Montana: Butte
Renters with a fixed income in Butte shouldn’t have to worry too much about rent hikes: Prices went up less than 2% in the past year to an average of $888. The median home price, however, rose about 6.5% to $157,591.
Nebraska: Grand Island
Housing costs in Grand Island are about $100,000 below the U.S. median. Home values showed nearly a 4.2% growth year over year, bringing the median value in Grand Island to $169.764.
Nevada: Winnemucca
Rental costs in Winnemucca, in the northern part of the state, dropped about 3.4% year over year to $935. The median value of a home is $252,506, about $17,000 below the national figure.
New Hampshire: Rochester
Home values in Rochester were among the biggest risers year over year, increasing by about 11.2% to $254,127. Rent prices barely budged, however, rising just $2 to an average cost of $1,472 over the same period.
New Jersey: Franklin Township
The median home price in pricey New Jersey is $382,096, according to Zillow, but in Franklin Township it is $237,600 — up nearly 10% year over year. Rent prices dropped about 1.5%, but they are the highest in the study at $1,801 on average per month.
New Mexico: Alamogordo
Alamogordo is one of the best places to live on a budget, but prices are rising. The median housing price is $142,108, up about 3.3% year over year. The change in rental price was even higher at 4.3%.
New York: Jamestown
Actress Lucille Ball put Jamestown, the small city of her birth in western New York, on the map. The median value of a home is $77,599 — the second-lowest in the study. Housing is still affordable despite an increase of about 7.1% year over year.
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North Carolina: Jacksonville
Home values are rising while rents are dropping in Jacksonville. Home values increased about 5.4% to $161,796, while rents fell nearly 3%. Still, the average rental cost is $1,027 per month, making it one of 14 cities on the list where rent exceeds $1,000.
North Dakota: Fargo
Home values in Fargo increased about 3.3% over the past year. The rent rose about 4.4%, bringing it to an average of $988 per month.
Ohio: Painesville
The median monthly rent in Painesville is $899, which is nearly 2% more than it was a year ago. Home values in the city skyrocketed more than 7% to a median value of $155,150.
Oklahoma: Shawnee
Shawnee is one of the most affordable cities in this study. The median home value is $85,802, and the median monthly rent is $780. Both increased year over year, however, with home values going up about 2% and rents about 3%.
Oregon: Hermiston
The median home price in Oregon is $409,182, according to Zillow, but in Hermiston it’s $251,313, making it a more affordable option for Oregon residents with a fixed income. The market is shifting, though, with about a 7.6% year-over-year increase in home values. Rents went up nearly 4% to $951.
Pennsylvania: Williamsport
Rents in Williamsport went up more than 4% over the past year to $909, while home values rose about 2%. The median home value is $150,958 — more than $100,000 less than the national figure.
Rhode Island: Woonsocket
The cost of living in the nation’s smallest state, Rhode Island, can be high, but Woonsocket is a more affordable locale for residents on a fixed income. The median home value is below the national average at $256,354, but the cost of rent is about $200 higher than the U.S. price at $1,219.
South Carolina: Myrtle Beach
South Carolina doesn’t tax Social Security benefits. Myrtle Beach is the best place in the state for people on a fixed income because home prices are relatively affordable, with the median home value at $202,169. The rental market dropped almost 10% year over year, with the average monthly rent now $973.
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South Dakota: Aberdeen
Rent is increasing at a clip of nearly 4.5% in Aberdeen, but the average monthly rent is still just $810. Meanwhile, the year-over-year increase in home values was about 2.2%, bringing them to $175.084.
Tennessee: Morristown
People living on fixed incomes can benefit from the low volatility and steady growth of home values in Morristown. The metro area’s median home value rose about 3.5% year over year. Another money-saver for fixed-income residents is rent cost. The median rent in Morristown increased about 2.6% year over year from 2020 but is still below $800.
Texas: Palestine
Palestine’s relatively low housing costs could be beneficial to someone on a fixed income. Home values crept up by less than 2% year over year to $106,516 while rents got cheaper. The average monthly rent is $888.
Utah: Price
The increases in median home value and rent were modest in Price year over year, around 2% for each. The median home value in Price came in at $188,235, with rent at $819.
Vermont: Brattleboro
The median home price in Brattleboro is about $50,000 less than the national median, and the housing market is stable, making it a safe place for someone on a fixed income to buy a home. Home values increased about 3% year over year.
Virginia: Danville
The median home value in Danville is just $88,189, making it an affordable option for those wishing to live on a fixed income in Virginia. It’s also a stable housing market: Values increased about 3.5% over the past year.
Washington: Moses Lake
Home values are on the rise in Moses Lake, increasing nearly 15% to a current median of $252,849. That’s the highest year-over-year rise in the study. Rents, however, have been on the decline, with the average rent decreasing about 2% to $888 per month.
West Virginia: Huntington
Home prices in Huntington are among the lowest compared with the other cities in this study, with the median home value at $89,857. Rent also is among the cheapest at $854 per month, and prices decreased year over year by nearly 3%.
Wisconsin: Stevens Point
Home values in Stevens Point rose nearly 5.4% over the past year to $176,213. Rising home values can help retirees on fixed incomes, especially if prolonged costs wipe out retirement savings, leaving their home as their only financial asset.
Wyoming: Casper
Home values in Casper are increasing, while rent costs are decreasing. Rents dropped nearly 6% over the past year, bringing the median rent price down to a more affordable $989. The median home price went up about 2.7 percent to $223,046.
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Jami Farkas contributed to the reporting for this article.
Methodology: To find the best city in every state to live on a fixed income, GOBankingRates first looked at every city with both Zillow home value data for January 2020, October 2020 and January 2021 available, as well as county fair market rent for both 2020 and 2021 sourced from the U.S. Department of Housing and Urban Development’s data. With all these data points sourced, GOBankingRates then parsed down the list to only include cities that met the following criteria: a size rank according to Zillow of 2,000 or less and a January 2021 home value less than the national average of $269,039.
For these qualified cities, GOBankingRates found: (1) the quarter-over-quarter percent change in home value; (2) the year-over-year percent change in home value; and (3) the year-over-year percent change in rent by county. Those cities with negative values for factors (1) or (2) then were eliminated. With the remaining cities, GOBankingRates scored and combined all three factors, with the lowest score being best. The city with the lowest score from each state was included in our final rankings. These factors were chosen because changes in home values serve as a proxy for measuring the volatility of a housing market, with large increases posing a threat to those living on fixed incomes, while a negative change in value means money is being lost in depreciating house values. However, decreasing rental prices benefit a household on a fixed income.
For Hawaii, Nevada, Utah, and Vermont the size rank criteria had to be enlarged to 5,000. All data was collected on and up to date as of March 8, 2021.
Photo note: The images in this article are for illustrative purposes and may not represent the exact location mentioned.
This article originally appeared on GOBankingRates.com: Best Places in Every State To Live on a Fixed Income
