Best Places To Retire In 2022: Sioux Falls And Other Hot Spots

Taxes

Forbes compared more than 800 locales in America on everything from housing costs and taxes to healthcare, air quality, crime and climate change and natural hazard risk. These are the top 25 cities for retirees.

After 30 years in Orange County, Calif., Rex and Barbara Scott picked up last year and moved to Sioux Falls, South Dakota. They’re now a three-hour plane ride from their two kids and six grandkids in California, but Rex, now 66, and Barbara, now 62, found the economics of the move compelling. By selling their two-story, 4-bedroom, 2-bath house just a few miles from the beach and Disneyland for nearly $1 million, they were able to buy a slightly larger split-level house in Sioux Falls mortgage free—at a fourth the price per square foot, Rex figures—with plenty of cash left over to help finance their retirement in a lower-cost, lower-tax locale.

Barbara, who worked in human resources for a health care system (particularly stressful during Covid-19), now happily puts in 25-to-30 hours a week as a grocery store clerk. As for Rex, after 20 years toiling away at Home Depot, he has returned to his first love—performing in a musical group. In fact, the couple met 45 years ago in Sioux Falls, while Rex was a drummer and vocalist for a short-lived hard rock band, ROX, that was inducted last year into the South Dakota Rock and Roll Hall of Fame.

Not every sixty-something is looking to return to their rock ‘n roll roots. But many baby boomers are now, as the Scotts were, sitting on huge gains in home equity that could provide a cushion in retirement—if they’re ready to move to lower-cost areas.

That, and the current inflationary pressure on retirees’ budgets, makes Forbes’ 2022 list of the Best Places To Retire particularly timely. The latest report from the National Association of Realtors puts the country’s median home price at $375,300, up a sharp 15% from a year before. But Sioux Falls, one of our 25 picks for the second-straight year, has a median home price of just $296,000, about average for our list. In fact, only three of our picks have prices above the national median and two of our 2021 favorites—Asheville, N.C., and Wenatchee, Wash.—were knocked off this year mainly for their steep home prices. That’s because this list aims to highlight places that provide a high quality of retirement living at an affordable price.

The Scotts used the Forbes list, among others, to research potential spots. They ruled out nearby Arizona. “Too hot,” Rex says. Same with Florida, plus the threat of hurricanes worried them. Undeterred by cold winters, the Scotts considered the Lake region of western Minnesota, Rex’s home state, but balked at its high state income tax. South Dakota has no state income tax.

Another consideration in today’s hot real estate market: the Scotts had a Sioux Falls real estate agent they trusted—Rex’s cousin, John Maurer of Weichert Realtors—The Agents. After the Scotts were outbid on three homes, Maurer found them a house that was about to be listed and helped them fashion an above-asking-price all cash offer good for only 12 hours. It worked.


Fargo, N.D  remains the only city on the list for all 12 years we’ve put it together.


Not up for cold winters? The majority of our picks are in warmer climates, though we do include choices in 18 states across all four continental time zones. Far-north Fargo, N.D remains the only city on the list for all 12 years we’ve put it together.

Perhaps 11 of the places on our new list could be considered college towns, which offer convenient opportunities for lifelong learning and great cultural and dining options, particularly for their size. In the early days of the pandemic, some of these spots became near ghost towns, leading us to knock many of them off the 2020 list. But now life in these towns is back close to normal. For the third year in a row, we take climate change and natural hazard risks into account, along with such longer-standing metrics as living costs, taxes, air quality, crime and availability of doctors. You can read more about our methodology and sources below the list.


A-F

Athens, Georgia

Classic college town (University of Georgia) of 130,000, 70 miles east of Atlanta.

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PROS: Median home price of $289,000 is 23% below national median. Big culture scene. Good climate and air quality. Social Security benefits plus up to $65,000 per person of other retirement income exempt from state income tax. No state estate tax.

CONS: Doctors per capita below national average. Not very walkable. Serious crime slightly above average. So-so economy.


Charlotte, North Carolina

Thriving banking and business center of 899,000 in the Piedmont Plateau center of the Carolinas.

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PROS: High number of doctors per capita. Good climate and air quality. Strong economy. No state estate tax or income tax on Social Security.

CONS: Median home price of $378,000, 1% above national median. Serious crime rate above national average. Not very walkable.


College Station, Texas

Home of Texas A&M University and a population of 124,000, 85 miles northwest of Houston.

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PROS: Median home price of $304,000, 19% below national median. Abundant doctors. Good air quality, relatively low natural hazard risk. Low crime rate. Very bikeable. No state income or estate tax. Good economy.

CON: Not very walkable


Columbia, Missouri

Multiple college town (University of Missouri, Stephens College, Columbia College) of 125,000, midway between St. Louis and Kansas City.

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PROS: Median home price of $259,000, 31% below national median. Lots of doctors. Comfortable climate, good air quality, low natural hazard risk. Good economy. No state estate tax.

CONS: State income tax on Social Security. Higher than average crime rate. Not very walkable.


Fargo, North Dakota

North Dakota’s largest city, population 126,000, adjoining Minnesota on the Red River of the North.

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PROS: Median home price of $271,000, 28% below national median. Plenty of doctors. Good air quality. Very bikeable. No state estate tax. Relatively low natural hazard risk.

CONS: Cold winters. State income tax on Social Security. Serious crime slightly above national average for city.


G-R

Greenville, South Carolina

Blue Ridge Mountains foothill city of 76,000 in South Carolina’s Upstate region, midway between Atlanta and Charlotte.

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PROS: Median home price of $281,000, 25% below national median. High number of doctors per capita. Good climate and air quality. Strong economy. No state estate tax. Social Security, plus $25,000 per person of other retirement income exempt from state income tax.

CON: Serious crime rate above national average.


Iowa City, Iowa

Famous college town (University of Iowa) of 76,000 in southeastern Iowa.

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PROS: Median home price of $260,000, 31% below national average. Lots of physicians. Comfortable climate, good air quality. Very bikeable. Low serious crime rate. Good economy. No state income tax on Social Security.

CONS: Cold winters. State inheritance tax.


Jacksonville, Florida

With a population of 939,000, Florida’s largest city, sitting in northeastern corner on Atlantic Ocean.

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PROS: Median home price of $288,000, 23% below national median. Somewhat less prone to hurricanes than most coastal Florida cities. Plenty of doctors. Lots of parks. Good air quality No state income or estate tax.

CONS: Serious crime above national average. Not very walkable.


Knoxville, Tennessee

Vibrant college town (University of Tennessee) and navigable river city of 193,000 in scenic eastern Tennessee.

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PROS: Median home price of $308,000, 18% below national average. Abundant doctors. Comfortable climate. Good air quality. Strong economy. No state income or estate tax.

CONS: City’s serious crime rate is above national average.


Lawrence, Kansas

Classic college town (University of Kansas) of 101,000, 40 miles west of Kansas City.

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PROS: Median home price of $279,000, 26% below national median. Good ratio of physicians per capita. Good air quality and comfortable climate. Very bikeable. Good economy. No state estate tax. Relatively low risk for natural hazards.

CONS: Serious crime above national average. Social Security benefits taxed for those earning above $75,000.


Lexington, Kentucky

Self-styled “Horse Capital of the World” and college town (University of Kentucky, Transylvania University) of 325,000, in central Kentucky.

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PROS: Median home price of $273,000, 27% below national median. Excellent ratio of physicians per capita. Low serious crime rate. Social Security, plus up to $31,100 per person of retirement income, exempt from state income

CONS: So-so economy. State inheritance tax.


Lincoln, Nebraska

Double-duty state capital and college town (University of Nebraska) of 298,000, 50 miles southwest of Omaha.

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PROS: Median home price of $259,000, 31% below national median. Good air quality, comfortable climate. Very bikeable. Strong economy. No state estate tax.

CONS: State income tax on Social Security. Serious crime rate slightly above national average.


Madison, Wisconsin

Lake-festooned state capital and college town (University of Wisconsin) of 278,000, 150 miles northwest of Chicago.

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PROS: Median home price of $365,000, 3% below national median. Lots of doctors. Good air quality. Very walkable and bikeable. Low serious crime rate. Strong economy. No state tax on estates or Social Security. Low risk of natural hazards.

CONS: Cold winters.


Pittsburgh, Pennsylvania

River and college city (Carnegie Mellon University, University of Pittsburgh, Duquesne University, Chatham University) of 299,000.

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PROS: Median home price of $234,000, 38% below national median. Lots of doctors. Very bikeable and walkable. Comfortable climate (despite cold winters). No state income tax on Social Security or most retirement income.

CONS: Serious crime rate above national average. State inheritance tax. So-so economy. Air quality issues.


Roanoke, Virginia

Scenic Blue Ridge Mountains city of 100,000, 240 miles southwest of Washington, D.C.

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PROS: Median home price of $225,000, 40% below national median. High number of doctors. Good air quality. Comfortably mild climate. Somewhat walkable and bikeable. No state tax on estates or Social Security. Relatively low natural hazard risk.

CONS: So-so economy. Serious crime rate above national average.


Rochester, Minnesota

River city home of famed Mayo Clinic and 125,000 people, 85 miles southeast of Minneapolis.

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PROS: Median home price of $316,000, 16% below national median. Extremely high ratio of doctors per capita. Good air quality. Low serious crime rate. Very bikeable. Strong economy. Relatively low natural hazard risks.

CONS: Cold winters. Not very walkable. Income tax on Social Security benefits. State estate tax.


S-W

San Antonio, Texas

Vibrant South Texas city of 1.6 million people, making it country’s seventh-most populous city.

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PROS: Median home price $287,000, 24% below national median. Good air quality. Strong economy. No state income or estate tax. Very bikeable.

CONS: Serious crime rate above national average. Relatively high natural hazard risk. Not very walkable.


Savannah, Georgia

Graceful river city of 162,000, 30 miles inland from Atlantic Ocean.

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PROS: Median home price of $260,000, 31% below national median. Good air quality, comfortable climate. Very bikeable. Good economy. Social Security benefits plus up to $65,000 per person of other retirement income exempt from state income tax. No state estate tax. Relatively moderate natural hazard risk.

CON: Serious crime rate slightly above national average.


Sioux Falls, South Dakota

Rolling river town of 201,000 in southeastern South Dakota, 240 miles southwest of Minneapolis.

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PROS: Median home price of $296,000, 21% below national median. Excellent ratio of physicians per capita. Good air quality. Very bikeable. Very strong economy. No state income or estate tax. Relatively low risk of natural hazards.

CONS: Cold winters. Serious crime rate above national average. Not very walkable.


Spokane, Washington

Scenic river city of 232,000, 280 miles east of Seattle.

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PROS: Good ratio of physicians per capita. Good air quality. Very bikeable and pretty walkable. Strong economy. No state income tax. Relatively low national hazard risk.

CONS: Median home price of $411,000, 10% above national median. Cold winters. Serious crime rate above national average. State estate tax.


Sun City, Arizona

Age-restricted Phoenix suburb of 43,000 aimed at physically active retirees.

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PROS: Median home price of $303,000, 17% below national median. Strong economy. No state estate tax or income tax on Social Security. Adequate doctors.

CONS: Hot summers. Poor air quality. Relatively high natural hazard risk. Not very walkable.


Tucson, Arizona

Sonoran Desert city of 558,000 with major college (University of Arizona), 65 miles north of Mexican border.

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PROS: Median home price of $312,000, 17% below national median. High number of doctors per capita. Very bikeable, somewhat walkable. Strong economy. No state estate tax, or income tax on Social Security earnings.

CONS: Poor air quality. Serious crime above national average. Relatively high vulnerability to natural hazards.


The Villages, Florida

Fast-growing senior-citizen-oriented town of 132,000, 50 miles northwest of Orlando.

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PROS: Mild winters. Good air quality. Low serious crime rate. No state income or estate tax. Relatively moderate national hazard risk. Strong economy. Somewhat bikeable.

CONS: Median home price of $388,000, 3% above national median. Not very walkable. Physicians per capita below national average.


Virginia Beach, Virginia

Beach-lined city of 460,000, Virginia’s largest, 200 miles south of Washington, D.C.

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PROS: Median home price of $363,000, 3% below national median. Adequate ratio of doctors per population. Good air quality, comfortable climate. Somewhat bikeable. Very low serious crime rate. No state estate tax or tax on Social Security income.

CONS: So-so economy. Not very walkable.


Winston-Salem, North Carolina

Cultured city of 252,000 in the Piedmont area of North Carolina, 80 miles northeast of Charlotte. Home to Wake Forest, Winston-Salem State, University of North Carolina School of the Arts and Salem College.

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PROS: Median home price of $219,000, 42% below national median. High ratio of physicians per capita. Comfortable climate, good air quality. Good economy. No state estate tax or income tax on Social Security. Relatively moderate vulnerability to natural hazards.

CONS: Serious crime rate above national average. Not very bikeable.


2022 Methodology

We compiled data on more than 800 places with populations above 10,000, in every state and, yes, the District of Columbia. The primary factors we take into account involve money, including median home prices and overall cost of living, both compared to national measures, and state taxes, including income tax exemptions for Social Security and other retirement income, and state estate/inheritance taxes. We also consider the strength of the local economy, since many retirees look for part-time work and eventually might want to sell their home and relocate again.

Quality of life is equally important to our list, so we look at a number of non-economic indicators, ruling out cities with too high rates of serious violent crime or too few primary care doctors per capita. We also take into consideration factors that promote an active retirement, including air quality and ratings for walkability (how easy it is to shop and get to places on foot) and bikeability (whether dedicated lanes and other measures make it easy to bike around town).

Since you don’t want to relocate then suddenly find yourself scrambling for higher or safer ground, we weigh each area’s vulnerability to climate change and natural disaster risk, using the FEMA National Risk Index for Natural Hazards, which calculates for every county a vulnerability measure embracing 18 natural hazards, including flooding, hurricanes, landslides, earthquakes and wind. We exclude places assigned a “very high” risk rating.

Our full write-up for each of our picks includes extra information that may be of interest, but didn’t influence our choice. This includes county-wide results in the 2020 presidential election and the percentage of a county’s population that is fully vaccinated for COVID-19 with at least one booster.

Sources for our data include the FBI, the U.S. Environmental Protection Agency, the U.S. Bureau of Labor Statistics, individual state tax departments, zillow.com, trulia.com, bestplaces.net, neighborhoodscout.com, the National Association of Realtors, the Centers for Disease Control and Prevention, countyhealthrankings.org, walkscore.com and the League of American Bicyclists. Our characterization of local economies comes from the Milken Institute’s just-released report, Best-Performing Cities 2022.

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