How do I compare states for retirement?

Income tax first, but on your income. In 2026, eight states have no individual income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, and Wyoming. Washington taxes only capital gains. Top rates elsewhere run from 2.5% to 13.3%, per the Tax Foundation. Then check how each state treats your pension, IRA withdrawals, and Social Security.

Then the taxes you pay no matter your income. Five states have no statewide sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon. Combined state and local rates at midyear 2026 range up to 10.13% in Louisiana. Property tax depends on the county and your home's value, so price the actual home you would buy.

Housing and health care come next. Compare what the home you want costs to buy or rent, plus insurance. For health care, check distance to hospitals and specialists. With Original Medicare you can use any doctor or hospital that takes Medicare anywhere in the U.S. Medicare Advantage plans may require you to use providers in the plan's network and service area, so a move can mean a new plan.

Last, the things that do not show on a tax table: distance from children and grandchildren, and climate risk. FEMA's National Risk Index shows natural hazard risk, such as flooding and wildfire, by area.

What the rule of thumb misses: lists of the best states for retirees use average incomes. Your result depends on how much of your income is Social Security, pension, or withdrawals, and on what you own.