Money & Policy

The Best and Worst U.S. Cities to Retire (Perhaps)

Bankrate's intriguing list leaves out one key measurement

The popular personal finance site Bankrate.com is out with its first-ever list of The Best (and Worst) Cities to Retire. But whether you’ll agree with its choices depends on how you expect to retire.

Bankrate ranked the best states to retire in March. Now it’s back with a list comparing 172 U.S. cities, big and small. (In some cases, Bankrate lumped together nearby cities as one location because the data was so similar, which might rankle, say, the residents of Rochester, N.Y., who are now effectively Buffalonians.)

“When you do a state ranking, the weakness is that a state’s urban and rural areas are taken together,” says Chris Kahn, Bankrate’s research and statistics analyst, who’s based in Brooklyn, N.Y. “It’s like saying the retirement experience in Manhattan is the same as in the Finger Lakes in upstate New York. This time, I wanted to drill down further with a cities list, which is much more challenging to do.”

New York City is a great place for a lot of things. But it has a high cost of living and high tax rates.

— Chris Kahn

Top 10 Cities to Retire

Bankrate’s 10 Best Cities are mostly in the South, with a heavy Arizona presence (see a slideshow at the end of this blog post for details about them):

1. Phoenix, Ariz. (including Mesa and Scottsdale)

2. Arlington/Alexandria, Va.

3. Prescott, Ariz.

4. Tucson, Ariz.

5. Des Moines, Iowa

6. Denver, Colo.

7. Austin, Texas

8. Cape Coral, Fla. (including Ft. Myers)

9. Colorado Springs, Colo.

10. Franklin, Tenn.

“Arizona cities dominated the list for a few reasons,” said Kahn. “They have really nice weather, especially in the winter; they’re in one of the lower-taxing states in the country and residents of Phoenix, Prescott and Tucson gave their cities good well-being scores.”

Arlington and Alexandria, Va., made the Top 10 for completely different reasons. “The state has very good health care and the area got high marks for walkability and a low crime rate,” said Kahn. “The knock on Arlington and Alexandria is the high cost of living.”

Des Moines was “the biggest surprise,” said Kahn. “The cost of living is extremely low and there’s a really good health care system. Des Moines also had high well-being scores.”

10 Worst Cities to Retire

The 10 Worst Cities to retire, according to Bankrate, are mostly in the Northeast:

172. New York, N.Y.

171. Little Rock, Ark.

170. New Haven, Conn. (including Stamford, Norwalk, Bridgeport and Milford)

169. Buffalo, N.Y. (including Rochester and Niagara Falls)

168. Newark, N.J.

167. Albany, N.Y. (including Troy and Schenectady)

166. Hartford, Conn.

165. Oakland, Calif.

164. Indianapolis, Ind.

163. Cleveland, Ohio

“New York City was at the bottom of the list for the same reasons New York State was in our other ranking,” said Kahn. “Although it’s a great place for a lot of things — it has great museums and is the most walkable city in the country and the crime rate is low — it has a high cost of living and high tax rates.”

Plus, he added, there’s the winter weather, which also hurt scores for New Haven, Buffalo, Newark, Albany and Hartford.

Little Rock came in next to last because of its “below-average health care system, high taxes, high crime rate and weather,” said Kahn.

How the Ranking Was Done

Bankrate ranked the cities on criteria in seven categories, each weighted equally:

  • Weather (the more moderate the temperatures and fewer the snow and rain storms, the better)
  • Health care quality (state scores from the U.S. Agency for Healthcare Research and Quality on roughly 160 health-related issues)
  •  Cost of living
  •  Tax rate
  •  Crime rate (the FBI’s property and violent crime statistics)
  •  Well-being (using data from Healthways, a wellness company, on what people 65 and older say about community satisfaction, pride and happiness)
  • Walkability (WalkScore.com’s measurement of how easy it is to get around without a car)

What Wasn’t Included

What surprised me was that Bankrate didn’t factor in the job market and the local economy.

After all, 67 percent of workers plan to work for pay in retirement, according to the 2015 Retirement Confidence Survey of the Employee Benefit Research Institute. And other best-places-to-retire surveys, such as ones from Forbes and the Milken Institute, include an area’s economic strength in their rankings. (Milken calls its list The Best Cities for Successful Aging, so it’s not technically a list of best places to retire.)

“Retirement to us meant not working,” said Kahn. “Maybe we will include the local job market and the economy the next time.”

Best States vs. Best Cities

Another oddity: the striking differences between the areas showing up in Bankrate’s Best States to Retire and its Best Cities to Retire. Six of the Top 10 Best States weren’t represented in Bankrate’s Top 10 Best Cities list. So although Wyoming, Utah, Idaho, Montana, South Dakota and Nebraska are among the nation’s best states to retire in Bankrate’s eyes, none of their cities took top honors in the site’s new list.

That’s because Bankrate used different data sources for the two lists and because some cities score better or worse than the states they’re in on the same criteria.

If you are considering relocating for retirement, it’s worth noting that only two of Forbes’s 25 Best Cities to Retire (Colorado Springs and Tucson) and only one in the Milken Institute’s Best Cities for Successful Aging (Des Moines) are in Bankrate’s Top 10.

To me, this goes to show that different criteria and weightings can produce vastly different lists. It also speaks to the importance of not moving anywhere for retirement based wholly on any one list you see. Here’s a slideshow of Bankrate’s Top 10:

RIchard Eisenberg, editor at Next Avenue wearing a suit jacket in front of a teal background.
By Richard Eisenberg
Richard Eisenberg is the Senior Web Editor of the Money & Security and Work & Purpose channels of Next Avenue and Managing Editor for the site. He is the author of How to Avoid a Mid-Life Financial Crisis and has been a personal finance editor at Money, Yahoo, Good Housekeeping, and CBS MoneyWatch. Follow him on Twitter.

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