I Asked ChatGPT Which 11 States Are Best for Retirement – Here’s What It Chose
Choosing where to retire is one of the biggest financial and lifestyle decisions you will ever make. It is not just about warm weather or pretty scenery. It is about how far your money stretches, how good your healthcare is, and whether the local tax system treats you kindly or quietly drains your savings year after year.
So I did something a little experimental. I fed current retirement data, tax rankings, and quality-of-life research into a conversation with ChatGPT and asked it to reason through the best 11 states for retirement in 2025 and 2026. The results were honestly surprising, sometimes counterintuitive, and worth walking through one by one. Let’s dive in.
1. Wyoming – The Undisputed Champion Right Now
Wyoming is not the first place most people picture when they dream about retirement. Yet in 2026, it sits at the very top of almost every major ranking. Wyoming is the best state for retirement in large part due to affordability, with a retiree-adjusted cost of living that falls in the more affordable half of the nation, and the state is considered highly friendly to retired taxpayers, offering the added benefit of no estate or inheritance tax.
Wyoming ranks number one overall, due to its lack of personal income tax and the nation’s lowest rate of multiple chronic conditions among Medicare beneficiaries, at around 44 percent. That health figure is remarkable. It is not just about money saved – it means fewer medical bills to begin with.
Wyoming’s overall quality-of-life factors include the tenth-best elder-abuse protections in the country, the fifth-lowest violent crime rate, and the fourteenth-highest share of residents who do favors for their neighbors. Financially, the state has the seventh-lowest share of residents 65 and over living in poverty. Think about that: affordable, safe, healthy, and community-minded. Wyoming really does check a lot of boxes.
Wyoming has no estate or inheritance taxes, so heirs won’t inherit a state tax bill. The Cowboy State also has one of the lowest sales taxes in the country, with a state sales tax rate of just 4 percent and a combined average state and local rate of 5.56 percent. The tradeoff? Cold winters and fewer doctors in rural areas – but for many retirees, that is a perfectly fair trade.
2. Florida – The Classic That Still Earns Its Reputation
Florida has been a retirement powerhouse for decades, and in 2026 it holds its place firmly at number two in several major analyses. There is a reason Florida is known as a retirement paradise – it ranks as the second-best state to retire due to its relatively low taxes for retired people, including no estate, inheritance, or income taxes. Florida also receives more funding per senior from the Older Americans Act than all but two other states, which funds things like transportation, homemaker assistance, and nutrition programs.
Florida’s quality-of-life strengths include the second-most shoreline miles in the country, the second-most adult volunteer activities, the fifth-most theater companies, and the eighth-most golf courses and country clubs. The state also had the third-lowest death rate for people ages 65 and older, though the overall cost of living is relatively high compared with many other states.
Honestly, Florida’s rising cost of living is real and worth noting. Florida used to rank among the most affordable retirement destinations, but its cost of living has increased quickly over the last five years. Still, the combination of zero income tax, abundant senior resources, and lifestyle perks keeps Florida near the very top of the pack for millions of Americans.
3. South Dakota – Small State, Giant Benefits
South Dakota flies under the radar for many soon-to-be retirees, but the data makes a compelling case. South Dakota offered taxpayer-friendly conditions with no estate or inheritance taxes, the thirteenth-lowest poverty rate for residents 65 and over, and the fourth-lowest percentage of seniors who faced hunger in the previous 12 months, according to WalletHub.
South Dakota ranks as the best state for retirement in the United States by some measures. The average cost of living there is about 4 percent below the national average, including healthcare costs, and the state has one of the highest numbers of arts, entertainment, and recreation businesses per capita. That last point surprises people. It is not just wide open plains – there is actually plenty to do.
South Dakota is the third-most tax-friendly state in the country, with no state income tax, which means Social Security benefits and other retirement income are not taxed at all. The Motley Fool’s analysis also ranked South Dakota among the most affordable states for retirees based on overall cost of living scores. For budget-conscious retirees, South Dakota is a genuine gem hiding in plain sight.
4. New Hampshire – The Safest Bet in New England
Here is where the rankings get genuinely surprising. New England is not what most Americans associate with retirement paradise. Yet New Hampshire has emerged as one of the strongest contenders in the country. According to Bankrate’s 2025 Best and Worst States to Retire study, New Hampshire takes the top spot, where the state’s motto is “Live Free or Die.”
New Hampshire previously taxed interest and dividend income, but fully repealed that tax in 2025. There is also no state sales tax, estate tax, or inheritance tax. However, New Hampshire does have some of the highest median property taxes and property tax rates in the country. So it is not a perfect picture – high property taxes are a genuine consideration for homeowners.
New Hampshire has a cost of living that is about 18 percent above the national average, but this is partially balanced out by the tax situation. The state does not tax Social Security benefits or other retirement income and does not levy any sales tax. Additionally, New Hampshire ranks fifth in the country for the best senior healthcare. For retirees who prioritize safety and medical care above all, this state is tough to beat.
5. Tennessee – Unbeatable Affordability Meets Zero Income Tax
I think Tennessee is quietly one of the most underrated retirement destinations in the whole country. Tennessee ranks fifth for best states to retire, especially for budget-conscious retirees. Tennessee’s cost of living is 12 percent below the national average, and the state does not levy state income taxes, helping retirement income go further. Tennessee’s annual spending for a comfortable retirement is just over $55,000, one of the lowest in the country.
Tennessee has no income tax, so there is no state tax liability on retirement income at all. You also don’t need to worry about leaving heirs with a large state tax bill – Tennessee has no estate or inheritance tax. Plus, there are several relatively affordable places to live throughout the state.
Tennessee is both tax-friendly and affordable for retirees. Whether you are enjoying live music in Nashville, barbecue in Memphis, or the beauty of Great Smoky Mountains National Park, there are plenty of things to do for retirees in Tennessee. The lifestyle variety alone puts Tennessee on a different level from many comparably priced states.
6. Wyoming’s Neighbor: Montana – Natural Beauty With Tax Caveats
Other top-ranked states for retirement in 2026 include Montana, which scored well across measures of affordability, tax policy, and quality of life. Montana is for the retiree who wants space, mountains, and a genuine sense of wide-open freedom. It consistently earns high marks for quality of life and low population density.
It is worth being honest about the tax picture here. Montana repealed several tax deductions, including the partial pension, annuity, and IRA deduction, for the 2025 tax year, though retirees can now deduct up to $5,500 of qualified retirement income. The state’s income tax rate ranges from 4.7 percent up to 5.9 percent for higher income levels.
Montana received special mention from financial analysts at Empower, landing in the top 20 on both the state tax competitiveness and millionaire lists. Montana is not cheap in the way Tennessee or South Dakota is cheap. Still, the combination of natural scenery, low crime, and relatively manageable taxes makes it one of the more compelling choices for active retirees who love the outdoors.
7. Nevada – Sin City Is Quieter Than You Think
Most people hear “Nevada” and think Las Vegas. In reality, retirees from across the country are quietly settling into cities like Reno, Henderson, and smaller communities along the Sierra Nevada foothills. Nevada has no state income tax, estate tax, or inheritance tax, which helps retirees keep more of their money. Property taxes are well below the national average, ranking as the seventh-best rate in the nation. A Nevadan with a home valued at around $268,000 would pay just over $1,600 each year in property taxes.
Nevada has no income tax and a moderate cost of living outside the Las Vegas strip. Reno and Henderson are popular with retirees, and the climate is dry and warm, with mild winters in the southern part of the state. Healthcare can be limited in rural areas, however. That healthcare caveat matters and deserves real consideration before committing to a rural Nevada address.
States like Florida, Wyoming, and Nevada consistently rank as top choices for their lack of income taxes and low property tax rates. Nevada’s warm and dry climate is a genuine bonus for retirees dealing with joint pain or simply craving reliable sunshine. The Silver State offers a lot more than most people give it credit for.
8. Colorado – Where Healthcare Quality Is the Draw
Colorado keeps appearing on retirement lists for a specific reason: the quality of its healthcare system. Colorado offers a strong balance between quality of life and exceptional healthcare access. Healthcare is another metric that affects long-term affordability, and Utah, Colorado, and Vermont were among the top states to retire to for quality healthcare.
Colorado taxes Social Security benefits, but some retirees won’t have to pay. Colorado allows taxpayers aged 65 and older to deduct all their federally taxed Social Security income. Younger retirees under 65 get a smaller tax break. The state currently taxes all taxable income at a flat 4.4 percent rate. So the tax picture is a bit mixed, but manageable for most retirees.
The Rocky Mountain lifestyle is a genuine selling point – world-class skiing, hiking, and one of the most active senior populations in the country. Alaska, Wyoming, New Hampshire, Delaware, and Utah have the lowest poverty rates for senior citizens nationwide, with Colorado also performing well in this area. If you are someone who plans to stay physically active well into your golden years, Colorado arguably offers the best environment to do that in all of America.
9. Iowa – The Quiet Tax Reform Story Nobody Is Talking About
Iowa does not usually appear on dream retirement destination lists. Let’s be real – it is not exactly the Instagram-worthy retirement destination. However, from a pure financial standpoint, Iowa has made dramatic moves that deserve serious attention. The Hawkeye State transitioned to a flat income tax of 3.8 percent and completed the repeal of its inheritance tax in 2025. It also has no estate tax, and residents aged 55 and older do not pay income tax on retirement income. Iowa’s property tax rate is on the higher end, though lower property values help offset the median property tax bill.
That retirement income exemption for Iowans aged 55 and older is a genuinely significant perk that only came into full effect recently. Iowa phased out its inheritance tax effective in 2025, so there is now no inheritance tax in Iowa. Pair that with an affordable cost of living and the state becomes surprisingly attractive on paper.
Both Tennessee and Iowa are on Kiplinger’s list of the top 10 tax-friendly states for retirees, and both states lack an estate or inheritance tax. The key difference is that Iowa still has a state income tax – though it is declining – while Tennessee does not. Iowa will not be for everyone, but for retirees who have family in the Midwest and want to minimize their tax burden, it is worth a serious look.
10. Pennsylvania – A Surprising Tax Shelter for Retirees
Pennsylvania might seem like an unusual entry on a best-retirement-states list, given its reputation for cold winters and higher living costs in certain metro areas. The thing is, Pennsylvania’s tax treatment of retirement income is remarkably generous. Pennsylvania makes the list of tax-friendly places for retirees because it does not tax retirement benefits at all. Even if you have taxable income like wages, the Commonwealth has a flat tax rate of 3.07 percent, which is lower than most states that impose an income tax. Although the median property tax bill in Pennsylvania exceeds $3,200, property taxes are still lower than in some states that do not tax retirement income.
Living in Pennsylvania has numerous tax benefits, ranging from no taxes on Social Security or pension income to a completely tax-free 401(k) withdrawal – a significant financial advantage for retirees drawing down savings. That is a powerful combination for anyone with a traditional pension or a hefty retirement account.
Pennsylvania is among the 15 states that do not tax pension income at all. Cities like Pittsburgh and Lancaster also consistently rank among the most affordable mid-sized cities in the Northeast. For retirees who want access to major cultural amenities, good hospitals, and proximity to family without paying through the nose in retirement taxes, Pennsylvania makes a compelling case.
11. Tennessee’s Neighbor: Alabama – Low Costs, Warm Winters, and an Overlooked Appeal
Alabama rounds out this list, and it is admittedly a state with a mixed story. The cost-of-living case for Alabama is undeniable. Alabama is among the best states for retirement in the United States for affordability reasons. The state has mild winters, beaches, and golf, topped off with a cost of living that is 13 percent below the national average.
Alabama is among the states that fully exempt pension income, meaning retirees receiving state or private pensions pay nothing on that income at the state level. That is a meaningful benefit for retirees living on defined benefit plans or military pensions. Add in Social Security not being taxed, and Alabama’s retirement income tax picture looks genuinely favorable.
Honest caveat: Alabama struggles with some of the worst rankings in aging health, with a very high share of Medicare beneficiaries carrying multiple chronic conditions, as well as limited access to arts and recreational centers. It is hard to say for sure whether the financial savings outweigh the healthcare concerns for everyone – that is a deeply personal calculation. However, for the retiree who prioritizes low costs and warm weather above all, Alabama offers real value that mainstream retirement rankings sometimes underestimate.
