When it comes to planning for retirement, many individuals wonder how far their savings, combined with Social Security benefits, will take them. For those with $250,000 in savings, plus the monthly Social Security check, the reality varies significantly depending on where you live. The cost of living, housing prices, healthcare, and other factors all play a significant role in how long these funds will last in different states. Here’s a breakdown of how far $250,000 in savings, plus Social Security, will go in each state.
Factors Affecting the Longevity of $250,000 in Savings Plus Social Security
Several key factors determine how far your savings will last:
- Cost of Living: States with a lower cost of living, including cheaper housing and goods, will make your savings last longer.
- Healthcare Costs: Healthcare is a significant consideration, especially for retirees. States with higher healthcare costs will see your savings depleting faster.
- Housing Costs: The cost of renting or owning a home can vary greatly from state to state, affecting how far your money will go.
- Social Security Benefits: Social Security payments, which are based on your earnings history, vary across individuals, but the national average is approximately $1,600 per month.
Here’s an overview of how $250,000 in savings, combined with the average Social Security payment, plays out in different states.
States Where $250,000 and Social Security Go the Furthest
1. Mississippi
Mississippi consistently ranks as one of the cheapest states to live in. The cost of living is well below the national average, particularly for housing. In Mississippi, $250,000 in savings combined with Social Security can stretch quite far, providing ample funds for housing, healthcare, and day-to-day living.
2. Arkansas
Similar to Mississippi, Arkansas offers a low cost of living, especially in rural areas. The combination of affordable housing and lower-than-average healthcare costs means that $250,000 plus Social Security could comfortably cover living expenses for a long time in this state.
3. Oklahoma
Oklahoma’s cost of living is also much lower than the national average. Housing is affordable, and utilities are reasonably priced. With $250,000 in savings and Social Security benefits, retirees can expect to live comfortably for a number of years.
4. West Virginia
West Virginia is known for its affordable housing market and relatively low healthcare costs. Combined with Social Security, $250,000 in savings could last well into retirement, particularly in the rural areas of the state.
States Where $250,000 and Social Security May Not Stretch as Far
1. California
California, particularly in cities like San Francisco, Los Angeles, and San Diego, has one of the highest costs of living in the country. The high cost of housing and healthcare can quickly deplete savings. In California, $250,000 in savings, combined with Social Security, may not last long, especially if living in a major metropolitan area.
2. New York
Similar to California, New York’s cost of living can quickly eat away at retirement savings, especially in cities like New York City and its surrounding areas. High rent, taxes, and healthcare costs make it difficult to stretch $250,000, even with Social Security. Rural areas of the state may offer a more affordable lifestyle.
3. Hawaii
Hawaii is another state where the cost of living is notoriously high. The cost of housing, food, and healthcare are some of the highest in the nation. For retirees, $250,000 in savings plus Social Security may not last as long in Hawaii, especially if living on one of the more expensive islands.
4. Massachusetts
In Massachusetts, particularly in areas like Boston, the high cost of living can be a significant challenge. Healthcare costs are also relatively high, making it difficult for retirees to stretch their savings. While Social Security benefits can help, the overall living expenses will quickly reduce the longevity of $250,000.
Middle Ground: States Where $250,000 and Social Security Provide a Balanced Retirement
1. Florida
Florida offers a more balanced cost of living, especially in rural or suburban areas. The absence of a state income tax is a major benefit for retirees, and the overall cost of healthcare and housing is moderate. In Florida, $250,000 combined with Social Security can provide a comfortable retirement, particularly outside of expensive cities like Miami.
2. Texas
Texas is known for its low property taxes and affordable housing, especially in smaller cities and rural areas. Healthcare is moderately priced, and there are no state income taxes, which benefits retirees looking to stretch their savings further. With $250,000 in savings, plus Social Security, retirees can enjoy a relatively comfortable lifestyle.
3. Tennessee
Tennessee’s cost of living is below the national average, with affordable housing and lower-than-average healthcare costs. Additionally, there is no state income tax, which helps preserve your savings. $250,000 in savings and Social Security should provide a stable and comfortable retirement in Tennessee.
Conclusion
How far $250,000 in savings, combined with Social Security, will take you depends largely on where you live. States with low costs of living, such as Mississippi and Arkansas, make it easier to stretch your savings over many years. However, in high-cost areas like California and New York, your retirement funds may not last as long. To make the most of your savings, it’s crucial to consider the cost of living and healthcare costs in your chosen state before making retirement decisions.
For more insights on managing retirement savings and Social Security, visit AARP.
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