Social Security Goes Further in These 10 States

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10 States Where Social Security Covers the Most (financebuzz.com)

Where Your Social Security Stretches Furthest: A Look at the Top 10 States for Retirees

For many Americans, Social Security forms the bedrock of their retirement income. But just how much mileage you get from those hard-earned benefits can drastically depend on your zip code. With the cost of living, from housing to healthcare and transportation, fluctuating significantly across the nation, some states offer retirees a much more financially comfortable existence.

A recent analysis by FinanceBuzz delved into average annual expenses for those aged 65 and older, comparing them against the average Social Security payment in each state. The findings reveal which states allow Social Security benefits to cover the largest percentage of those expenses, offering a roadmap for maximizing your senior benefits.

Here’s a look at the top 10 states where your Social Security check goes the extra mile:

10. Tennessee

Social Security covers: 42.0% of annual expenses

Retirees in the Volunteer State can expect average annual expenses of $55,827, while typical Social Security benefits hover around $23,458. Lower housing and utility costs are key contributors to benefits stretching further here. Plus, Tennessee’s lack of state income tax on Social Security benefits adds to its appeal for retirees relying heavily on their monthly checks.

9. Michigan

Social Security covers: 42.2% of annual expenses

Michigan seniors face average yearly expenses exceeding $58,500, balanced by relatively robust average Social Security payments of approximately $24,700. While some Midwestern states boast lower costs, Michigan’s above-average benefits help cover a substantial portion of core expenses, particularly for those living outside bustling metropolitan areas.

8. Missouri

Social Security covers: 42.2% of annual expenses

In Missouri, older adults spend roughly $55,000 annually, with average Social Security payments at $23,235. The state’s affordable housing and everyday costs, especially in smaller cities and rural communities, play a significant role in allowing Social Security income to cover more than two-fifths of typical retirement spending.

7. Alabama

Social Security covers: 42.3% of annual expenses

Alabama retirees benefit from average annual expenses around $54,343, paired with Social Security payments of $22,962. Below-average costs for housing, transportation, and healthcare contribute to this impressive coverage rate, making Social Security a stronger financial foundation for those on fixed incomes.

6. Nebraska

Social Security covers: 42.5% of annual expenses

Nebraska offers a desirable combination of strong average Social Security payments and moderate living costs. With average expenses at $56,630 and Social Security payments averaging $24,053, housing remains affordable across much of the state, and daily expenses are manageable, allowing benefits to cover a larger portion of annual costs than in many other regions.

5. Iowa

Social Security covers: 42.8% of annual expenses

With average annual expenses of $55,827 and Social Security payments of $23,867, Iowa solidly earns its spot on this list. Affordable housing and stable costs for necessities help benefits go further, making the Hawkeye State appealing for retirees seeking predictable expenses and a greater reliance on their Social Security income.

4. Minnesota

Social Security covers: 43.0% of annual expenses

Minnesota retirees may face higher annual expenses-$58,238-but they also receive some of the highest average Social Security payments at $25,065. These stronger benefit levels help to offset the higher costs, meaning Social Security still covers a larger share of expenses here than in most other states nationwide.

3. Indiana

Social Security covers: 43.5% of annual expenses

Indiana combines average yearly expenses of approximately $56,012 with Social Security payments of $24,388. Lower housing costs and an overall moderate cost of living are key factors behind the strong coverage rate, allowing Social Security to reliably cover a significant portion of everyday expenses for many retirees.

2. Oklahoma

Social Security covers: 44.1% of annual expenses

Oklahoma stands out with average expenses of $52,179, among the lowest in the top 10, coupled with Social Security payments of $23,020. The state’s overall affordability, particularly for housing and transportation, enables benefits to stretch significantly further, making Social Security a more powerful income source for retirees.

1. Kansas

Social Security covers: 44.8% of annual expenses

Taking the top spot, Kansas boasts average annual expenses of $54,961 and Social Security payments around $24,603. The lower living costs relative to benefit levels are the driving force behind this leading ranking. While Social Security still doesn’t cover every single expense, it stretches farther in Kansas than anywhere else in the country.

The Bottom Line for Retirement Planning

When envisioning your golden years, it’s crucial to consider the full financial landscape. As this data illustrates, your choice of residence can profoundly impact how far your Social Security benefits will take you. In these top states, benefits cover roughly 42% to nearly 45% of annual expenses for adults 65 and older-a notable advantage over the national average, largely due to lower everyday costs relative to benefit levels.

However, even in the most affordable states, Social Security alone typically doesn’t cover all retirement expenses. This highlights the critical importance for both current and future retirees to pair their benefits with other income sources. Furthermore, it underscores the need to factor in the overall cost of living, not just taxes or weather, when making that pivotal decision about where to retire.