Millions of Americans retire every year, and more and more are leaving the workforce early due to the COVID-19 pandemic. According to the Federal Reserve Bank of New York’s latest labor market survey, only about 50.1% of people expect to work beyond 62 years old, the lowest ratio since the New York Fed started tracking these statistics.
Alabama and Georgia are highly rated retirement locations. They have lighter tax burdens and ways to enjoy your time outside. The better retirement spot depends on your preferences in communities and activities, financial condition, and proximity to family and other care and support systems.
Are you staying where you are or moving somewhere sunnier, somewhere with longer sweater weather, a bustling city, or a quiet small town? Or, are you moving for financial reasons? Read on to know what sets these two states apart.
Which Is a Better Retirement Location — Alabama or Georgia?
Alabama and Georgia are both tax-friendly states with a lot of Southern charm, nature, and beaches, and a mix of city and country life for a relatively low cost compared to the rest of the country. They both have low taxes, which might make either state attractive for retirement.
But there are also some cons to living in either state, including issues on quality of living and their infamous humidity. Here is a quick overview of the pros and cons of retiring in Alabama and Georgia. We’ll go over them in detail later on in the article.
While Alabama has a humid climate, there are several reasons why retirees flock to this area. There are several reasons why you might consider moving to Alabama, but there are also several reasons to stay away from this state.
Let’s look at them now.
- Relatively cheaper cost of living.
- Low tax burden.
- Lots of beautiful natural scenery.
- Low ranking in quality of living surveys.
- Humid climate with long severe weather season.
- Under-performing public K-12 schools.
Georgia might outperform Alabama in school performance, and they have heavy traffic most of the time, but there are many other reasons why you might consider this state instead.
Let’s talk about these reasons now.
- Light tax burden.
- Strong economy.
- Poor healthcare quality.
- Hot, humid summers.
- Heavy traffic
Retiring in Alabama
As of 2018, more than a third of the population of the Heart of Dixie was over 50 years old, slightly above the national average. According to the US Census Bureau, in 2019, 17.3% of Alabama’s population was aged 65 and older.
This means that there will be a lot more people your age to meet up with and create a strong support system of friends.
Taxation and Cost of Living
Alabama is one of the friendliest states for retirees in terms of taxation.
In Alabama, federal and state pensions, as well as social security benefits, are not subject to state income tax. Property taxes are also very low compared to the rest of the nation. Homeowners aged 65 and older are exempt if they are disabled or earn below a certain bracket.
The cost of living in Alabama is also cheaper than the national average.
In fact, the state is one of the most affordable places to live in the US, alongside places like West Virginia, Arkansas, and Mississippi. That means you can enjoy this Southern state’s natural attractions, beaches, rich culture, and thriving small-town life for much less than pretty much elsewhere.
According to Attractions of America, some beautiful small towns in Alabama include:
- Fort Payne
And, speaking of natural beauty, Alabama is home to about 60 miles (96.5 km) of the Gulf Coast. In other words, it has an abundance of sugar-white beaches and clear waters for you to enjoy.
Alabama’s climate is humid subtropical, which means sweltering summers, mild winters, and a lot of rain and thunderstorms.
Quality of Life
Unfortunately, Alabama ranks very low in nearly all quality of living indicators with:
- High violent crime incidence rates
- Low-income levels
- High poverty and obesity rates
In a study by NiceRX, a medication access company, Alabama emerged as one of the unhappiest states based on factors such as household income, life expectancy, homicides, and poverty rate. It ranked 47th out of 50 states.
In contrast, Hawaii was considered the happiest state.
Additionally, Alabama is one of the lowest-ranking states in terms of public education, according to US News.
Retiring in Georgia
Persons over 65 years old represented 14.3% of Georgia’s population in 2019. But the US Census Bureau estimates that more than 1 in 5 Georgia residents will be 60 or older by 2030, increasing demand for professionals to care for an aging population.
Tax Perks, Strong Economy
Georgia is often considered one of the best places to retire in the US due to its favorable tax rates and low cost of living and homeownership. Like Alabama, Georgia does not tax social security income, and it only partially takes a cut from withdrawals from retirement accounts and pensions.
One year of a comfortable retirement in Georgia will cost you a little over $57,000 in 2021, less than half of what you’d need to kick your feet up in the most expensive state of Hawaii.
The Peach State also has one of the best-performing economies in the country, ranking 10th in economic performance in the Rich States, Poor States: ALEC-Laffer State Economic Competitiveness Index in 2021. Its economic outlook is also positive, placing 14th out of 50 states in the same index.
You’d also get firsthand experience of Southern culture in Georgia, with its excellent food, including Georgia peaches, and an overall laidback lifestyle. However, you’d have to get through its humid summers before enjoying its mild winters.
You can’t miss Georgia’s stunning beaches, mountain towns, and natural attractions as well, like the Chattahoochee River, Providence Canyon, and Ooh La La Lavender Farm, to name a few.
Quality of Life
However, recent surveys may change your perception about retiring in Georgia. MoneyWise said Georgia is one of the worst places to retire in 2021, with most of the blame resting on its healthcare quality.
In separate lists, WalletHub and MedicareGuide ranked the Peach State last among all US states in terms of health indicators, including:
- Access to care.
- Medicine prices.
- Life expectancy.
In the category of health outcomes, which covers data on infant mortality and maternal mortality, the state placed 47th.
MedicareGuide looked specifically into senior health care, particularly:
- Medical costs
- Mortality rates for heart disease, cancer, and stroke.
- Access to geriatricians, nurses, and home health aides.
Another thing Georgia, specifically Atlanta, is known for is heavy traffic. In 2019, people in Atlanta lost 82 hours to traffic congestion, according to the Global Traffic Scorecard. Atlanta ranked 10th in the list of US cities with the worst traffic, behind fellow big cities Boston, Chicago, and Philadelphia.
As in anywhere, there are many pros and cons of retiring in Alabama or Georgia.
Alabama has many great options if you’re interested in small-town living while comfortably enjoying your retirement benefits. Georgia’s economy is headed in a good direction, but its performance in health care might make you think twice about settling down there.
Though they’re not without areas of concern, these two states remain top retirement locations in the US. Other than the factors mentioned above, you’d still have to consider matters like housing arrangements, your proximity to your loved ones, and the ease of moving around.
- Pew Research Center: The pace of Boomer retirements has accelerated in the past year
- Federal Reserve Bank of New York: Labor Market Survey Shows Improvement in Expectations; Average Reservation Wage Increases Compared to a Year Ago
- Annuity.org: Best States to Retire
- Retirepedia: 25 Pros And Cons Of Living In Alabama
- Top Retirements: Alabama Best Places to Retire – A Guide
- Acts Retirement-Life Communities: Things You Never Knew About Retiring in Alabama
- New Home Source: The 10 Best Places to Retire in Alabama in 2021
- Bankrate: Why Georgia is Bankrate’s best state for retirement in 2021
- Acts Retirement-Life Communities: Georgia Retirement Taxes
- Retirepedia: 17 Pros and Cons of Living in Georgia
- The Informed Senior: Should You Retire in Georgia or Florida? Let’s Compare!
- Senior Living: Alabama Senior Living Statistics & Facts
- Tax Foundation: Facts & Figures 2021
- Best Places: Alabama
- NiceRx: Happy Nations
- US News & World Report: Best States for Education
- Rich States, Poor States: Georgia
- GO Banking Rates: What a Comfortable Retirement Will Cost You in Each State
- Only In Your State: 15 Stunning Natural Attractions In Georgia That Are Great For Day Trips
- MoneyWise: The Worst States for Retirement in 2021
- Georgia Health News: Two rankings on health put Georgia at the bottom of states
- US News & World Report: The 10 Most Congested Cities in the U.S.
- Georgia Department of Human Services: Demand for professionals in the aging field increasing
- United States Census Bureau: QuickFacts Alabama; Georgia
- Attractions of America: 10 Most Beautiful Small Towns in Alabama