Top Locations with the Highest and Lowest Social Security Coverage for Your Costs
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In a recent analysis by Kiplinger and LendingTree, the top 10 U.S. metro areas where Social Security benefits cover more than 30% of retirees' spending were identified.
- McAllen, Texas, stands out as a metro area where Social Security benefits cover more than a third (34.6%) of retirement spending.
- Buffalo, New York, El Paso, Texas, Syracuse, New York, Scranton, Pennsylvania, Wichita, Kansas, Augusta, Georgia, Tucson, Arizona, Little Rock, Arkansas, and Tulsa, Oklahoma, are among the top 10 where Social Security benefits cover more of retirement spending, although specific percentages were not provided.
- Tulsa, Oklahoma, is another city where Social Security benefits cover a bit over 32% of retirees' spending, and it also has a cost of living that is 16.4% below the national average.
- The top 10 list also includes cities like McAllen, Buffalo, El Paso, Syracuse, Scranton, Wichita, Augusta, Tucson, Little Rock, and Tulsa, where Social Security benefits cover over 32% of retirees' spending.
On the other hand, eight out of the ten places where Social Security covers the lowest percentage of retirees' spending are in California. San Francisco is the metro area where Social Security covers the lowest percentage (24.28%) of retirees' spending, followed by San Jose (25.42%), Oxnard (25.28%), and Los Angeles (24.85%). Miami, Florida, is also in the list, ranking tenth with a low percentage (26.93%) of retirees' spending covered by Social Security.
These findings indicate that Social Security benefits go further in metro areas with lower cost of living and favorable tax policies. By contrast, high-cost metro areas such as in California or cities like Washington, D.C., and Miami have Social Security covering only about 24-26% of retirement expenses.
Other metro areas where Social Security benefits cover a significant portion of retirement spending include Milwaukee, Wisconsin (31.6%), Indianapolis, Indiana (31.5%), Las Vegas, Nevada (31.4%), Detroit, Michigan (31.3%), Des Moines, Iowa (31.1%), Louisville, Kentucky (30.9%), and Cleveland, Ohio (30.8%).
This research emphasizes the critical impact of local living costs on how far Social Security benefits stretch for retirees, making it essential for retirees to consider the cost of living when planning their retirement destinations.
[References] [1] LendingTree. (2021). Where Social Security Goes Further: The 10 Cities Where Benefits Cover the Most of Retirement Expenses. Retrieved from https://www.lendingtree.com/home/research/where-social-security-goes-further-the-10-cities-where-benefits-cover-the-most-of-retirement-expenses/ [2] Kiplinger. (2021). The 10 Cities Where Social Security Goes the Furthest. Retrieved from https://www.kiplinger.com/slideshow/retirement/T052-S001-the-10-cities-where-social-security-goes-the-furthest/index.html [3] Social Security Administration. (2021). Average Benefit Amounts. Retrieved from https://www.ssa.gov/oact/quickcalc/benefits.html [4] AARP. (2021). The Best and Worst Cities for Retirement. Retrieved from https://www.aarp.org/money/work/info-2021/best-cities-for-retirement-2021.html
In light of these findings, it's clear that personal finance becomes significantly stretched in high-cost metro areas like San Francisco, San Jose, Oxnard, and Los Angeles in California, where Social Security covers only about 24-26% of retirement expenses. On the flip side, cities with lower costs of living and favorable tax policies, such as McAllen, Texas, Tulsa, Oklahoma, and Milwaukee, Wisconsin, offer more value for personal-finance-minded retirees, with Social Security benefits covering over 30% of retirement spending in these locations.
