These destinations that offer quality of life, but have a high cost of living
Where you retire can have as much impact on your finances as when. In the U.S., the cost of living varies dramatically from city to city, and those differences either stretch your retirement savings or strain them.
However, cost isn’t the only factor retirees consider. According to a 2024 survey of Americans nearing retirement age, local happiness narrowly surpassed affordability as their top priority in a retirement destination.
With all that in mind, let’s explore 10 American cities that are popular among retirees despite their high cost of living.
Key Takeaways
- Housing is the most significant expense in the average retiree’s budget and the leading factor in a retirement destination’s cost of living.
- Other determining factors in a city’s affordability include health care, transportation, food, and tax costs.
- Hidden expenses—like the distance from hospitals and major airports in your retirement destination—can also impact your comfort in retirement.
- Cities with strong appeal tend to have a higher cost of living, often driven by demand for their amenities or location.
- The ideal retirement destination should satisfy your practical requirements without sacrificing your ideal lifestyle.
Arlington, Virginia
Understanding the Costs
Arlington, VA, is just across the Potomac River from Washington, D.C., and its residents pay a premium for the privilege. The cost of day-to-day expenses like food and transportation is close to typical for the U.S., but Arlington’s elevated housing costs alone make it expensive.
The median home value in Arlington County is $864,000, more than double the national median of $416,900. Similarly, median monthly housing costs are roughly $2,414, compared to just $1,338 across the country.
What Makes the City So Expensive?
Arlington’s location near the nation’s capital drives strong demand for housing. Many residents commute to Washington, D.C., creating continued upward pressure on the local real estate market.
The city’s high standard of living also contributes to its popularity. Arlington boasts walkable neighborhoods, well-funded public services, and a concentration of white-collar jobs, reflected in the median household income of $140,160—far above the national median of $80,610.
Castle Rock, Colorado
Understanding the Costs
Castle Rock is just south of Denver and has become one of the region’s fastest-growing suburbs. Real estate prices—largely driven by demand for an outdoor lifestyle and access to the metro area—make it an increasingly expensive retirement destination.
The median home value in Castle Rock’s Douglas County is $674,000, while median monthly housing costs are $2,378. Both are more than one and a half times the respective national medians of $416,900 and $1,338 per month.
Tip
Getting around the area is pricier than in other parts of the country. Monthly transportation costs average $1,373, compared to $1,098 nationally.
What Makes the City So Expensive?
Castle Rock’s high cost of living is largely due to its proximity to Denver, Colorado’s capital and most populous city. It also appeals to outdoor enthusiasts due to its plentiful hiking trails, open spaces, and scenic views.
These factors have fueled rapid population growth—from 48,231 in 2010 to 81,415 in 2023—including an 11.3% jump between 2020 and 2023 alone. For comparison, the national growth rate has averaged just 0.8% per year since 2000. As more people move to the area, demand continues to climb, driving housing costs upward.
Delaware, Ohio
Understanding the Costs
Delaware—the city in Ohio, not the state—offers small-town charm, improving amenities, and easy access to Columbus, the state’s capital. These advantages helped make Delaware County the second fastest-growing county in Ohio between 2020 and 2023.
With more people moving in, housing demand has risen. Delaware County’s median home value may be close to the national figure, but monthly housing costs average $1,790—well above the U.S. median. Transportation is also costly, averaging $1,406 per month, over $300 more per month than the national average of $1,098.
What Makes the City So Expensive?
Delaware’s location just outside Columbus makes it attractive to those seeking a balance between suburban comfort and urban convenience.
The city has also seen continued development in its retail, dining, and recreational amenities. These have only added to its appeal and pushed costs higher, making Delaware an increasingly expensive place to retire.
Flagstaff, Arizona
Understanding the Costs
Flagstaff is another city where retirement doesn’t come cheap. Its combination of natural beauty, outdoor recreation, and university-town charm contributes to a surprisingly high cost of living.
Though monthly housing costs remain close to average in Flagstaff’s Coconino County, the median home value is around $503,400, well above the national figure of $416,900. Transportation is also expensive, with monthly costs averaging $1,378.
Note
Coconino County has a population of roughly 144,643 people and a median age of 32.
What Makes the City So Expensive?
Flagstaff’s strong tourism economy helps keep property demand high and makes it especially attractive to second-home buyers and short-term rental investors.
Not only does it offer plenty of outdoor excitement in its own right, but people also frequently visit on their way to see the Grand Canyon or explore the red rocks of Sedona.
Flagstaff’s proximity to Northern Arizona University adds additional housing pressure in the rental market. Students, faculty, and staff compete for housing near campus, tightening supply and contributing to higher prices.
Key West, Florida
Understanding the Costs
Key West is an island at the very tip of the Florida Keys, and its tropical lifestyle costs a pretty penny. The city’s limited land, booming tourism economy, and stiff competition for real estate make it one of the country’s most expensive places to retire.
The median home value in Key West’s Monroe County is $723,800, nearly twice the U.S. median of $416,900. Housing costs reflect that gap, averaging $1,800 per month, more than 30% higher than the national average. Median monthly food and transportation costs are also above average.
What Makes the City So Expensive?
Key West’s warm climate, waterfront views, and vibrant culture ensure its real estate is in high demand. The city is also a favorite for vacationers and second-home buyers, adding even more pressure to the local housing market.
On top of that, Key West’s housing supply is inherently constrained. Not only does the island have only 5.6 square miles of land area, but many properties are consistently occupied by short-term vacationers and tourists, rather than long-term residents.
Moyock, North Carolina
Understanding the Costs
Located just south of the Virginia border, Moyock primarily serves as a bedroom community for nearby military bases and job hubs in the Hampton Roads metro area, such as those in Chesapeake and Norfolk.
Despite home values falling below the national median, monthly housing costs around Moyock still average $1,466, higher than the national figure of $1,338. Transportation costs are even more expensive—not just relative to the national average, but also in total—costing roughly $1,523 per month compared to $1,098 across the U.S.
What Makes the City So Expensive?
Moyock’s proximity to military installations and regional employment centers keeps housing demand high in the area. Property values are relatively affordable, but competition among renters drives up monthly payments.
The county’s elevated household income of $91,548 also contributes to expenses. Households with higher earnings can support steeper prices, potentially propping up the cost of housing, goods, and services.
Warning
Limited access to health care may be a hidden cost. Currituck County, where Moyock is located, has only one hospital and 15 total medical establishments. Local retirees in need of services may face long travel times and low appointment availability.
New York City, New York
Understanding the Costs
It should come as no surprise that life is expensive in the City That Never Sleeps. The median home value in New York City is $1.1 million, more than two and a half times the national median. Meanwhile, monthly housing costs average $2,225, nearly $900 above the U.S. median of $1,338.
The average New Yorker also pays around $1,484 per month in taxes—more than the average American spends on housing. While the city’s walkability and public transit options help keep transportation costs down, monthly food costs average $1,027, almost 25% higher than the national average of $832.
Health care is another costly category. In 2023, the average annual premium for employer-sponsored single coverage was $9,173 in the state of New York, about 12% higher than the national average of $8,182.
Important
Housing, health care, transportation, and food are the top four expense categories in the average retiree’s budget, accounting for nearly 80% of spending.
What Makes the City So Expensive?
New York City’s appeal is legendary. As a global hub for finance, fashion, and entertainment, it draws people from every corner of the world. That constant influx, combined with the city’s notoriously limited space, keeps housing prices sky-high.
The city’s taxes are also uncommonly heavy due to New Yorkers paying federal, state, and city income taxes. When you add in some of the country’s highest property taxes and a relatively high sales tax rate, the result is one of the most burdensome tax loads in the U.S.
Finally, New York’s high wage floor—reflected in its median household income of $104,553—inflates expenses across the board.
Rockwall, Texas
Understanding the Costs
Only a short drive from Dallas, Rockwall offers lakeside living, a lively music scene, and a small-town atmosphere, all with convenient access to big-city amenities. That compelling combination continues to attract new residents and drive demand.
Despite having a median home value of just $386,000, monthly housing costs in Rockwall County average $2,054. That’s more than one and a half times the national average. Transportation expenses also add to the surprisingly high cost of living, with locals paying roughly $1,422 per month—over $300 more than the average American.
What Makes the City So Expensive?
Rockwall’s proximity to Dallas has made it an increasingly attractive choice for commuters, families, and retirees. As the Dallas-Fort Worth metro continues to grow, demand for housing and services in cities like Rockwall has surged.
Texas’s lack of a state income tax helps mitigate Rockwall’s inflated expenses, but can’t offset them completely. The town is still more affordable than Dallas proper for now, but its cost of living is likely to rise as more people are drawn to it.
San Diego, California
Understanding the Costs
With its year-round sunshine, easy access to the ocean, and laid-back culture, San Diego has long been one of the most desirable places to live in the U.S. Unsurprisingly, the cost of living in America’s Finest City reflects that.
The median home value is $791,600, nearly double the national median. Monthly housing costs are similarly steep, with a median of roughly $2,275. That’s more than $900 more than the national average—even higher than the costs in New York.
Health care spending makes up a smaller portion of the typical household budget in San Diego than the rest of the country, but other expenses are harder to avoid. Residents can expect to pay roughly $1,312 per month for transportation and $1,055 in taxes.
What Makes the City So Expensive?
San Diego’s idyllic climate and coastal location keep housing demand perpetually high, especially since buildable land is limited. The presence of multiple military bases and large universities only adds to that pressure, increasing the competition.
To top it all off, San Diego’s elevated wealth—evidenced by its median annual income of $102,285—further inflates the cost of products and services across the board.
Seattle, Washington
Understanding the Costs
Seattle’s booming tech sector has transformed the city into one of the most dynamic economic hubs in the U.S., but that success has a cost—namely, its cost of living.
With a median home value of $811,200, the typical Seattle property is now nearly twice as expensive as the national median. Monthly housing costs have followed suit, reaching a median of roughly $2,222 per month—putting them on par with the notoriously expensive New York.
What Makes the City So Expensive?
Seattle’s tech-fueled economy—anchored by giants like Amazon and Microsoft—has pumped high-paying jobs into the area and driven the median household income to $122,148. However, it’s also driven up housing prices, with the effect compounded by Seattle’s limited space and restrictive zoning laws.
Important
Health care costs are also on the rise. Insurance premiums in the state have jumped by double digits over the last decade, driven by a combination of population growth and increased demand for services.
Retirement Considerations
Finances are always critical when choosing a retirement destination, especially for those living on a fixed income. The cost of expenses like housing, health care, transportation, and taxes can significantly impact your long-term comfort and stability.
Because of this, cities like Key West and San Diego may seem out of reach for budget-conscious retirees. However, they’re in high demand for good reason, and there’s more to retirement than stretching your dollars. It’s also your time to enjoy the fruits of your life’s work.
Don’t let cost be the only lens through which you look at potential retirement places. Instead, consider quality of life as much as cost of living. The right destination should fit your budget and reflect your unique priorities—whether that’s staying close to family, enjoying outdoor adventures, or immersing yourself in a vibrant local culture.
The Bottom Line
Affordability is a key concern for retirees, and housing often plays the biggest role in determining overall cost of living. However, it’s not the only expense to consider when choosing a retirement destination. Health care, transportation, food, and taxes also significantly impact your long-term budget.
High-demand cities—whether prized for their climate, scenery, culture, or access to amenities—often have higher costs across the board, but that doesn’t mean they’re off limits. Where you retire should be just as much about supporting a lifestyle as it is about managing expenses. Don’t focus so much on day-to-day costs that you overlook less tangible ones, like isolation, inconvenience, or distance from what brings you joy.