For many contemplating their golden years, the American Midwest stands out as a prime destination, offering a desirable combination of economic accessibility and a high quality of life. This region provides a distinct advantage for retirees looking to maximize their savings, with housing prices often considerably lower than those found in more densely populated coastal areas. Beyond just affordable homes, daily living expenses, including groceries, utilities, and transportation, are generally more manageable, allowing retirees to live comfortably and enjoy their leisure without constant financial worry. The appeal extends beyond monetary benefits, encompassing a rich tapestry of cultural experiences, diverse recreational activities, and tax policies designed to favor older adults, making the Midwest an attractive option for a fulfilling retirement.
Investopedia and Travel + Leisure collaborated to identify the top 50 retirement locations across the United States for 2025, with a particular focus on the Midwest. The selection process involved a thorough evaluation of various factors, including local income tax regulations, accessibility to major airports, availability of healthcare services, and the range of cultural attractions. While affordability was the primary criterion, the selected Midwestern cities were also chosen for their additional features that contribute to a more enjoyable and cost-effective retirement experience.
Gregory, South Dakota: Tranquility and Tax Benefits
Gregory, South Dakota, a small community of approximately 1,200 residents, offers an exceptionally budget-friendly lifestyle. Housing costs are remarkably low, with a median monthly expense of just $589, and median home values around $129,000 in Gregory County, making it possible for some retirees to purchase a home outright. Furthermore, South Dakota has no state income tax, allowing retirees to retain more of their Social Security benefits, 401(k) withdrawals, and pension income. This tranquil town provides a peaceful retreat, with the option for easy travel to larger cities via Eppley Airfield in Omaha, Nebraska, just a few hours away.
Toledo, Ohio: Culture and Urban Convenience
Toledo, Ohio, with a population of approximately 260,000, offers the advantages of a larger city while maintaining impressive affordability. The median home value in Toledo is about $155,200, and rental properties can be found for less than $900 per month. Lucas County, where Toledo is located, boasts median monthly housing costs of $953. Residents benefit from a vibrant cultural scene, including a popular zoo, a renowned art museum featuring European art and a significant glass collection, and proximity to other major cities like Akron, Cleveland, and Detroit. Ohio also offers tax benefits for retirees, as Social Security benefits are not taxed at the state level, and county taxes in Lucas County are very reasonable.
Poplar Bluff, Missouri: Nature and Relaxation
Poplar Bluff, Missouri, is a charming town nestled in the Ozark Mountains, ideal for outdoor enthusiasts. Its proximity to Mark Twain National Forest provides ample opportunities for hiking and camping, while Lake Wappapello offers excellent fishing and kayaking. The Ozark National Scenic Riverways, with its crystal-clear springs and caves, is also a short drive away. The median home value in Butler County, where Poplar Bluff is situated, is $138,800. Monthly transportation costs average $1,230, and food costs are around $536. Missouri does not tax Social Security benefits, though other retirement income may be subject to state taxes depending on income levels.
Corning, Iowa: Small-Town Charm with Financial Perks
Corning, Iowa, a small town with a population of 1,465 in Adams County, offers a very budget-friendly retirement. The median home value here is $116,900, with other monthly expenses also being gentle on the wallet. Median monthly food costs are around $589, and transportation costs average $1,455. Iowa is particularly appealing for retirees as it does not tax Social Security benefits, nor does it tax withdrawals from IRAs, 401(k) accounts, or pensions. Beyond its financial benefits, Corning is notable as the birthplace of Johnny Carson and provides access to natural beauty, including parks for hiking and camping, and Lake Icaria for fishing and boating.
Farmington, Missouri: Amenities and Activities
Farmington, Missouri, a city of approximately 19,000 residents, presents attractive figures for retirees. The median home value in St. Francois County is $155,100, significantly below the national average. Daily expenses are manageable, with monthly food costs around $577 and transportation at $1,239. Missouri offers tax-free Social Security benefits for retirees, though IRA, 401(k), and pension withdrawals may be taxed based on income. Farmington provides numerous amenities, including the Farmington Civic Center with activities and sports facilities, and it borders the Mark Twain National Forest for outdoor recreation. Its proximity to the St. Louis arts scene and Missouri's wine country adds to its appeal.
Youngstown, Ohio: Cultural Hub with Affordability
Youngstown, Ohio, a Rust Belt city located in the foothills of the Appalachian Mountains, is recognized for its retiree-friendly environment. Housing is affordable, with a median home value of approximately $141,000 in Mahoning County and monthly housing costs averaging $792. Other expenses are also reasonable, with food costing around $669 per month and transportation about $1,181. Youngstown offers a rich cultural experience, featuring the free Butler Institute of American Art, the DeYor Performing Arts Center, and various events hosted by Youngstown State University. The city also boasts beautiful outdoor spaces like Mill Creek Park, and Ohio exempts Social Security income from state taxes.
Bay City, Michigan: Waterfront Living and Historic Charm
Bay City, Michigan, situated along the Saginaw Bay, offers a charming small-city atmosphere with a wealth of activities. Its median home value in Bay County is around $135,000, lower than both state and national averages. A two-person household typically spends about $588 per month on food, with taxes at $580 and transportation costs around $1,193. The historic downtown area, with its Victorian architecture, local shops, and restaurants, provides a vibrant setting. Cultural venues like the historic State Theatre and the Bay City Players offer regular entertainment, ensuring a lively retirement lifestyle.
Mason City, Iowa: Arts, Architecture, and Low Costs
Mason City, Iowa, a medium-sized city located between Minneapolis/St. Paul and Des Moines, boasts a surprisingly rich cultural scene. It celebrates its connection to composer Meredith Willson at Music Man Square and offers free admission to the Charles H. MacNider Art Museum. Architecture enthusiasts can admire the Historic Park Inn Hotel, the world's last remaining Frank Lloyd Wright-designed hotel. The North Iowa Area Community College also hosts a diverse range of performing arts events. The cost of living is a significant draw, with a median home value of $154,100 in Cerro Gordo County. Monthly expenses for a couple average $866 for housing, $650 for groceries, and $1,258 for transportation. Iowa's tax policies are favorable, with no state taxes on Social Security benefits or withdrawals from IRAs, 401(k) accounts, or pensions.
Saginaw, Michigan: Active Community and Recreation
Saginaw, Michigan, a medium-sized city of about 43,000 residents along the Saginaw River, is part of the Greater Tri-Cities region. It offers a vibrant social scene for retirees, with various senior centers organizing regular activities. Recreational options include the Saginaw Valley Rail Trail for walking and biking, as well as several golf courses. Summer events at Ojibway Island and the Friday Night Live concert series foster community engagement. The median home value in Saginaw County is $139,400. A two-person household can expect to spend $866 per month on housing, $1,211 on transportation, $588 on groceries, and $591 on taxes.
Muncie, Indiana: College Town Perks and Affordability
Muncie, Indiana, located in east-central Indiana, about 50 miles northeast of Indianapolis, benefits from being a college town. Ball State University contributes to a lively cultural environment with numerous events and entertainment options. The David Owsley Museum of Art on campus offers free admission, and the Muncie Civic Theatre stages regular productions. The Emens Auditorium at Ball State hosts touring shows, concerts, and speakers. The cost of living in Muncie is attractive, with median home values around $127,600 in Delaware County. Monthly expenses include $579 for food and $1,180 for transportation, with average housing costs at $821 per month. While Indiana does not tax Social Security benefits, withdrawals from IRAs, 401(k) accounts, or pensions are subject to state taxation.
The American Midwest offers retirees an exceptional combination of reasonable housing prices and a lower overall cost of living compared to many other U.S. regions. This financial flexibility allows for a more comfortable and enjoyable retirement. All the cities highlighted in this analysis boast median home prices under $200,000, ensuring that retirees' money stretches further across essential expenses like groceries and entertainment. Many Midwestern states also implement tax policies favorable to seniors, further enhancing financial well-being. Beyond the economic advantages, the region is home to world-class medical centers and robust regional hospitals, providing excellent healthcare access. Furthermore, Midwestern cities, whether large or small, offer a diverse array of arts, recreational activities, and abundant opportunities to explore the great outdoors, catering to a wide range of interests and ensuring a rich, engaging post-career life.