PHOENIX — A new study breaks down the annual income needed to retire comfortably in Arizona — and which cities in the state are easiest on retirees' wallets.
Retiring comfortably in Arizona requires at least $68,642 per year on top of Social Security, according to a study by financial site MoneyLion.
MoneyLion defines a comfortable retirement as spending less than half of your income on necessities — shelter, groceries, and utilities. The figures represent what retirees would need beyond their Social Security benefits.
Over a 20-year retirement, that annual figure compounds to $1,373,000.
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For workers planning ahead, the math is straightforward: a 20-year-old needs to set aside about $2,500 per month into a 401(k) or IRA. Wait until 30 to start, and that number jumps to closer to $3,300 per month. The earlier you start, the less it costs you.
How Arizona compares to other states
Hawaii is the most expensive state to retire in — and it isn't close. Retirees there need $157,000 per year, more than double what's needed in Arizona.
Within the region, Arizona is one of the more affordable options. California retirees need to clear $122,000 per year. Washington comes in at $95,000, while Colorado and Utah both top $80,000.
The most affordable states are in the South and Midwest. Mississippi, Louisiana, Arkansas and Oklahoma all require under $40,000 per year. West Virginia is the cheapest state to retire in, and costs increase as you move northeast.
Where in Arizona retirees fare best
Location within Arizona also makes a significant difference.
Among the five largest Arizona cities where seniors are least cost-burdened, Tempe tops the list, with Casa Grande close behind. In both cities, housing accounts for less than 20% of a senior household's income.
Glendale ranks third, followed by Flagstaff and Casa Adobes, just north of Tucson.
Casa Adobes also has the highest share of seniors on the list, suggesting retirees are already finding it an attractive destination.
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