Locations with Maximum and Minimum Social Security Coverage of Living Costs
For many retirees, the amount of Social Security benefits they receive can significantly impact their financial well-being. A recent analysis by LendingTree reveals a wide variation in the percentage of retirees' spending that is covered by Social Security across different U.S. metro areas.
In the top 10 metro areas where Social Security benefits cover more than 30% of retirees' spending, eight are outside of California. McAllen, Texas, leads the pack with 34.6% of retirees' spending covered, followed by Buffalo, New York (33.12%) and El Paso, Texas (32.85%). Other cities in this group include Wichita, Kansas (rank 6, 32.64%), Syracuse, New York (rank 4, 32.84%), Tulsa, Oklahoma (rank 10, 32.27%), and Little Rock, Arkansas (rank 9, 32.28%). Tucson, Arizona is also on the list with 32.29% coverage.
California, however, holds five of the ten spots on the list of the 10 Most Expensive Cities to Live in the US, with San Francisco (24.28%), San Jose (25.42%), San Diego (25.74%), Los Angeles (24.85%), and Riverside (26.60%) having Social Security benefits covering less than 30% of retirees' spending.
By comparison, cities like McAllen, Wichita, and Tulsa have costs of living that are below the national average, making Social Security benefits stretch further in retirement. Tulsa, for instance, has a cost of living that is 16.4% below the national average.
The variation in Social Security coverage is primarily due to differences in local cost of living, housing costs, and tax policies. For example, California, along with Alaska and Washington, D.C., are the five most expensive states for retirees, with California holding five spots on the list of the 10 Most Expensive Cities to Live in the US.
In contrast, cities like Buffalo, Buffalo, and Tulsa offer a more favourable environment for retirees, with lower costs of living and higher Social Security coverage. This could make them attractive destinations for those looking to retire and maximise their Social Security benefits.
Other metros with Social Security coverage just above 30% include Milwaukee (31.6%), Indianapolis (31.5%), Las Vegas (31.4%), Detroit (31.3%), Des Moines, Iowa (31.1%), Louisville, Kentucky (30.9%), and Cleveland (30.8%).
In conclusion, the amount of Social Security benefits retirees receive can vary greatly depending on where they choose to live. By carefully considering factors such as cost of living, housing costs, and tax policies, retirees can make informed decisions about where to settle and ensure their Social Security benefits provide the best possible support in retirement.
In metro areas where Social Security benefits cover a higher percentage of retirees' spending, such as McAllen, Texas, Buffalo, New York, and El Paso, Texas, the cost of living is generally lower than the national average, allowing retirees to stretch their Social Security benefits further. In contrast, cities in California, like San Francisco, San Jose, San Diego, Los Angeles, and Riverside, have costs of living that are higher than the national average, resulting in Social Security benefits covering less than 30% of retirees' spending. Therefore, retirees should consider factors like cost of living, housing costs, and tax policies when deciding where to settle to maximize their Social Security benefits.
