Tuesday, October 10, 2017

Where to retire in the USA

Some weeks ago I published a post on recommended countries for Where to retire. Not everyone wants to leave their homeland, however, and so for many of our readers it may therefore be relevant to consider which states in the USA might be recommended as most desirable for retirees.

In this regard, the Bankrate web site has recently considered Where are the best and worst states to retire? They collated data (from various sources) for each of the 50 states for the following eight characteristics:
  • Cost of living
  • Healthcare quality
  • Crime rate
  • Cultural and social vitality
  • Weather
  • Taxes (income and sales taxes)
  • Senior citizens' overall well-being
  • The prevalence of other seniors
For 2017, the states were then ranked from 1–50 for each of these characteristics separately. These rankings were then weighted according to a survey of the reported relative importance of each of these characteristics — they are listed above in the order of decreasing importance. From the weighted data, Bankrate produced an overall ranking of the states for their desirability to retirees, which you can check out on their web site.

However, this ranking is overly simplistic, because it suggests that there is only one main dimension to retirement desirability, from best to worst. Clearly, retirement is multi-dimensional — there is no reason to expect the eight characteristics to be highly correlated. Therefore a network analysis would be handy to explore which characteristics differ between the states.

As for my previous analysis, I have calculated the Manhattan distance pairwise between the states; and I am displaying this in the figure using a NeighborNet network. States that have similar retirement characteristics are near each other in the network; and the further apart they are in the network then the more different are their characteristics.

In the network graph I have highlighted Bankrate's top 10 ranked states in green and their bottom 10 states in red. Note that they do not cluster neatly in the network, emphasizing the importance of considering the different characteristics, rather than just averaging them into a single ranking.

So, the network does not represent a single trend (from best to worst) — this would produce a long thin graph. Instead, the network scatters the states broadly, indicating that they have multiple relationships with each other — the eight retirement characteristics are not highly correlated. Indeed, the network is L-shaped, suggesting two main trends. The main part of the L has the north-eastern and west-coast states at one end and the mid-western and western states at the other, while the short part of the L separates out the south-eastern and south-western states. There are several obvious exceptions to these broad patterns (eg. Kentucky).

You can see that the north-eastern states tend to cluster together as being among the most desirable retirement locations (in Bankrate's ranking), and that the southern states tend to cluster together as being among the least desirable.

California is interesting because it ranks in the top two for Weather and Culture, but near the bottom for everything else. Hawaii ranks highly on Well-being and Culture but very poorly on Taxes, Crime rate, and Cost of living (where it is dead last). Florida, naturally, ranks first for Prevalence of seniors, but it is ranked mediocre to poor on everything else (including its hurricane-prone weather). New York is ranked first for Culture but mediocre to poor for everything else (and is ranked last for Taxes).

Alaska is ranked best for Taxes, Mississippi is best for Cost of living, Vermont is top for Crime rate (being low!), and Maine is best for Health care. Of these, only the latter state scores well for other characteristics, being second for Crime Rate and Prevalence of seniors. This puts it in the overall top three states, along with New Hampshire and Colorado.

New Hampshire gets the top spot by ranking well on everything except Cost of living and Weather — it is close to last for the latter characteristic!

So, the bottom line is that there is no state that particularly stands out as most suitable for retirees — in terms of desirable characteristics, what you win on the swings you lose on the roundabouts. Hardly surprising, really.

If you are interested in retiring to a particular city, then this recent web page may also be of relevance to you: Top 25 cities where you can live large on less than $70k.

Neither this nor the previous analysis (for countries) has addressed the issue of politics. Political voting is not randomly distributed, and some people prefer to live surrounded by voters similar to themselves. If this is you, then Wikipedia has a map indicating which states you might prefer.

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