A silhouette of a retired couple holding hands on a dock built on Alabama’s Gulf Coast

Affordability and Hospitality: Here’s Why You Should Consider Retiring in Alabama

Alabama Retirement

by Matt Lyons Posted on November 30, 2023
Home to camellias, cotton, Crimson Tide and Tigers, Alabama is one of the best places you can retire not only in the Southern U.S.. It’s a supremely senior-friendly state with warm weather year-round, Gulf Coast towns to settle down, and golf courses for days. Affordability is another major perk of retiring in Alabama, with a low cost of living and plenty of tax benefits for retirees to enjoy.

What Are the Benefits of Retiring in Alabama?

Is Alabama a good place to retire? We think so. It has a little bit for everyone,  with nearly 100 beaches that stretch along the Gulf Coast, plenty of natural spaces, and room to spread out, you won’t spend too long searching for an ideal spot. The state has warm weather year round, however, you’ll want to be aware of the hot, muggy summers. 

Q: Is Alabama a good state to retire?
With a cost of living almost 16 percent below the national average, along with a plethora of retirement communities to settle down in, Alabama is a great place for retirees to live out their golden years.

Picturesque river in Alabama

Retiring in Alabama — Pros and Cons

Alabama has some of the best beaches in the South, and offers an affordable, yet bountiful lifestyle for retirees to stay active and entertained. While the perks of retiring in Alabama outweigh some of the negatives, it’s always important to consider the drawbacks of moving somewhere new. Check out the major pros and cons of retiring in Alabama.

Pro: Low Cost of Living

With a cost of living index of 84.1, the total cost of living in Alabama is nearly 16 percent lower than the national average. 

Con: Public Transportation Is Limited

Like other southern states, public transit options are limited outside of major cities. In Alabama, you’ll be hard-pressed to find a bus stop outside of cities like Birmingham or Mobile.  Train stops are scarce as well, with three stops for the entire state in Anniston, Birmingham, and Tuscaloosa.

Pro: Warm Weather Makes It Easy to Enjoy Alabama’s Outdoor Beauty

Retired adventurers are lucky to have access to Alabama’s outdoor recreation, from the mountain ranges, to the Talladega National Forest, and a variety of hiking trails in places like Gulf State Park. Because winters are mild and the Spring and Summer months are warm, you have plenty of time to get outdoors year round!

Con: Healthcare Access Is a Concern for Most of the Population

The unfortunate news for retirees considering Alabama is that it ranks quite low when it comes to healthcare access, and proper access to care is one of the biggest health concerns across the entire state. 

Pro: Alabamians Are Passionate About College Football, to Say the Least

This state’s love for college football runs deep — a characteristic you’ve probably noticed throughout the SEC.  You can catch the famous Iron Bowl  — the biggest of the season for both teams — between the University of Alabama and Auburn University. The rivalry between these schools isn’t just left on the field, it’s a lifestyle. “War Eagle” and “Roll Tide” function as greetings and goodbyes just as well as they do cheers. Just make sure you know where the other person’s allegiances lie beforehand.

Con: Sometimes the Summer Heat Is Too Much

While one of the main advantages of retiring in Alabama is the warm weather, sometimes the temperatures in the summertime get way too high for comfort. Temperatures will stay in the 90s during the summer time, and the heat index can even trail into the hundreds.

A couple planning their Alabama retirement

How Much Money Do You Need to Retire in Alabama?

Alabama is considered tax-friendly towards retirees, as social security income and public/private pension income are not taxed. However, the main drawback to these tax perks is that any withdrawals from retirement accounts are fully taxed at a marginal state tax rate of 5 percent. Alabama also has one of the lowest property tax rates in the country, with homeowners only paying around $675 a year in property taxes. 

Q: How much money do you need to retire comfortably in Alabama?
According to a report by CNBC, the annual cost for a comfortable retirement is almost $56,800, plus a recommended 20 percent “comfort buffer” is just over $11,350. Remember, though, that is just an estimate. How much you need will depend on how many years your retirement ultimately is, along with your lifestyle and health needs. 

How Does It Stack Up Against Other Southern States?

When it comes to two of Alabama’s neighbors — Louisiana and Mississippi — things can look either cheaper or more expensive, but there’s more to analyze here. Louisiana’s cost of living index of 89.9 is higher than Alabama’s 84.1, and it also comes with a higher average combined state and local sales tax rate of 9.55 percent (Alabama’s is 9.25). 

Mississippi, on the other hand, comes with a lower cost of living and no state income tax, meaning that Social Security income, withdrawals from retirement accounts, and even pension income is all free from taxation. Its cost of living index also sits at just 78.7 — over 21 percent below the national average.

The Best Places To Retire in Alabama 

With warm weather, outdoor recreation, lots of fun local events and festivals, it’s hard to settle on just one place when looking for the best place to retire in Alabama. 

Q: Where in Alabama should I retire?
To give you a better idea on the best locations for retirees in particular, take a look at the best places to retire in Alabama in 2024. 

1. Alexandria, AL

Situated in Calhoun County, the agricultural community of Alexandria is the second best place to retire in Alabama, according to Niche. Although farming is the main focus of the local economy, retirees living in Alexandria can stay active and engage in a variety of outdoor recreational activities like boating, fishing, and hunting at places like Cheaha State Park Resort. 

Hiking is also quite popular among residents living in Alexandria, and many retirees enjoy taking walks at local spots like the Chief Ladiga Trail and the Civitan Park Trail.

2. Fairhope, AL

A fun fact about this next special coastal town is that it was first established in 1894 by a group of tax reformers who thought the region would have a “fair hope” of success. (Get it?) Today, the town is a beautiful place for retirees to settle down. With gorgeous waterfront vistas, a vibrant downtown with lots of shops and restaurants, and a variety of fun events, there’s plenty do throughout the year. 

The Arts and Crafts Festival is one the biggest annual events in Fairhope, with hundreds of artists and craftsmen showing and selling their wares throughout a three day event every March.

Robinson Island in Alabama

3. Gulf Shores, AL

Gulf Shores is an upscale retirement community and resort community that's located on a barrier island near Mobile Bay. It features a variety of activities and attractions, including plenty of white sand beaches, Gulf State Park, and close proximity to a couple golf courses on the Robert Trent Jones Golf Trail. The city’s economy is largely based on real estate and tourism, so you can expect to find some of the best beachfront condos, waterfront homes, and more in the Gulf Shores area. 

The Alabama Gulf Coast Zoo is situated close to Gulf Shores. It’s a great place to spend the day with younger grandkids and explore up close animal encounters, along with a variety of other educational opportunities. The Gulf Shores Museum is another interesting attraction for history buffs to check out.

In nearby Orange County, retirees can check out the new Active Adults Center

4. Foley, AL

Just a short drive away from Gulf Shores is the town of Foley, the seventh best place to retire in the state, according to Niche. Foley is home to museums, a great dining scene, a historic district, and many festivals and events throughout the year that engage all of the local residents. The Gumbo and Alabama Slammer Festival, along with the CAFFM Harvest Festival are both great events to bring the grandkids along to! 

Foley has some of the best retirement communities you can find in Alabama, including The Grove, which is a private community with resort-like amenities including a clubhouse, pool, and a two-mile walking and biking trail.  

5. Cedar Bluff, AL

Located on the shore of the beautiful Weiss Lake, Cedar Bluff is one of the best small towns in Alabama to retire in, full of beautiful lakefront homes with boat docks and piers. Weiss Lake holds a variety of fishing tournaments during the year at the local, state, and national levels. The lake has over 400 miles of shoreline, surrounded by beaches, natural beauty, and mountains. 

Cedar Bluff is situated in Cherokee County, and the town is within two hours  of major hubs, including Atlanta, Birmingham, and Chattanooga. If you’re wanting to get more involved in the community, check out the Cherokee Rose Garden Club.

6. Daphne, AL

On the eastern shore of Mobile Bay is where you can find the inviting town of Daphne, a charming destination with its own unique southern style.You’ll only be an hour’s drive from the Gulf Coast beaches, but you might not want to leave. Daphne comes with its own share of  waterfront areas ideal for fishing and boating. Mayday Park features a small swimming area, while Bayfront Park features a pavilion that overlooks the bay and is home to performances by the Baldwin Pops and City Rhythm Band.

The area’s annual Jubilee Festival of Arts is well-loved and great to let the grandkids explore. Whether it’s fresh seafood, face paintings, or local vendors you want to check out, this event has it all. 

Best Places to Retire in Alabama on a Budget 

  • Rainbow City, AL: The southern hospitality, diverse culture and arts scene, and beautiful nature trails are some of the highlights that make Rainbow City a great place to live for retirees. In addition, it's home to the Silver Lake Golf Course, which features 36 holes spread through forests and dramatic elevation changes. The cost of living in Rainbow City is 79.4, much lower than the national average index of 100 and also lower than the state average of 84.1.
  • Muscle Shoals, AL: Muscle Shoals is full of small-city experiences, including historic district exploration, popular restaurants to try, and quaint boutiques to shop at. The town is also home to Ivy Green, the museum and former home of Helen Keller. With a cost of living of 79.3, Muscle Shoals provides entertainment for retirees at an affordable rate.
  • Cullman, AL: Cullman is one of the fastest growing communities in Alabama, and it’s easy to see why due to the natural beauty, outdoor recreation opportunities, and social activities for seniors. The 21,000-acre Smith Lake offers many marinas, boat ramps, and other areas for the best outdoor experience. Cullman’s cost of living index is 81.3, making it an affordable community for retired outdoor enthusiasts.

A man loading a box labeled “bedroom” into a PODS container

Retiring in Alabama: Making the Move

When you’re ready to retire in Alabama, turn to the experts at PODS to help you get moving and settle in. They can provide a portable storage container that will be delivered to your doorstep, where it will be taken to your new home once you are ready. Need help with the heavy lifting? No problem, PODS can connect you with local packing and loading help. One month of storage will also be included in the move, so you can easily unload your things without feeling rushed.

Editor’s note: For ease of reading, monthly rental prices were rounded to the nearest $25 and home values were rounded to the nearest $100.

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