5 Southern States Where $1 Million in Retirement Savings Lasts the Longest
One million dollars has long been thought of as the ideal retirement nest egg, but the truth is that in many states, that won’t be enough to last through retirement for most people. The cost of living is on the rise and many people are now living multiple decades in retirement, so that $1 million may run out quicker than you think.
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To determine how long $1 million in retirement savings would last in every state, GOBankingRates calculated the average annual expenditures for retirees. In the most expensive state — Hawaii — a $1 million nest egg would last less than 10 years. On the flip side, in the states where $1 million lasts the longest, $1 million will last over 19 years — and many of them happen to be in the South.
Here’s a look at the Southern states where $1 million in retirement savings last the longest.
1. West Virginia
Annual groceries cost: $4,701
Annual housing cost: $7,284
Annual utilities cost: $4,067
Annual transportation cost: $4,528
Annual healthcare cost: $7,163
Total annual expenditures: $49,261
How long $1 million will last in savings: 20 years, 3 months, 19 days
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2. Mississippi
Annual groceries cost: $4,644
Annual housing cost: $8,488
Annual utilities cost: $3,685
Annual transportation cost: $4,216
Annual healthcare cost: $7,427
Total annual expenditures: $50,128
How long $1 million will last in savings: 19 years, 11 months, 12 days
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3. Oklahoma
Annual groceries cost: $4,519
Annual housing cost: $8,313
Annual utilities cost: $4,003
Annual transportation cost: $4,651
Annual healthcare cost: $6,982
Total annual expenditures: $50,186
How long $1 million will last in savings: 19 years, 11 months, 5 days
4. Alabama
Annual groceries cost: $4,596
Annual housing cost: $8,243
Annual utilities cost: $4,312
Annual transportation cost: $4,404
Annual healthcare cost: $6,469
Total annual expenditures: $50,995
How long $1 million will last in savings: 19 years, 7 months, 11 days
5. Arkansas
Annual groceries cost: $4,548
Annual housing cost: $8,582
Annual utilities cost: $3,876
Annual transportation cost: $4,444
Annual healthcare cost: $6,469
Total annual expenditures: $51,169
How long $1 million will last in savings: 19 years, 6 months, 15 days
Methodology: In order to find how long $1,000,000 will last across the country, GOBankingRates first found (1) the national average annual expenditures for people 65 and older, sourced from the Bureau of Labor Statistics’ 2022 Consumer Expenditure Survey data. Then, GOBankingRates created (2) state-level annual expenditure estimates by multiplying the national figure by each state’s overall cost of living index score for the 3Q 2023 from the Missouri Economic Research and Information Center. Finally, GOBankingRates found (3) how many years $1,000,000 will last in each state by dividing $1,000,000 by each state’s average annual expenditures estimate. All 50 states and the District of Columbia were then ranked with No. 1 being the state where $1,000,000 will last the longest and No. 51 being the state where it will run out most quickly. GOBankingRates provided supplemental information on the average annual cost of groceries, housing, utilities, transportation and healthcare for people 65 and older in each state by again using MERIC’s cost of living indices for each category to factor out national estimates from the CES. All data was collected on and up to date as of April 23, 2024.
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This article originally appeared on GOBankingRates.com: 5 Southern States Where $1 Million in Retirement Savings Lasts the Longest