Cold and no money? Here are 4 hot states that won’t tax your retirement income at all – no matter how old you are or how much money you have.

Cold and no money?  Here are 4 hot states that won't tax your retirement income at all - no matter how old you are or how much money you have.

Cold and no money? Here are 4 hot states that won’t tax your retirement income at all – no matter how old you are or how much money you have.

As the United States moves into the cold depths of winter, retreating somewhere warm probably sounds good right now.

But for many people on the cusp of retirement, it’s not just cold climates that can overshadow your golden years. There are also taxes.

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If you’re looking to retire to a place that’s not only warm, but keeps a thirsty government away from your hard-earned post-career assets, you have options. Some U.S. states even have the golden combination of temperate climates, no income tax, no retirement tax, and no tax on retirement benefits—regardless of your age or wealth.

However, it’s important to remember that state taxation is part of a larger revenue puzzle: you can’t avoid federal taxes or, in most cases, property or local taxes that support schools, infrastructure, and first responders.

However, here is an example of where your money will go the furthest while you stay the warmest.

Florida

Let’s get the obvious choice out of the way: The Sunshine State is very hospitable to retirees and their money. The state is known to have no state income tax, which means you will not pay tax on your pension.

Assuming you can survive the state’s real estate expenses and the occasional hurricane, your 401(k) and IRA payments will go further since Florida does not tax payments on these plans. And social security? There are no taxes on this either.

Nevada

Retiring to the Silver State is a safe bet, as Nevada is another state that has no income tax, which, like Florida, means no taxes on pensions, pension payments, or Social Security.

Nevada is home to many of the nation’s top cities for retirees, and the suburbs outside of Las Vegas offer an enticing combination of warmer winter temperatures and year-round access to casinos and other entertainment.

Read more: The best investment apps of 2023 for once-in-a-generation opportunities (even if you’re new)

Texas

Although recent winter conditions have proven challenging even for Texas, overall, the Lone Star State can be expected to be warm. Tax breaks will warm your heart too.

Texas does not tax state income. It also does not tax Social Security, retirement income, or pension plan payments. These factors, combined with an overall lower cost of living and comparatively lower real estate values, make Texas an attractive place to land.

But the public money lost due to these tax breaks has to come from somewhere, which explains why the state has some of the highest property tax rates in the country.

Tennessee

If that’s good enough for Dolly Parton, why not you too?

There is no income tax in this state, which means that Tennessee residents do not pay taxes on their pensions, 401(k)s, IRAs, or Social Security benefits. The state also boasts a low cost of living, including low property taxes.

And if you’re looking for company in your golden years, Tennessee is also home to a number of retirement communities, which it promotes through the Tennessee Department of Tourism Development.

Bonus: Hawaii

How about another idyllic landing spot, Hawaii?

Unfortunately, Hawaii doesn’t quite fit the bill: while Social Security income is not taxed in the state, private pensions and retirement benefits are taxed.

Of course, there’s a good chance that if you’re even considering Hawaii – with its high cost of living and skyrocketing real estate valuations – you probably figured you could survive those fees.

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This article provides information only and should not be construed as advice. It is provided without any warranty.

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