This 2025 Retirement Readiness Index ranks all 50 states using publicly available data on key indicators, including seniors' 401(k) balances, retirement income, and homeownership. We also factored in each state's life expectancy and affordability to provide a data-backed look at how well they support retirement security and long-term planning for their financial future.
National Retirement Trends & Economic Shifts
Retirement in America is changing. Rising living costs, longer life expectancy, and shifts in retirement age are affecting how people approach their retirement goals. While some savers have built sizable retirement savings through 401(k)s or annuities with careful asset allocation, others struggle to stay on track due to inflation, debt, or limited access to an employer contribution or pension plan.
Many older Americans continue working past age 65, often in part-time roles, to supplement Social Security benefits or cover healthcare costs. Fewer retirees rely solely on a pension benefit, with more depending on a mix of retirement savings, Social Security, and individual income sources. These trends vary widely by state, making it important to examine how each region supports a secure retirement.
How We Ranked the Best & Worst States for Retirement
To evaluate how ready residents are for retirement, we scored states across five categories tied to financial stability, retirement needs, and standard of living. Each included data from credible sources and was weighted based on its impact on retirement security. All scores were normalized on a scale from 0 to 100 to allow for fair comparisons.
Here's what we measured:
- Retirement funds and benefits: We analyzed average 401(k) balances to assess savings levels and pension participation to reflect reliable retirement benefits. These are important pieces of a well-diversified financial future.
- Earnings and employment: This included senior employment rates and median annual income for retirees, which reflect financial flexibility and additional income sources after leaving the workforce.
- Homeownership rate: Owning a home can reduce reliance on withdrawals from retirement savings and provide housing security. We looked at how many Americans age 65 and older own versus rent.
- Quality of life: Life expectancy offers insight into long-term wellness and can indicate how well a state supports healthy aging.
- Cost of living index: States with a lower cost of living allow retirees to stretch their savings accounts further. Affordability remains a core component of retirement readiness.
Ranking States on Retirement Preparedness
While financial strategy is often personal, location plays a larger role than many realize. State-level factors like income opportunities, healthcare access, and housing stability can significantly influence how well residents can meet their retirement goals.
New Jersey (94.3) and Connecticut (93.4) ranked first and second overall in retirement readiness. Both states stood out for their high retirement savings, strong senior income, and high life expectancy. Maryland (92.3), Virginia (92.2), and Vermont (90.6) followed closely, each offering a solid foundation of retirement benefits, homeownership, and earnings potential.
In contrast, West Virginia came in last with a score of 79.3. Other low-ranking states included Arkansas (79.5), Mississippi (79.5), and Tennessee (79.7). These states generally reported lower savings balances, fewer job options for seniors, and lower life expectancies, all of which can impact long-term financial security.
Despite low rankings in homeownership (46th) and cost of living (44th), New Jersey ranked first overall in retirement readiness. This was mainly driven by the nation's highest retirement savings (1st), strong employment opportunities for seniors (2nd), and a top life expectancy (4th). Connecticut followed in second place overall, with high savings (2nd), top life expectancy (3rd), and strong senior earnings (4th), though it ranked low in homeownership among retirees (44th).
West Virginia landed at the bottom of the list, held back by weaker retirement savings (44th), and limited income potential (50th).
Where Retirees Thrive (& Struggle)
Now that we've ranked the best and worst states for overall retirement readiness, it's time to break it down by category. Looking at these factors individually provides a clearer picture of where retirees have the strongest financial foundation and where challenges remain.
Retirement Savings and Senior Employment Vary Widely
Retirement savings vary dramatically by state. Connecticut, New Jersey, New Hampshire, and Alaska lead, with average nest eggs exceeding $500,000. In contrast, retirees in Utah, North Dakota, and Mississippi had less than $350,000 saved on average.
Employment rates for adults 65 and older also differ. About 1 in 4 seniors were still in the workforce in South Dakota (28%), Vermont (25.8%) and Massachusetts (24.2%), compared to less than 15% in West Virginia and Arkansas.
Cost of Living Isn't the Whole Story
West Virginia presents quite a mixed picture. It has the highest senior homeownership rate (85.6%) and the lowest cost of living. But with a median retirement income of just $55,300 and the nation's lowest senior employment rate (13.7%), many retirees may still face challenges. Low costs help, but they don't guarantee financial security without sufficient income sources.
Hawaii offers a different contrast. Seniors there enjoy the country's highest median retirement income ($96,500) and the longest life expectancy (79.9 years). Still, its high cost of living can make affording to retire there difficult, even for high earners.
Housing affordability is another key issue. Senior homeownership rates are especially low in New York (65.5%) and California (73.1%), where steep housing costs often force retirees to rent, adding strain to fixed incomes.
Pension Coverage Highlights Regional Gaps
New Jersey (55%) and Washington (53%) had the highest pension participation rates. Alaska (19%) and Ohio (32%) had the lowest, leaving many retirees in these states more reliant on personal savings and Social Security.
All these differences show that no single factor defines retirement security. A well-rounded retirement plan, including savings, steady income, and affordable living, is essential for financial confidence in retirement.
Retirement Readiness Resources: Expert Tools & Guides for Planning Your Future
Accessing accurate, up-to-date resources can help make retirement planning more manageable. These official tools and guides offer free support across topics like saving, Social Security, tax strategies, and long-term budgeting.
Explore these trusted sites to take the next step in building your retirement plan:
- Consumer Financial Protection Bureau (CFPB) — Offers a Retirement Planning Guide covering pensions, Social Security, and managing income later in life.
- Social Security Administration (SSA) — Use the my Social Security portal to estimate benefits, review earnings history, and manage claims.
- Internal Revenue Service (IRS) — The Retirement Plans page details tax benefits, contribution limits, and required minimum distributions.
- State-Sponsored Retirement Programs — Many states offer retirement savings plans for workers without employer-sponsored options. Search your state government's website or visit NAST.org.
- Western & Southern Retirement Toolkit — Check out our retirement planning services for personalized strategies, educational resources, and tools like our retirement calculator .
How To Use This Index To Plan for a Secure Retirement
Retirement readiness is more than just having large retirement savings. It requires the right mix of financial stability, income opportunities, housing security, and quality of life. As this index shows, where you live can play a big role in how prepared you are for retirement.
Policymakers, financial professionals, and individuals can use these findings to take meaningful steps toward improving retirement readiness. Whether it's increasing access to retirement savings options, expanding investment options, or supporting financial education, stakeholders at every level can help build a stronger foundation for retirement security.
Whether you're years from retiring or already planning your next chapter, using data like this can help you make informed decisions. The more you understand about your state and your options — especially with guidance from financial advisors — the better equipped you'll be to retire with confidence.
Methodology
Overview
The Retirement Readiness Meta-Ranking evaluates all 50 U.S. states based on key financial, economic, and lifestyle factors that influence retirees' ability to maintain a secure and comfortable retirement. By analyzing multiple publicly available datasets, this ranking highlights which states help offer the strongest financial security, economic opportunities, affordability, and quality of life for retirees.
Data Sources & Factors Considered
The ranking is built using five core categories, each weighted to reflect its impact on retirement preparedness. These categories were chosen based on research into what contributes to a financially stable and fulfilling retirement.
Scoring Categories & Weighting
- Retirement Funds & Benefits (30 Points Total)
- 401(k) Balance (20 Points): The average savings held in retirement accounts, reflecting financial preparedness.
- Source: Personal Capital
- Pension Participation Rate (10 Points): The percentage of seniors receiving pensions, offering insight into income stability beyond personal savings.
- Source: Bureau of Labor Statistics
- Note: South Dakota's senior employment rate (65+) is based on the most recent CPS/BLS estimates published in the 2023 South Dakota Workforce Report, as the figure was not included in the national BLS release.
- 401(k) Balance (20 Points): The average savings held in retirement accounts, reflecting financial preparedness.
- Earnings & Employment (25 Points Total)
- Senior Employment Rate (65+) (15 Points): The percentage of seniors still working, reflecting job opportunities and financial flexibility.
- Source: Bureau of Labor Statistics
- Senior Median Income (10 Points): The median annual income for individuals aged 65 and older, capturing the overall earning potential of retirees.
- Source: U.S. Census Bureau
- Senior Employment Rate (65+) (15 Points): The percentage of seniors still working, reflecting job opportunities and financial flexibility.
- Homeownership Rate (20 Points Total)
- The percentage of seniors who own their homes, indicating housing stability and reduced financial strain from rent or mortgages.
- Source: U.S. Census Bureau
- The percentage of seniors who own their homes, indicating housing stability and reduced financial strain from rent or mortgages.
- Life Expectancy (Years) (15 Points Total)
- The average life expectancy in each state, treated as a positive factor since it reflects better healthcare and living conditions.
- Cost of Living Index (10 Points Total, Reversed Score)
- A lower cost of living is ranked positively, as it allows retirees to stretch their savings further.
- Source: World Population Review
- A lower cost of living is ranked positively, as it allows retirees to stretch their savings further.
How the Scoring System Works
Each state receives a score for each factor based on its relative position to the highest and lowest values in the dataset. We normalize all factors to a 0-100 scale, ensuring that each metric is comparable across different units (e.g., dollars, percentages, and years).
- Higher values are better for most factors (e.g., 401(k) balances, homeownership, life expectancy).
- For Cost of Living, lower values receive a higher score since affordability is beneficial for retirees.
A state's final Retirement Readiness Score is the sum of its weighted scores across all five categories, with a maximum possible score of 100 points.
This methodology balances financial stability (savings, pensions, income), economic opportunity (employment), affordability (cost of living, housing), and quality of life (life expectancy). By structuring the ranking this way, we ensure a holistic view of retirement readiness, rather than focusing solely on savings or affordability.
About Western & Southern Financial Group
Founded in Cincinnati in 1888 as The Western and Southern Life Insurance Company, Western & Southern Financial Group, Inc., a Fortune 500® company at No. 284, is the parent company of a group of diversified financial services businesses. Its assets owned ($80 billion) and managed ($42 billion) totaled $122 billion as of Sept. 30, 2024.1 Western & Southern is one of the strongest life insurance groups in the world. Its seven life insurance subsidiaries (The Western and Southern Life Insurance Company, Western-Southern Life Assurance Company, Columbus Life Insurance Company, Gerber Life Insurance Company,2 Integrity Life Insurance Company, The Lafayette Life Insurance Company, and National Integrity Life Insurance Company) maintain very strong financial ratings. Other member companies include Eagle Realty Group, LLC; Fabric by Gerber Life; Fort Washington Investment Advisors, Inc.;3 Gerber Life Agency;4 IFS Financial Services, Inc.; Touchstone Advisors, Inc.;3 Touchstone Securities, Inc.;5 W&S Brokerage Services, Inc.;3,5 and W&S Financial Group Distributors, Inc.6 Western & Southern is a title sponsor of several major community events every year. From 2002 to 2023, it served as title sponsor of Cincinnati's longtime professional tennis tournament — now named the Cincinnati Open — an ATP Masters 1000 and WTA 1000 event and one of the world's largest tournaments. The company continues to serve as a major sponsor of the event.
1 The financial information presented here is preliminary and unaudited.
2 Gerber Life is a registered trademark. Used under license from Société des Produits Nestlé S.A. and Gerber Products Company.
3 A registered investment advisor.
4 In the State of California, Gerber Life Agency, LLC is known as and does business as Gerber Life Insurance Agency, LLC.
5 A registered broker-dealer and member FINRA / SIPC.
6 W&S Financial Group Distributors, Inc. (doing business as W&S Financial Insurance Services in CA).
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