Things You Never Knew About Retiring in Alabama (2024)

Itswarm weather and rich culture make retiring in Alabama one of the best-kept secrets of retirement options. From delicious food to beautiful museums, there is no shortage of exciting attractions for retirees to enjoy.But some of the best parts about Alabama are the things you never knew. If you’re still not sure about where you want to live after you retire, take a look at some of the hidden gems of retiring in Alabama!

Things You Never Knew About Retiring in Alabama (1)

Small Town Beauty

When you think of Alabama, cities like Birmingham and Montgomery probably come to mind—but when you retire in Alabama, it’s not all about city life. Instead, you’ll get to enjoy the beauty of some of the state’s most charming towns. Decatur is just one example of these towns, and there are all kinds of historical landmarks and parks for you to explore. The Old Decatur Historic District features lovely Victorian-era homes that will transport you to another world. In fact, some of the houses pre-date the Civil War, which means they have a lot of history to share.

If you’re a nature-lover, Decatur is home to the Wheeler Wildlife Refuge, a 35,000-acre nature preserve that is perfect for a day of sightseeing and animal-watching. Established by President Franklin D. Roosevelt in 1938, the refuge was originally designed as a place for migratory birds to live and breed during the winter months—but it has since expanded into a home for hundreds of different fish, reptiles, and mammals.

You might like visiting the well-known cities and seeing all the popular historical landmarks in Alabama—but if you’re looking for some hidden gems, all you have to do is find a local small town on the map and see what it has to offer!

Things You Never Knew About Retiring in Alabama (2)

Uncommon Museums & Landmarks

When you host visitors—or even when you just want some entertainment for the weekend—it makes sense to go to a local art museum or theater. But Alabama is home to some of the most unique museums and attractions, which means you have plenty of activities to choose from to stay busy. For example, the U.S. Space & Rocket Center, located in Huntsville, takes you on an adventure through the history of space travel. It’s even home to the Space Camp Hall of Fame. With constantly changing exhibits, you’ll be able to enjoy something new every time you visit.

Another unique Alabama tourism site can be found in Fairhope, Alabama—one of the aforementioned small towns you can visit when you don’t want to be overwhelmed by city life. Tolstoy Park, the home of a man known as the “Hermit of Montrose,” is a small hut only 14 feet in diameter. In the middle of a parking lot surrounded by office buildings, you can find this hermit’s home—and see it for yourself.

Things You Never Knew About Retiring in Alabama (3)

Cost-of-Living Perks

Although many people think of Florida as the ideal state to retire in for tax benefits, Alabama offers some very similar advantages—especially since it’s a cheaper place to live. Although Alabama does have an income tax, it’s one of the lowest in the country, and Social Security benefits are completely exempt. Additionally, the cost of living in Alabama is 13% below the national average, which means the financial benefits of retiring to Alabama might even outweigh the financial benefits of retiring to Florida. Healthcare costs are lower in this state too, with retired couples paying an average of 4.4% less than the average retired American couple.

Finances are a crucial aspect of your retirement, and you want to live in a state where you can get the most for your money without having to sacrifice too much of your comfort. Thanks to the tax-friendly advantages you never knew about in Alabama, you can get all the joys of a Florida retirement—like golf, beaches, and beautiful weather—at a much lower cost.

Retiring in Alabama

As you do more research into retirement, we know the decision can be overwhelming. There are plenty of great attractions in Alabama—but even within the state, there are so many locations to consider.

If all the things you never knew about retiring in Alabama seem appealing to you, then we want to help you make this beautiful state your next home.Learn more about our communities located in Alabama, including one located on the pristine Gulf Shore!

Things You Never Knew About Retiring in Alabama (2024)

FAQs

Things You Never Knew About Retiring in Alabama? ›

Although many people think of Florida as the ideal state to retire in for tax benefits, Alabama offers some very similar advantages—especially since it's a cheaper place to live. Although Alabama does have an income tax, it's one of the lowest in the country, and Social Security benefits are completely exempt.

What is the number one mistake retirees make? ›

1) Not Changing Lifestyle After Retirement

Among the biggest mistakes retirees make is not adjusting their expenses to their new budget in retirement.

What are the pros and cons of retiring in Alabama? ›

Is Alabama a good place to retire? Alabama offers potential retirees a host of benefits, including a low cost of living, a mild climate, and plenty of opportunities for outdoor activities and cultural experiences. Still, the state's limited healthcare options should also be considered.

What taxes do retirees pay in Alabama? ›

Alabama exempts Social Security income in full from state income taxation. Regardless of how much money you make in retirement, you won't have to pay additional tax to Alabama on your benefits. Typically, retirees have to pay federal tax on any pension benefits they receive.

What is the average income for retirees in Alabama? ›

Download Table Data
StateAnnualMonthly
Montana$53,088$2,474
Iowa$52,899$2,034
New Mexico$52,563$2,576
Alabama$52,554$2,156
40 more rows

What is the biggest regret in retirement? ›

7 Retirement Mistakes You Will Regret
  • Not Diversifying Investments. ...
  • Not Seeking Professional Financial Help. ...
  • Not Preparing for Diminished Capacity. ...
  • Not 'Practicing' Retirement First. ...
  • Not Having a Purpose for Retirement. ...
  • Not Having Enough Non-Work Friends. ...
  • Not Communicating With Your Partner About Expectations.
Apr 13, 2024

What retirement mistakes to avoid? ›

Some common retirement mistakes are not creating a financial plan and not contributing to your 401(k) or another retirement plan. In addition, many people take their Social Security distributions too early, don't rebalance their portfolios to match risk tolerance, and spend beyond their means.

What city in Alabama is best for retirees? ›

A: According to Niche, Orange Beach is the best place to retire in Alabama in 2023. Q: Is retiring in Alabama a good idea? A: With an affordable cost of living and ideal tax benefits for retirees, making the decision to retire in Alabama is a great idea!

What age do you stop paying property taxes in Alabama? ›

If you are over 65 years of age, or permanent and totally disabled (regardless of age), or blind (regardless of age), you are exempt from the state portion of property tax. County taxes may still be due. Please contact your local taxing official to claim your homestead exemption.

What is not taxed in Alabama? ›

Income that is not reported to Alabama includes:

Retirement benefits. Unemployment. Life Insurance (proceeds received because of a person's death)

Who is exempt from paying property taxes in Alabama? ›

Homestead Types

Taxpayers age 65 and older with net taxable income of $12,000 or less on the combined (taxpayer and spouse) Federal Income Tax Return – exempt from all ad valorem taxes. Taxpayer is permanently and totally disabled – exempt from all ad valorem taxes. There is no income limitation.

At what age is Social Security no longer taxed? ›

Social Security income can be taxable no matter how old you are. It all depends on whether your total combined income exceeds a certain level set for your filing status. You may have heard that Social Security income is not taxed after age 70; this is false.

Is Alabama friendly to retirees? ›

For example, Alabama has no income taxes on retirement income from government pensions or 401(k) plans. This can be a great benefit for retirees who are working part-time in retirement or who have retired from a government job. Overall, Alabama is a very tax-friendly state for retirees.

What is a good monthly retirement income? ›

Average Monthly Retirement Income

According to data from the BLS, average 2022 incomes after taxes were as follows for older households: 65-74 years: $63,187 per year or $5,266 per month. 75 and older: $47,928 per year or $3,994 per month.

How much does the average retired person live on per month? ›

According to the Bureau of Labor Statistics (BLS), the average income of someone 65 and older in 2021 was $55,335, and the average expenses were $52,141, or $4,345 per month.

What is the average Social Security check? ›

Social Security offers a monthly benefit check to many kinds of recipients. As of December 2023, the average check is $1,767.03, according to the Social Security Administration – but that amount can differ drastically depending on the type of recipient. In fact, retirees typically make more than the overall average.

What is the most common mistake that retirees make when choosing where to live? ›

Living in the right place after you retire can make your money go a lot further. Donald Dutkowsky, professor emeritus of economics, says the most common mistake that retirees make when choosing where to live is not saving enough.

What are the 7 crucial mistakes of retirement planning? ›

7 common retirement planning mistakes — and how to avoid them
  • Expecting the government to look after you. ...
  • Counting on an inheritance. ...
  • Not having an estate plan. ...
  • Not accounting for healthcare costs. ...
  • Forgetting about inflation. ...
  • Paying more tax than you need to. ...
  • Not being realistic. ...
  • Embrace your future.

What is one of the biggest problems individuals can face in retirement? ›

“The main problem people face upon retirement is organizing their financial lives and finding new purpose,” says Robert Reilly, a member of the finance faculty at the Providence College School of Business and a financial advisor at PRW Wealth Management in Boston.

What is the hardest thing about retirement? ›

Reorientation: Often considered the hardest stage, this is when you're most likely to start re-evaluating your retirement lifestyle. It involves asking the hard questions, relearning what does and doesn't work for you, so you can get the most out of your retirement.

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