Where $1.5M Can Buy Nearly 40 Years of Retirement in the U.S.
- Iowa is the best state for early retirement, where $1.56M can provide nearly four decades of financial freedom after 40.
- New Hampshire, Utah, and Hawaii are the most comfortable states for retirement, showing the highest quality of life.
- South Dakota offers one of the simplest tax systems for retirees, with Social Security and pensions completely tax-free.
Around 13% of Americans have already retired before age 55, with more people now planning to leave the workforce even earlier. A recent study by investment advisory firm Neil Jesani Wealth Management analyzed all 50 states to identify where Americans can retire young and enjoy the longest financial freedom.
The research evaluated states using four social and financial indicators: money needed to retire at age 40 (calculated by combining healthcare and living expenses over expected lifespan), years of carefree living post-retirement, tax friendliness for retirees, and overall quality of life. States were ranked using a Retirement Safety Score from 1 to 99, with higher scores indicating better conditions for retiring at a younger age.
Here’s a look at the top 10 states to retire young in America:
| State | Money You Need to Have to Retire After 40 (USD) | Number of Years to Live Carefree after 40 | Quality of Life Index | Retirement Safety Score |
| Iowa | 1,560,554 | 37.7 | 55.5 | 99 |
| New Hampshire | 2,334,217 | 38.5 | 65.6 | 93 |
| Wyoming | 1,708,665 | 35 | 55.9 | 89 |
| South Dakota | 1,823,522 | 36.6 | 49.2 | 87 |
| Nevada | 1,750,367 | 35.1 | 45.2 | 81 |
| North Dakota | 1,762,199 | 37.6 | 50.4 | 79 |
| Arizona | 1,803,200 | 35 | 54.3 | 76 |
| Hawaii | 2,627,575 | 39.9 | 60.1 | 75 |
| Utah | 1,830,735 | 38.2 | 62.7 | 74 |
| Alaska | 2,074,002 | 34.5 | 51.2 | 73 |
You can access the complete research findings here.
Iowa ranks as the best state in the US for people who want to retire early. Retirees in Iowa will need $1.56M to quit working at 40, which, based on the state’s 78-year life expectancy and local cost of living, provides financial security for 38 years. Iowa also stands out with a high quality of life and a simple tax system.
New Hampshire takes second position, offering the longest carefree retirement period of nearly 39 years. Despite requiring sizable savings for early retirement, New Hampshire compensates for this with the best quality of life in the top 10. The state also maintains tax-friendly policies for retirees, taking no portion from their Social Security and pensions.
Wyoming comes in third place, with an estimated $1.71M needed to retire at age 40. With living costs about $6K below the national average, this savings pool could be enough for 35 years of living. Wyoming also does not impose taxes on pensions.
In fourth place is South Dakota, where it takes $1.82M to step away from work permanently. This amount can support about 37 years of financial freedom in South Dakota. Early retirees here will also benefit from tax-free pensions and one of the least complex taxation rules.
Ranking fifth, Nevada demands around $1.75M in savings to sustain 35 years of retirement. With a straightforward tax structure and no taxes on pensions or Social Security, Nevada also makes it easier to keep retirement savings under control. The state stands out for low healthcare costs too ($8,348 per year).
Next is North Dakota, where retirement savings of $1.76M would be enough to provide for about 38 years of life. The state sets relatively low income tax rates, capping them at around 2.5% and allowing for exemptions in certain cases.
Arizona takes seventh place, with $1.8M in savings needed for 35 years of retirement, similar to South Dakota. Arizona also sets similar low taxes for retirement, at 2.5%. Retirees can expect a higher quality of life than in North Dakota or Nevada, with an index of 54.3.
In eighth place is Hawaii, with $2.6M needed for retirement. It is the highest saved amount in the top 10, but this money would be spent on the longest retirement in the top 10, almost 40 years. Hawaii also has one of the highest quality of life, getting an index of 60.1.
Utah holds ninth place, requiring $1.8M for a safe retirement. Similar to New Hampshire, the retirees could enjoy over 38 years without work, and the quality of life is the second-highest on the list, with an index of 62.7.
Alaska rounds up the top 10, with early retirees needing about $2.07M to fund 35 years of financial independence. The state’s remote location is offset by notable tax advantages: zero taxes on Social Security or pensions.
“The FIRE movement (Financial Independence, Retire Early) continues to grow,” says Neil Jesani, CEO of Neil Jesani Wealth Management. “Retiring decades before 65 was once considered impossible, but today a significant portion of our youth is actively pursuing this goal by prioritizing savings and investments. And as the economy expands, these goals actually no longer seem that impossible, especially in low-cost states. As we’ve seen, there are places in the US where financial independence can be achieved with under $1.5M. The best part is their affordability doesn’t come at the expense of quality of life, many of these budget-friendly locations actually offer excellent living standards.”