By Thomas C. Corley
In my capacity as a CPA, CFP and tax strategist, I am often called upon to assist my clients in making the transition from worker to retiree.  The question I have been asked often during these engagements is: "Where are the cheapest places to retire in the U.S.?"

The underlying reason for this question is a fear that all of my retirement clients share, which is can they retire with the assets or income they have or expect to have in retirement?

For most, the answer is yes they can retire, just not in their current home state. Many states have become unaffordable for retirees. The reasons for this are varied:

    In certain states the cost of housing is simply too high.
    In other states property taxes have become unaffordable.
    And in still other states sales tax or income tax takes too much of a bite out of a retiree's retirement income.

Which states offer the best and most affordable retirement options? To answer that question, our team analyzed over 3,020 select cities, towns and communities across the United States for ten key factors and applied a proprietary scoring formula to each factor to determine which communities ranked highest as the best of the cheapest places to retire in the U.S. I compiled the results in a book, "The Top 100 Cheapest Places to Retire in the U.S. in 2012."

For each city, town or location we focused on the following ten key retirement factors and summarized the results:
1)    Lowest housing costs
2)    Lowest property tax
3)    Lowest sales tax
4)    Best climate
5)    Lowest crime rate
6)    Lowest income tax
7)    Closest to major or regional metropolitan areas
8)    Closest to hospitals
9)    Closest to airports
10)     Closest to beaches or coastlines

While low housing costs and low taxes were a paramount consideration in our research, they were not the only important factors which weighted heavily in our scoring. Climate, safe living conditions (crime rate), proximity to beaches, coastlines, cities, hospitals, and airports were other important factors we analyzed in determining the best of the cheapest. Proximity to a major city or regional metropolitan area allows retirees to engage in the cultural, entertainment and recreational activities many desire in retirement. Because retirees like to travel, and because many have children and grandchildren, the distance to a major airport is an important consideration to retirees and their extended families.

Deciding where to retire may very well be one of the most important decisions clients make as they approach retirement. Remaining in their current high-cost community may be too great a price to pay for those with limited retirement assets or limited retirement income. No retiree wants to be dependent upon family assistance, which typically means relying on their children, and no parent wants to disrupt the lives of their children. So making the right decision where to retire may be one of the most important decisions you make for you and your loved ones.

Following is a listing of the top ten cheapest places to retire in the U.S., based on our ranking:
1.   Gregory, Texas
2.   Holly Hill, Florida
3.   Long Beach, Mississippi
4.   Ingleside, Texas
5.   Pembroke Park, Florida
6.   Margate, Florida
7.   Largo, Florida
8.   La Porte, Texas
9.   Port St. Joe, Florida
10.  San Benito, Texas

Thomas C. Corley, CPA, CFP, M.S. Tax, CLTC, is president of Cerefice & Co., CPAs, and CEO of The Rich Habits Institute, a self-help organization based in Rahway, N.J., dedicated to training businesses and individuals to achieve unlimited success. Corely can be reached at [email protected]. For more information on  "The Top 100 Cheapest Places to Retire in the U.S. in 2012," click here

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