North Carolina
5 Reasons You Need at Least $681K (Plus Social Security) To Retire in North Carolina
How much do you need to have saved for retirement? If you live in North Carolina, you will need at least $681,000 for a 20-year-long retirement. However, if you need a longer retirement or don’t have Social Security benefits, that number can be much higher.
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Here’s what you need to know about the costs of retirement in North Carolina and how they compare to the rest of the U.S.
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How Much Money Do Retirees Need In North Carolina?
According to GoBankingRate’s Bureau of Labor Statistics data analysis, the cost of living for an adult 65 years and older in North Carolina is $55,620.92. The average annual Social Security benefit for retirees is $21,566.76, meaning the average North Carolina retiree will need an additional $34,054.16 of annual income.
Here’s how much you will need to have saved for retirement based on those numbers.
If you’re planning a 20-year-long retirement, you’d need around $681,000. To enjoy a 25 or 30-year retirement, you’ll need $851,354 or $1,022,647, respectively.
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Of course, if you invest some of that money into safe assets, you can stretch your money a bit further. Before making any investment decisions, consult with a qualified financial advisor who gives you personalized advice and helps you make the most of your savings safely.
Here are five reasons you need this much money to retire in North Carolina.
1. Groceries
In North Carolina, the annual cost of groceries is approximately $4,710.65, about 1.8% less than the national average of $4,797. While this means you can get slightly more bang for your buck, food costs vary based on your dietary needs and preferences.
Keeping an organized budget in this category can help retirees maintain a balanced diet without overspending. Take advantage of discounts and local markets to get the most out of your budget.
2. Housing Costs
Housing in North Carolina costs about 7.7% less than the national average, with an annual expense of $10,791.72 compared to $11,692. This means you can save on one of the biggest retirement expenses.
You may also save even more by moving to a more cost-effective community or downsizing to a smaller property that meets your needs without stretching your budget.
3. Utilities
Utility expenses in North Carolina average $3,914.06 annually, about 7.6% below the national average of $4,236. Utilities are a monthly expense that can fluctuate with usage and seasonal changes. You might pay more in winter when you need to heat your home and keep the lights on for longer.
You can save on utilities by setting the thermostat a few degrees higher in the summer when you’re out or asleep and by knocking down the thermostat temperature a bit at night during the winter.
4. Transportation
North Carolina’s transportation costs are 8% lower than the national average, costing you about $4,547.56 yearly. While owning a car provides freedom, using it also means continuous expenses on gas and maintenance.
To save money, you can try carpooling and using public transit. If you live in a walkable area, walking to and from some of your errands can help you save money and stay healthy at the same time.
5. Healthcare
Your healthcare expenses in North Carolina will be around $8,060.26 annually — nearly 6.9% higher than the national average of $7,540. Healthcare often becomes a more significant expense as you age, so it’s wise to explore all your insurance options thoroughly.
Look into supplemental plans that cover what Medicare does not, and always shop around for services to ensure you are getting quality care at the best price.
Should You Move Out of North Carolina To Retire?
Is it worth it for retirees to move out of North Carolina? While some states in the U.S. are cheaper, the cost of living in North Carolina is already 3.8% less expensive than the national average of $57,818 per year.
If you would prefer to live in a different state and own your house, it might make financial sense to try and sell it and downsize to a smaller house or apartment.
Everyone’s finances are different, so it can be a good idea to consult with a financial advisor about your specific situation.
Methodology: In order to find out exactly how much you need to retire in your state, GOBankingRates found the annual cost of expenditures for a retired person in each state by multiplying the 65-year and older expenditures from the Bureau of Labor Statistics 2022 Consumer Expenditure Survey by the cost of living index for each state from the Missouri Economic Research and Information Center’s Q3 2023 cost of living series. To find how much money a retired person would need to save, we divided each state’s annual expenditures, minus the annual Social Security income as sourced from the Social Security Administration’s Monthly Statistical Snapshot, March 2022, by 0.0333%, 0.04%, and 0.05% assuming 20, 25, and 30 years of retirement respectively. All data was collected and is current as of January 8, 2024.
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This article originally appeared on GOBankingRates.com: 5 Reasons You Need at Least $681K (Plus Social Security) To Retire in North Carolina