New York is worst state for retirement, Bankrate says

New York ranked last as a place to

New York ranked last as a place to retire because it has the highest tax rates in the country and the fourth highest cost of living, Bankrate said. Additional blows were low marks for satisfaction levels of residents and health care quality. (Credit: iStock )

New York is the worst state for retirement because of its high taxes and cost of living, according to a new study from Bankrate.com, a personal finance website.

Bankrate gathered statistics on weather, cost of living, crime rate, health care quality, tax burden and well-being and weighed them equally to compile the ranking, which is released annually.

New York ranked last because it has the highest tax rates in the country and the fourth highest cost of living, according to Bankrate. Additional blows were low marks for satisfaction levels of residents and health care quality.

South Dakota ranked No. 1, joined in the top five by Colorado, Utah, North Dakota and Wyoming. New York trailed Hawaii, Arkansas, Alaska and West Virginia to round out the bottom five.

Bankrate analyst Chris Kahn said the list is meant to help people consider factors beyond climate when planning retirement, and isn't meant as an actual recommendation of where to retire. "It's hard to take a state average and have it be totally fair," he said. "With New York, that's averaging together places from Manhattan to the Finger Lakes."

Kahn said the statistics -- gathered from government and other organizations -- were the most recent available, but could be two to three years old.

For example, the tax burden statistic came from an analysis of states' 2011 fiscal years from the Tax Foundation. That study would not have included the changes to New York's estate tax that kicked in April 1, raising the estate tax exemption from $1 million to $2 million. The exemption will continue to increase until it is on par with the federal level.

Irwin Kellner, Port Washington-based chief economist at financial website MarketWatch.com, chuckled at the idea that South Dakota would be the best state for retirees, but he said the study pinpointed some of New York's flaws.

"I think on balance New York doesn't deserve to be last . . . but I don't think it would deserve to be first either."The full list of states with details on each of the factors considered can be viewed on Bankrate.com. 



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