Why Retiring in One of These 10 Midwest Cities Might Be Your Best Financial Decision Yet

The Midwest offers a pretty neat retirement package when it comes to stretching your dollars. In many Midwestern cities, you can snag a three-bedroom house for what you’d pay for a tiny condo in popular coastal cities. Plus, everyday expenses, including groceries, utilities, and car insurance, typically cost less in these states. You might feel like you can actually enjoy life—rather than pinching pennies. 

In 2025, Investopedia and Travel + Leisure have identified the top 50 best places to retire in the U.S. to help you do just that, including 10 places in the Midwest. Our editorial staff evaluated each location based on income tax policies, proximity to a major airport, access to health care, and cultural activities.

But our main criteria was affordability, and our top picks for retirement destinations in the Midwest offer low cost of living combined with other features that could make retirement life more enjoyable and affordable. 

Key Takeaways

• For those keen on retiring in the Midwest, cities in South Dakota, Ohio, Missouri, Iowa, Indiana, and Michigan are included in our list of top picks.
• The biggest draw of retiring in the Midwest is definitely affordability; it’s possible to get a spacious three-bedroom house for what you’d pay for a tiny apartment in a coastal city.
• Daily expenses, from groceries to utilities, typically cost less, too. 
• This isn’t just about saving money though; it’s about having the freedom to actually enjoy retirement. 

Top Retirement Destinations in the Midwest

1. Gregory, South Dakota 

Gregory, South Dakota is a tiny town of about 1,200 people located in Gregory County, in the southeastern part of the state. 

The cost of housing in the area might make your jaw drop if you’re used to city prices; the median monthly cost of housing is only $589. Monthly transportation and food costs are also low, even by Midwestern standards. The median home value in Gregory County is $129,000, so if you’re considering selling your home in a pricier region to move here, you could potentially buy a place in Gregory outright (and kiss those mortgage payments goodbye). 

Important

The state of South Dakota has no income tax. So, when your Social Security checks come in, or you’re withdrawing from your 401(k), IRA, or pension, you get to keep more of your money.

If you’re looking for a lifestyle full of peace and quiet (and savings), Gregory might be the place for you. And, if you’re used to having easy access to restaurants and shopping options nearby, you can always drive a couple of hours to Eppley Airfield, in Omaha, Nebraska, and catch a flight to somewhere with more hustle and bustle.

2. Toledo, Ohio

The housing market in Toledo is pretty appealing. The median home value hovers around $155,200. If you’re renting, it’s not unusual to find a decent place under $900 per month. In Lucas County, where Toledo is located, the median monthly housing costs are $953.

Toledo has a larger population—around 260,000—so you’ll have the advantages of a larger city, including a popular zoo, an art museum, and proximity to other larger cities, such as Detroit and Cleveland. The Toledo Zoo has polar bears, rides, and an aquarium, while The Toledo Museum of Art is known for its significant collection of early modern European art, including works by Peter Paul Rubens, Artemisia Gentileschi, Frans Hals, Rachel Ruysch, and El Greco. The museum’s glass collection is also notable and includes examples of the studio glass movement, which originated in Toledo.

Tip

Ohio also has some nice tax breaks for retirees—Social Security benefits aren’t taxed at the state level—and monthly county taxes in Lucas County are very affordable, around $513 per month. 

3. Poplar Bluff, Missouri

Poplar Bluff is a charming Midwestern town, nestled in the foothills of the Ozark Mountains in southeastern Missouri. If you’re a lover of hiking and camping, Poplar Bluff is close to the Mark Twain National Forest. For fans of fishing or kayaking, Lake Wappapello, a beautiful 8,400-acre lake, is just a short drive away. The Ozark National Scenic Riverways, famous for its crystal-clear springs and caves, are also nearby.

The median home value in Butler County, where Poplar Bluff is located, is $138,800. On average people in Butler County spend around $1,230 monthly on transportation. Monthly food costs in Butler County average around $536. 

When it comes to taxes, the state of Missouri offers a pretty good outlook for retirees. The state doesn’t tax Social Security benefits. However, withdrawals from your IRA, 401(k) account, or pension may be taxed depending on your income.

4. Corning, Iowa

Life in Corning, Iowa is seriously budget-friendly. Corning is a tiny little town in Adams County, with only 1,465 people, in the southeastern region of Iowa.

You should be able to snag a nice house for a reasonable price; the median home value in Adams County is $116,900. Other monthly expenses are gentle on the wallet, too. Median monthly food costs in Adams County are around $589, while transportation costs come in at $1,455 per month. Iowa won’t tax your Social Security benefits, and they’ve got some nice breaks on other retirement income, too. The state doesn’t tax any withdrawals from IRAs, 401(k) accounts, or pensions. 

While Corning’s claim to fame might be as the birthplace of Johnny Carson, the natural beauty of the region is also notable. Outdoor lovers who want an active lifestyle in retirement will feel at home in Adams County; there are many parks where you can hike and camp, and you can go fishing and boating at Lake Icaria. 

5. Farmington, Missouri

Farmington, Missouri offers some pretty attractive numbers for retirees. The median home value in St. Francois County is $155,100, which is way below the national average. 

For your day-to-day expenses, you’re looking at about $577 per month for food and $1,239 monthly for transportation. The state of Missouri doesn’t tax Social Security benefits for retirees, although the state may tax withdrawals from IRAs, 401(k)s, and pension funds. 

For a city of around 19,000 people, Farmington offers a lot of amenities. The Farmington Civic Center offers activities for adults, plus two indoor pools, an indoor track, and three courts for volleyball, basketball, or tennis. For retirees who like to get outside, Farmington is right on the edge of the Mark Twain National Forest. 

Note

The St. Louis arts scene is within day-trip distance, and, for those who enjoy partaking in a glass of wine here and there, Farmington is not far from Missouri wine country.

6. Youngstown, Ohio

Youngstown, Ohio is a Rust Belt city with a reputation for being retiree-friendly. It’s located on the Mahoning River in Northeast Ohio, at the foothills of the Appalachian Mountains.

The overall housing package in Youngstown is below the national average. The median home value in Mahoning County is around $141,000, while median housing costs come in at $792.

Other expenses are reasonable, too. The median monthly cost of food in Mahoning County is around $669. Getting around will cost you about $1,181 per month. 

Youngstown is an interesting mix of small-town vibes and sophisticated, big-city perks. Dubbed “America’s Museum,” the Butler Institute of American Art is dedicated to celebrating America’s visual arts heritage. (And it’s free!) The DeYor Performing Arts Center, home to the Youngstown Symphony Orchestra, was founded by the Warner Brothers in 1931 before the brothers moved to Hollywood (and the rest is history).  And Youngstown State University hosts many cultural events, including the Summer Festival of the Arts. 

Beautiful outdoor destinations are not far from Youngstown. Mill Creek Park has 4,400 acres of gardens, lakes, and trails right in the city. Plus, Ohio doesn’t tax Social Security income, which is a nice break for retirees.

7. Bay City, Michigan

Bay City, located just upriver from the Saginaw Bay, is a quaint city where you can live pretty well without breaking the bank. One of the biggest draws of Bay City is the lifestyle; it has a nice, small-city feel while still offering plenty to do. 

The median home value in Bay County hovers around $135,000, which is lower than other parts of Michigan and lower than the national average. Monthly expenses are reasonable, too: a two-person household in Bay County might spend around $588 per month on food. Taxes in Bay County are comparable to other cities on this list: $580 per month, and median transportation costs per month are $1,193. 

Given the low cost of living, there are a surprising number of things to do in Bay City. The historic downtown area boasts beautiful Victorian architecture and lots of local shops and restaurants. The historic State Theatre hosts concerts and shows throughout the year. Meanwhile, the Bay City Players, one of Michigan’s oldest community theaters, puts on regular productions. 

8. Mason City, Iowa

Mason City, Iowa is a medium-sized city in north central Iowa, located halfway between the capital cities of St. Paul, Minnesota and Des Moines, Iowa.

For a city its size, Mason City has a surprisingly rich cultural scene. Music Man Square celebrates the city’s connection to composer Meredith Willson. The Charles H. MacNider Art Museum, housed in a former convent, offers free admission to all visitors. Architecture buffs will love the Historic Park Inn Hotel, the last remaining Frank Lloyd Wright-designed hotel in the world. Retirees can also enjoy a nice variety of events at the North Iowa Area Community College through the Performing Arts & Leadership Series, which has featured Tony- and Grammy-winning artists. 

The cost of living in Mason City, Iowa is a major draw for retirees. In Cerro Gordo County, the median home value is $154,100, which means you can get a nice place without breaking the bank. Monthly expenses are reasonable, too: A couple in Cerro Gordo County spends an average of $866 per month on housing expenses, $650 on groceries and food, and $1,258 on transportation. The state of Iowa doesn’t tax Social Security benefits, and they won’t tax any withdrawals from your IRA, 401(k) accounts, or pension funds.

9. Saginaw, Michigan

Saginaw, Michigan is a medium-sized city, with a population of around 43,000, located along the Saginaw River. The city is considered part of the Greater Tri-Cities region of Central Michigan, which includes Saginaw, Bay City (another city that made it on our list), and Midland.

If you’re planning to make a move in retirement, it’s important to make sure the city you’re relocating to has a vibrant and active social scene for retirees. In Saginaw, you won’t be disappointed. Several senior centers in Saginaw County organize regular activities for the community. The city offers recreational options, including the Saginaw Valley Rail Trail for walking and biking and several golf courses in the area. During summer, events at Ojibway Island and the Friday Night Live concert series bring the community together.

The median home value in Saginaw County is $139,400, which gives you a lot of bang for your buck. A two-person household in Saginaw County can expect to spend $866 per month on housing, $1,211 per month on transportation, $588 per month on groceries, and $591 per month on taxes. 

10. Muncie, Indiana

Muncie, Indiana is located in east central Indiana, about 50 miles northeast of Indianapolis. The last city on our list has many perks because it’s a college town (home to Ball State University). The university brings in lots of cultural events and entertainment options. The David Owsley Museum of Art on campus is free and has an impressive collection. The Muncie Civic Theatre stages regular productions, and Emens Auditorium at Ball State University brings touring shows, concerts, and speakers.

The cost of living in Muncie is also a big plus. In Delaware County, you can find homes with a median value of around $127,600, making housing quite affordable. The median cost of food in Delaware County is $579 per month, and transportation costs usually run about $1,180 monthly. Residents of Delaware County pay $821 per month for housing expenses, on average.

Important

When it comes to taxes, the state of Indiana offers an okay outlook for retirees. While the state doesn’t tax Social Security benefits, withdrawals from your IRA, 401(k) account, or pension fund are taxed at the state level.

The Bottom Line

With reasonable housing prices and a lower cost of living than many other regions of the U.S., the Midwest provides you with the financial breathing room to enjoy your retirement years. All of the cities included in this list offer median home prices under $200,000. Your money generally goes further for everything from groceries to entertainment, and many Midwest states have friendly tax policies for retirees.

The healthcare situation is good, too. There are world-class medical centers in the region, and even in mid-sized cities, you’ll usually find strong regional hospitals. 

Plus, Midwestern metros have lots to offer in terms of arts, recreation, and access to the great outdoors. Whether you’re a city person or small-town devotee, you’ll find locations that fit your interests as well as your retirement budget.

Note

To learn more about how we created this list of best places to retire in the Midwestern U.S., read our methodology.