Incline operating in front of the downtown skyline of Pittsburgh, Pennsylvania, USA.
Sean Pavone—Alamy
December 30, 2014

Does the thought of retiring to a sleepy beach town or country hamlet bore you silly? Spending your post-work years in a city has plenty of perks, including easy access to the arts, cutting-edge health care, and a diverse set of neighbors. That said, the cons of urban living (like cost) can be daunting.

There is a happy medium. We set out to find places that won’t ding your nest egg with high taxes and nosebleed prices, yet still have great attractions and plenty of your peers. Read on for five affordable small cities (populations of 150,000 to 500,000) you may one day want to call home.



Raleigh, North Carolina

Karen Malinofski—NC Museum of Art


Population: 431,700

Population 62 and over: 11.3%

Median home price: $210,000

Cost of living index: 92.3


Like all the states in this story, North ­Carolina does not tax Social Security benefits. The state has no inheritance or estate tax.

Income tax: 5.8% flat

Sales tax: 6.75% (combined state and local)

Median property tax: $1,800


This state capital’s thriving economy and proximity to top universities have long made it a prime relocation destination. And ­recently more of those new ­faces have had a few wrinkles: from 2000 to 2010 the city’s population of 55- to 64-year-olds shot up by 97%, according to the Brookings Institution. It’s not hard to see the draw: Raleigh provides a big-city feel with a low cost of living; mild, four-season weather; and, thanks to all those medical schools, world-class health care.


Midtown/North Hills: Retirees looking for an attractive price and a practical location should shop north of downtown, says local real ­estate agent Kim Crump. There you’ll find spacious townhouses and condos starting at around $200,000.

Downtown: Prefer to be in the center of things? Those willing to pay about twice that price may consider the new condos and lofts downtown.


Food: The city has a diverse restaurant scene, with everything from Afghan cuisine to Southern barbecue.

Music: The 5,000-seat Red Hat Amphitheater hosts the big acts, while the opera and symphony perform at the Duke Energy ­Center for the Performing Arts.

Art: A range of work is on display in galleries, public spaces, and parks. Or take in the 30 Rodin sculptures at the North Carolina Museum of Art.

Education: North Carolina State University’s lifelong-learning program offers affordable courses and study trips on topics including American poetry, digital photography skills and Civil War history.


Pittsburgh, Pennsylvania

Saturday Farmers Market on The Strip District, Penn Avenue, Pittsburgh, Pennsylvania
Philip Scalia—Alamy


Population: 305,700

Population 62 and over: 17%

Median home price: $143,000

Cost of living index: 98.8


Distributions from most ­retirement plans, including qualifying 401(k)s and IRAs, are largely ­exempt.

Income tax: 3.07% flat for Pennsylvania, 3% for Pittsburgh

Sales tax: 7%

Median property tax: $1,700


Talk about a comeback. At the turn of the 20th century Pittsburgh was an economic and cul­tural hub, home to Andrew Carnegie and ­other captains of industry. Then came deindustrialization and job losses in the 1980s. Now the city is polishing its rusty image by converting old factories and warehouses into office space, galleries, and lofts. The once-dwindling population is also bouncing back; Pittsburgh’s population is growing for the first time since the 1950s. For retirees, Pittsburgh offers a true urban experience, including good public transportation, pro sports, and a host of colleges and universities, all at a bargain price.


The northeast and south: Homes in popular neighborhoods like Highland Park are now going for around $400,000, says Maryann J. Bacharach at Howard Hanna Real Estate. The South Side, where homes tend to be a bit smaller, is slightly more affordable, with prices coming in around $300,000 or so.


Museums: The four Carnegie Museums span art, science, natural history, and a collective 1.3 million square feet. The Andy Warhol Museum is a local favorite (the artist grew up here).

Performance: Renovated concert halls are home to a thriving symphony, ballet, and opera.

Sports: Thanks to the Steelers, Penguins, and Pirates, superfans can stay busy all year.

Outdoors: There are four large city parks under the Pittsburgh Parks Conservancy, including the 644-acre Frick Park, where you can try lawn bowling or tennis.

Lexington, Kentucky

Triangle Park with Victorian Square (shops) in background, downtown Lexington, Kentucky USA
Blaine Harrington III—Alamy


Population: 308,400

Population 62 and over: 13%

Median home price: $151,000

Cost of living index: 92.6


There’s no local tax on retirement income in Lexington. Homeowners 65 or older get a property tax break. Some family members are exempt from the inheritance tax; there is no estate tax.

Income tax: State income tax is 6%. There’s technically no local income tax– there is, however, a tax on gross wages of 2.25%.

Sales tax: 6%

Median property tax: $1,700


Retirees looking to mix city activities with country charm will find a lot to love here. Lexington’s historic downtown is packed with galleries, restaurants, and boutiques. But drive just a few minutes and you’re in the rolling hills of Bluegrass Country.

The city is also home to one of the country’s oldest and most robust lifelong-learning programs, as well as the top-scoring Univer­sity of Kentucky Albert B. Chandler Hospital, which has received accolades from the American Heart Association and National Cancer Institute.


Downtown: Over the past decade, a crop of new condos and loft conversions has transformed the center of Lexington. Indeed, developers got a little overzealous during the boom years, says realtor Casey Weesner, so prices stagnated and condos sat empty in the wake of the housing crash. The market has since picked up, he says, but there are still some downtown bargains to be had. You can find modern two-bedroom condos starting around $200,000.


Sports: Welcome to basketball heaven. The Wildcats, the University of Kentucky’s powerhouse team, play at Rupp Arena, which also hosts shows and big music acts.

Education: Locals age 65 and older can register to sit in on university classes, sans tuition, when­ever there are open seats. University of Kentucky’s lifelong learning initiative is celebrating its 50th anniversary in 2014 and is one of the oldest of its kind in the country. The school’s Osher Lifelong Learning Institute offers classes for the 50-plus set.

Arts: The campus also boasts the Singletary Center for the Arts. Downtown, the Kentucky Theatre shows independent and classic films.

Outdoors: Churchill Downs, home of the Kentucky Derby, is 90 minutes away. Bikers can hop on the 12-mile Legacy Trail, which leads to the equine events at Kentucky Horse Park.


St. Petersburg, Florida

Beach at Pass a Grille, St Pete Beach, Gulf Coast, Florida, USA.
Ian Dagnall—Alamy


Population: 249,700

Population 62 and over: 20%

Median home price: $148,000

Cost of living index: 91.3


Retirement income is not taxed. Permanent residents get a property tax exemption of up to $50,000.

Income tax: None

Sales tax: 7%

Median property tax: $1,500


Can’t imagine retirement without a beach? In St. Pete you can dip your toes in the Gulf of Mexico or Tampa Bay—plus play a round of golf, eat virtually any type of cuisine, and see famous art, all in a single day.

While St. Petersburg is undoubtedly a ­retiree hotspot, the city has also drawn more young families in recent years, says St. Petersburg agent Rachel Sartain. The mix helps keep the city vibrant and stocked with boutiques, galleries, and restaurants.


Downtown: The market for new apartments and condos was flattened by the bust, but developments are now back on track and in many ­cases selling out quickly. New two-­bedrooms downtown start at around $300,000, says St. ­Petersburg agent ­Rachel Sartain.

Surrounding neighborhoods: If that’s too expensive, going five or 10 minutes outside of downtown brings ­prices down ­dramatically; condos in many central areas start in the $200,000 range, says Sartain.


Beaches: One of the nation’s best (according to Trip­Advisor readers), Saint Pete Beach, is about a 20 minute drive from downtown.

Art: Try the Dalí Museum for works by the Spanish surrealist, or the Museum of Fine Arts for Monet and O’Keeffe.

Sports: Tropicana Field is home to the Tampa Bay Rays. There are also plenty of golf courses, including Mangrove Bay, a par-72 championship course.

Boise, Idaho

A mountain biker rides through the foothills above Boise, Idaho.
Joshua Roper—Alamy


Population: 214,200

Population 62 and over: 15%

Median home price: $208,000

Cost of living index: 94.3


There is no inheritance or estate tax.

Income tax: Highest is 7.4%

Sales tax: 6%

Median property tax: $1,400


Moving to a mountain town means easy access to skiing, hiking, golf, fly-fishing, and more. Unfortunately, it also usually means jaw-dropping home prices, a dinky airport, limited health care, and tourists galore. Not in Boise. Yes, locals here can ski at Bogus Basin 16 miles from downtown, stroll or bike 85 miles of trails, and paddle or fish on the Boise River, which runs through town. But they’ll also find low taxes and affordable homes. Plus, Boise has become a nucleus of culture and health care. Saint Alphonsus Regional Medical Center has been ranked in the top 5% of hospitals nationwide for clinical performance by HealthGrade.


North and east of downtown: Prices in the city center are steep, so buyers looking for value typically concentrate on the surrounding neighborhoods. You’ll find two-bedroom condos or small single-family houses priced at about $300,000 in the North End, says Michael Edgar of Team One Elite Realty.


Outdoors: Walk along the Boise River Greenbelt or explore the trails winding out of Hull’s Gulch or Camel’s Back Park. The city has two open-air Saturday markets, which are a great place to find produce and bump into friends.

Art: The Boise Art ­Museum has more than 3,000 permanent works and presents diverse exhibitions ranging from site-specific installations to collections of ancient artifacts.

Performance: Grab tickets for the opera, philharmonic, or ballet. Boise State’s Morrison Center hosts national tours of Broadway shows, stand-up comedy, and live music, while the Shakespeare Festival fills a 770-seat outdoor amphitheater. And there’s more to come: Construction is under way for a new $70 million, 65,000-square-foot cultural center, slated to open in 2015.

This story originally ran in the November 2013 issue of Money magazine



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