4 States Where Social Security Alone Could Cover Your Basic Expenses (and Where It Falls Way Short)

There’s no state in the U.S. where Social Security benefits alone can cover a comfortable middle-class lifestyle. 

According to the latest monthly snapshot from the Social Security Administration, the average monthly benefit paid to retirees is $2,085.98. That comes to $25,032 a year. 

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Still, in some states you could potentially cover basic living expenses with your benefit. If you can cover housing, transportation, food and healthcare with your Social Security benefits, you’ll enjoy a far more stable retirement than many retirees.

Check out these states where Social Security alone can sometimes cover basic living expenses. 

1. West Virginia

Housing is the greatest expense for most American households — and West Virginia offers the cheapest real estate in the country, with homes averaging $178,702, per Zillow. On the rental side, Zillow puts the average rent at $1,200. 

It isn’t just housing that’s cheap in West Virginia, either. The state ranks fourth lowest for cost of living, according to MERIC. A retiree collecting the average Social Security benefit and paying average rent would have nearly $900 each month for transportation, groceries and healthcare.

2. Mississippi

Real estate also remains affordable in most of Mississippi, where the average home costs $196,333. A 20% down payment and a 30-year mortgage at 6.5% interest would leave you with a monthly payment around $1,368 including property taxes and insurance. 

“The housing piece is really the deciding factor when you compare cost of living,” explained retirement planning expert Steve Sexton of the Sexton Advisory Group. “In a state like Mississippi, a retiree who owns their home outright and has relatively low property taxes may be able to cover their basic expenses fairly comfortably with Social Security.”

The Magnolia State also ranks sixth lowest for cost of living overall, making it a low-cost option for retirees trying to stretch their budgets.

3. Oklahoma

Which state ranks lowest on MERIC’s cost of living index? Oklahoma, or as the locals call it, the Sooner State. 

The average home will set you back $223,612, and the average monthly rent costs $1,450. That would still make it tight to also cover transportation, groceries and healthcare, but it gets easier if you own your home outright. It also helps if you own your car free and clear. 

4. Arkansas

Housing costs look nearly identical in Arkansas, where the average home costs $225,822 and rents also average $1,450. 

“Insurance rates in Arkansas are lower because of lower overall disaster risk,” said finance expert Melanie Musson with Quote.com. “It also helps that Arkansas doesn’t tax Social Security benefits. Plus, many seniors appreciate the warm climate where they don’t want to worry about winter driving conditions.”

The state ranks eighth cheapest on MERIC’s cost of living index, making it a strong candidate for retirees trying to cover basic expenses with Social Security alone. 

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At the other end of the spectrum, avoid Hawaii, California, New York, Massachusetts, New Jersey and Washington. 

Homes average more than a half-million dollars in each of these states. In Hawaii, the average home costs $833,877. It’s not much lower in California, at $773,735. 

Renting won’t save you, either. The average rent alone costs more than the average Social Security benefit in these states. 

Sexton said you need to plan for more than just your current monthly living expenses.

“You need breathing room for irregular bills like a new roof, major car repairs, dental work, or an unexpected medical expense," he noted. "Your budget can derail pretty quickly if every dollar of Social Security is already committed and you don’t have extra cash available.”

As a final thought, you can find affordable regions even in middle-cost states like Florida. In rural areas in particular, you can potentially cover your basic expenses with Social Security benefits — especially if you own your home. 

This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.

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