Should You Retire in Rhode Island?

Here's a clue to help you consider whether you want to relocate in retirement to Rhode Island: Its state nickname is the Ocean State. Nestled in New England, it's one of the original 13 colonies and home to the historic towns of Providence and Newport.

By some measures, Rhode Island falls short of ideal, ranked the 30th-best state for retirement by Bankrate. For example, it's not one of the 41 states that don't tax Social Security benefits. Pension income, along with withdrawals from 401(k) and IRA accounts, are either partially or fully taxable. (There are exemptions of up to $20,000 each for pension and annuity income, which can ease the pain significantly.) The state has an estate tax, too.

image source: Getty Images.

What about healthcare? Rhode Island scores fairly well, ranked the 16th-best state in the nation for elderly healthcare by MedicareGuide.com.

The cost of living, according to the World Population Review, is about 11% above the national average -- which isn't ideal, but not that terrible, either. The typical home price in Rhode Island was recently $478,722 -- about 31% above the national average. Car insurance, too, is a little steep. It averages $3,494 annually, $477 above average.

If your pencil is about to scratch Rhode Island off your list, hold off on that. Rhode Island is a charming small state, with beaches, parks, and plenty of recreational opportunities. It's home to the Johnson & Wales culinary school and many terrific restaurants. There's much history and culture to enjoy in Rhode Island -- including theater and music festivals -- and Rhode Islanders are also only one to three hours away from Boston, Vermont, New York City, and Maine.

The climate, meanwhile, is moderate. Hurricanes do hit the state on occasion, though.

If you're intrigued, read up on Rhode Island. Consider spending at least a few months in any location you're thinking about to make sure it's a good fit for you and your overall retirement plan.

The $22,924 Social Security bonus most retirees completely overlook

If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known "Social Security secrets" could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $22,924 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies.

View the "Social Security secrets" »

The Motley Fool has a disclosure policy.