30 Best Places to Retire on $8000 a Month
This article takes a look at the 30 best places to retire on $8000 a month. If you wish to skip our detailed analysis on the wealthy and their retirement, you may go to 10 Best Places to Retire on $8000 a Month.
The Wealthy and Their Retirement
On February 28, 2033, millionaires were already done paying their share of social security taxes. The Center for Economic and Policy Research confirms this analysis, stating that individuals earning $1,000,000 in their salaries were exempt from social security contributions by the second month of this year, all thanks to a tax cap provision. This tax cap provision has been an integral aspect of the Social Security program ever since the program was established. As of 2023, the maximum amount of income subject to the Social Security tax stands at $160,200.
Since millionaires and billionaires earn more, it is only obvious that they contribute more to the system. However, the annual adjusted tax cap confines the maximum tax amount of the tax they are subject to, to a mere $9,932.40. This means that the affluent reach their maximum contribution threshold well before others. According to CEPR, 94% of employees earn below this amount, and will be paying social security taxes throughout the year. Moreover, since the wealthy pay into the system, they are just as entitled to receive these benefits as others. Having fulfilled their tax obligations, they can amass a substantial sum to save for their retirement years.
Similarly, the Internal Revenue Service states that the maximum amount an individual can contribute to their 401(k) plans is $22,500 for 2023. However, top executives at major companies are saving much more thanks to a special non-qualified deferred compensation program. Referred to as a 'top-hat plan,' this is a special executive retirement fund that allows the affluent to avoid paying their fair share of taxes. According to a report by The Institute for Policy Studies and Jobs With Justice, the top five executives at S&P 500 companies including Walmart Inc. (NYSE:WMT), Hyatt Hotels Corporation (NYSE:H), and The Home Depot, Inc. (NYSE:HD) have a total of $8.9 billion saved in their special tax-deferred accounts as of 2021.
These savings can be invested and grown, tax-free, until they are withdrawn. However, the average individual working in any of these S&P 500 companies gets a median annual pay that is smaller than the monthly retirement checks their executives ought to receive. Walmart Inc. (NYSE:WMT) CEO Doug McMillan has had more than $169 million saved in his deferred compensation account at the end of 2022, while 46% of eligible participants at his company have zero balances in their 401(k) plans.
Similarly, Thomas Pritzker, Board Chair of Hyatt Hotels Corporation (NYSE:H), has $91 million in his deferred compensation account, and Craig Menear, former CEO of Home Depot, has $14.8 million saved. Meanwhile, 36% of employees at Hyatt Hotels haven’t been able to contribute to their 401(k) accounts either, and 53% of eligible participants at The Home Depot, Inc. (NYSE:HD) report zero balances as well. It is safe to say that more than a third of employees at companies such as McDonalds, Petco Health and Wellness Company, Inc. (NASDAQ:WOOF), Walmart Inc. (NYSE:WMT), Hyatt Hotels Corporation (NYSE:H), and The Home Depot, Inc. (NYSE:HD) have zero balances in their 401(k) plans.
Given these astounding statistics, and the looming uncertainty regarding the future of social security funds, policy experts are suggesting a change that will impact the wealthy. To avoid the 25% benefit cuts that social security beneficiaries might face starting in 2033, a proposed solution is to smash the tax cap. This tax cap, notes policy experts, has a much greater burden on lower and middle-income workers than it does on the 6% of Americans who earn above the threshold. Eliminating the "regressive" Social Security tax cap for earnings over $250,000 can potentially help Social Security trust funds remain solvent through 2046, notes CBS News.
Nevertheless, even if these changes occur, the wealthy have enough savings to spend a handsome amount each month during their retirement years. A good monthly retirement can potentially be spending $8,000 a month for these individuals, or even $10,000 a month. This amount is more than enough to help them live a luxurious lifestyle. However, not everyone has this much saved for their retirement. The good news is, there are many awesome places to retire on $3,000 a month, $2,500 a month, or even less.
We have also curated a list of the best places to retire on $8,000 a month, so that retirees can choose the best option according to their needs and wants.
Methodology
To compile the list of 30 best places to retire on $8,000 a month, we have used several sources such as Nasdaq, Forbes, and our article on Expensive Places to Retire That are Worth It, amongst others.
Following this, we ranked the compiled places based on their monthly median rent, gathering information from platforms such as Zumper and Zillow. Our criteria involved selecting locations where monthly median rents were at or below $4,500, allowing individual retirees ample budget for additional expenditures like international healthcare insurance (averaging $500) and various living costs such as groceries, utilities, and miscellaneous expenses. The rankings are presented in descending order, starting from the highest monthly rents to the lowest.
Here are the 30 best places to retire on $8,000 a month:
30. Lausanne, Switzerland
Monthly Median Rent: $4,726
Switzerland may be expensive, but it is certainly one of the best expat retirement countries in the world. The 2022 UN World Happiness Report has ranked the country at 4th place for global happiness. Lausanne, in particular, is one of the most picturesque destinations to retire to. The city is not only clean but also safe and pedestrian friendly, with an active social scene.
29. Irvine, California, USA
Monthly Median Rent: $4,500
Deemed as one of the safest big cities in America by the FBI, Irvine has all the amenities needed for a comfortable retirement. The city offers top-notch medical services, a welcoming community, and a high quality of life. The median home price in Irvine is estimated to be $1.6 million.
28. Kahului, Hawaii, USA
Monthly Median Rent: $3,800
Kahului is Hawaii's best-kept secret, brimming with picturesque beaches and natural wonders. The area boasts a gentle tropical climate, perfect for relishing outdoor pursuits such as golf, hiking, and water sports. The median listing home price in Kahului is $1.2 million.
27. Boston, Massachusetts, USA
Monthly Median Rent: $3,800
Seniors love to retire to Boston, Massachusetts for its rich history, top-tier healthcare, and vibrant cultural scene. The city is known for its walkable neighborhoods, outdoor spaces, and a strong sense of community. Whether exploring museums or cheering for local sports teams, Boston offers a fulfilling retirement experience.
26. Berkeley, California, USA
Monthly Median Rent: $3,772
Retiring to Berkeley is possible with a monthly retirement income of $8,000. The city is revered for its vibrant cultural scene, natural beauty, and world-class healthcare facilities. According to Best Places, the cost of living in the city is 95.5% higher than the US average.
25. Palo Alto, California, USA
Monthly Median Rent: $3,695
Brimming with diversity and grace, Palo Alto is one of the best places to retire on $8,000 a month. The city is known for its high-quality healthcare, pleasant climate, and safe neighborhoods. The median listing price of a home in Palo Alto is around $3.19 million.
24. Basel, Switzerland
Monthly Median Rent: $3,622
The quality of life in Basel is as high as its cost of living. Regardless, it is possible to retire on $8,000 a month in this city. Situated along the Rhine River, Basel offers picturesque views and stunning landscapes to savor. The median home price is $1.25 million.
23. Boca Raton, Florida, USA
Monthly Median Rent: $3,500
Florida is already a hot state for retirees to move to, and Boca Raton is one of the best places to retire in Florida. Retirees get to enjoy beautiful beaches, recreational opportunities, and numerous senior-friendly communities in the area.
22. San Francisco, California, USA
Monthly Median Rent: $3,375
Retirees love San Francisco for its thriving arts scene, iconic landmarks, active lifestyle, and eclectic charm. The city's cost of living surpasses the U.S. average by 145.5%, amounting to an estimated $7,365.
21. New York City, New York, USA
Monthly Median Rent: $3,300
While New York City isn't a conventional choice for retirement due to its high cost of living, affluent retirees are drawn to its cultural richness, top-notch healthcare, and vibrant social scene. The city's diversity and world-class amenities cater to those seeking an active retirement lifestyle.
20. Huntington Beach, California, USA
Monthly Median Rent: $3,175
The surf culture and sandy shores of Huntington Beach are a hot favorite for active retirees. Apart from its amazing waves, the city promises retirees numerous golf courses, shopping centers, and pleasant year-round temperatures. The median home price in the city is $1.3 million.
19. Queens, New York, USA
Monthly Median Rent: $3,100
Retire like royalty in Queens. It's revered for its cultural richness, beaches, and parks, as well as abundant entertainment options. The cost of living in the borough is 57.9% higher than the national average.
18. Boulder, Colorado, USA
Monthly Median Rent: $3,000
Embraced by the majestic Rocky Mountains, Boulder allows retirees to live an active lifestyle. The median listing price of a home in Boulder, Colorado is $1.3 million.
17. West Palm Beach, Florida, USA
Monthly Median Rent: $2,800
Retirees can embrace an upscale lifestyle living in West Palm Beach, Florida. 16% of the population in the region comprises seniors, making it an ideal place to spend retirement years.
16. Los Angeles, California, USA
Monthly Median Rent: $2,795
Boasting a year-round pleasant climate, diverse neighborhoods, and plentiful entertainment options, Los Angeles is another ideal place to retire on $8,000 a month. Retirees enjoy an active lifestyle here, engaging in outdoor pursuits and savoring fresh fruits and vegetables throughout the year.
15. O‘ahu, Hawaii, USA
Monthly Median Rent: $2,700
O‘ahu serves as the perfect idyllic tropical escape for the retiree who loves nature. Lush landscapes, pristine beaches, and urban conveniences make it worth retiring here. The median listing price of a home in O‘ahu is $1.09 million.
14. Monterey, California, USA
Monthly Median Rent: $2,650
Retirees love to embrace the seaside living lifestyle in Monterey, California. Indulging in strolls through the city's numerous parks, savoring the sun-kissed beaches, and embracing the coastal serenity are some of the many activities to savor here.
13. Hobart, Australia
Monthly Median Rent: $2,120
Hobart, Tasmania in Australia makes it to our list because of its top-notch medical facilities, clean air, and impressive natural landscapes. The median listing price of a home in Hobart is $915,000.
12. Holland Village, Singapore
Monthly Median Rent: $2,095
Home to a vibrant expatriate community, Holland Village is a top retirement destination in Singapore. Expats love the area for its variety of restaurants, shopping areas, and cultural events.
11. Saint Jean Cap Ferrat, France
Monthly Median Rent: $2,023
Saint Jean Cap Ferrat is an ideal spot to retire if you want a life of luxury without giving up on a calm and relaxed lifestyle. From its picturesque coastline to the Mediterranean lifestyle and abundant opportunities for recreation, the region is a nice place to call home. The median listing price of a home here is $5.4 million.
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Disclosure. None. 30 Best Places to Retire On $8000 A Month is originally published in Insider Monkey.