The 10 Best and Worst States for Military Retirees

African American Sergeant U.S. Army


Cheapism is editorially independent. We may earn a commission if you buy through links on our site.
African American Sergeant U.S. Army

Vetting the States

Whether they’ve been out of the service for decades or are newly retired from the military, America's veterans need places to live where they have abundant access to quality health care, opportunities to find work, and low risk of becoming homeless. While some states provide these things to military retirees, others fall flat. A study by WalletHub compares such things as economic environment, quality of life, and health care to rank the states for military retirees looking to settle down. Here's a snapshot of the 10 best and 10 worst. What do you think? Tell us in the comments.

Sponsored: Find a Qualified Financial Advisor

Finding a qualified financial advisor doesn't have to be hard. SmartAsset's free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes.

Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you're ready to be matched with local advisors that can help you achieve your financial goals, get started now.

New Haven, Connecticut

10th Best: Connecticut

Military retirees in Connecticut have the best health care benefits in the nation, but that’s not the only bright side to being a veteran in the Constitution State. As long as their military pay is taxable on a federal income tax return, retired service members of the U.S. armed forces who are residents of Connecticut are exempt from paying state income taxes on it.

Related: Veterans Benefits You Don't Want to Miss

mt rushmore in south dakota
Portland, Maine, USA Downtown City Skyline
Sean Pavone/istockphoto

8th Best: Maine

With the fourth-highest number of veterans, Maine also offers some of the best health care benefits to military retirees. Plus, the state provides Veteran Emergency Financial Assistance for sufferers of emergencies such as damage to homes not covered by insurance from fire, floods, or hurricanes; illnesses that cause financial hardships; and any other situation that might cause them to go without shelter, food, and safety.

For more great retirement stories, please sign up for our free newsletters.

Hilton Head, South Carolina
Sean Pavone/istockphoto

7th Best: South Carolina

In terms of quality of life, military retirees in South Carolina rank third from the top based on things such as Veterans Affairs benefits, arts and entertainment establishments per capita, and fewest homeless veterans. South Carolina Gov. Henry McMaster also recently signed a bill into law to eliminate state income taxes on veterans’ retirement pay. The bill will benefit 62,627 residents and could draw more vets to retire there.

Have you joined AARP? Members age 50 and over get access to a wide range of services and benefits, including online events, classes, and community forums, as well as advice on everything from financial planning to health and wellness. Sign up here.

Coastal Alaska

6th Best: Alaska

Military retirees in Alaska have the fifth-best economic environment and sixth-best quality of life in the nation. Part of the positive economic environment these veterans enjoy is attributable to the state also having the fourth-highest percentage of veteran-owned businesses with paid employees. Alaska also boasts the highest number of military retirees in the U.S.

Autumn in Manchester, New Hampshire

5th Best: New Hampshire

The Granite State cracks the top 10 for all three of the key categories making it the best state for military retirees in New England. Not only do veterans enjoy property tax exemptions here, but the state has the highest percentage of veteran-owned businesses with paid employees. 

City Dock in Annapolis, Maryland

4th Best: Maryland

Quality of life is best for military retirees in Maryland. While the state offers weaker tax exemptions than some on military retirement pay, its legislature is being called on to consider a full exemptions and entice more veterans to come. The state already has the third-highest number of job opportunities for veterans looking to start post-military careers.

Minneapolis Skyline Aerial With Park And Lake

3rd Best: Minnesota

With the fifth-highest number of job opportunities for veterans and military retirement income tax exemptions, Minnesota knows how to treat former military to get them to stick around. The state also has the second-best health care for veterans — a category that considers the ratio between the number of veterans and the number of VA hospitals, the quality of those hospitals, as well as the number of federal, state, local, and private hospitals per capita.

Florida Beach Aerial
Art Wager/istockphoto

2nd Best: Florida

Florida is the best overall state for retirees. It also has 21 military bases, making it pretty easy for veterans to get to a VA hospital when they need medical care, and a slew of organizations designed to help military retirees relocate there. Yet one of the biggest benefits is the tax environment: Florida doesn’t charge state income tax, so military retirees don’t have to pay state taxes on their pensions, leaving them with more disposable income.

Virginia Beach, Virginia

Best for Military Retirees: Virginia

Virginia boasts the third-highest number of military retirees in the nation, but what leads so many veterans to make the state their permanent home? Virginia not only has the second-highest percentage of veteran-owned businesses with paid employees, but also the fourth-highest amount of job opportunities and second-lowest percentage of homeless vets. 


10th Worst: Iowa

The Hawkeye State serves about 500 veterans through the Iowa Veterans Home, which was founded in 1887 and covers 150 acres, making it the fifth-largest veterans retirement home in the country. It even has around 900 employees. But the home isn’t enough to make up for low scores on health care, quality of life, and economic environment. 

Castle Hill Lighthouse, Newport Rhode Island

9th Worst: Rhode Island

The reputation of the Rhode Island Veterans Home in Bristol isn’t quite as alluring as the one in Iowa — there are reports that military retirees there are frequently victims of theft. One notable incidents involved a nearly 100-year-old Medal of Honor recipient who was robbed of it months after moving in. The older generation of veterans in the state isn’t the only one suffering: Rhode Island has the third-fewest job opportunities for vets and the lowest number of VA health facilities per veteran in the nation.

San Francisco lightrail drive to  the sea under Sunset

8th Worst: California

Despite cracking the top 10 for quality of life for its military retirees, California’s overall score is dragged down by being second from the bottom in terms of economic environment. Housing affordability for veterans is second-worst, behind only Hawaii. And California has the third-lowest percentage of veteran-owned businesses, the fifth-lowest number of job opportunities for vets, and is tied with four others for having the highest percentage of homeless veterans.

Vicksburg, Mississippi.

7th Worst: Mississippi

According to World Population Review, Mississippi is the second-most unhealthy state and has the highest percentage of obese residents at 40.8. That makes health care important for military retirees in the Magnolia State, but it ranks second-lowest for veteran health care. 

Santa Fe, New Mexico, USA
Sean Pavone/istockphoto

6th Worst: New Mexico

When military retirees search for somewhere to settle, they often consider the economic environment — and New Mexico’s is pretty bleak, as the fourth-worst in the nation. New Mexico offers the third-lowest amount of job opportunities for military retirees in search of a new career.

Space Needle and Seattle downtown

5th Worst: Washington

Despite running four veterans homes, Washington ranks close to the bottom for health care and economic environment for military retirees. The Evergreen State also has the second-lowest number of job opportunities for veterans looking to begin a new career.

Sunset in Downtown Portland Oregon

4th Worst: Oregon

After serving their country and sacrificing some freedoms for the greater good, too many veterans wind up homeless. Oregon is tied with four states for having the highest percentage of homeless vets, and is the fifth-least-affordable in terms of housing for military retirees.

The United States Capitol building DC

3rd Worst: District of Columbia

It might be the nation’s capital, but Washington, D.C., has the third-lowest number of veterans per capita. It also has the third-lowest number of VA health facilities per veteran, and its veteran housing is the fourth-least affordable in the country. It’s tied with four states for the highest percentage of homeless veterans.

Reno , Nevada at dawn

2nd Worst: Nevada

Las Vegas might be home to a handful of military bases, but Nevada ranks third from bottom in terms of health care for veterans. Military retirees looking to start a new career should steer clear of Nevada, too — the state has the fewest job opportunities for veterans. It’s riddled with homeless veterans.

Montpelier, Vermont Skyline

Worst for Military Retirees: Vermont

Ranking dead last for economic environment, Vermont is one of only three states that fully tax military pensions. The issue to tax these pensions is a hot topic of debate; a bill to create an exemption could help convince more military retirees to stay.