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12 Surprisingly Great Places to Retire in the Midwest

Stacy Rapacon, Online Editor, Kiplinger.com

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America's Heartland has not been getting a lot of love lately. Among the 12 states that the U.S. Census Bureau groups together as the Midwest region, five (Illinois, Kansas, Ohio, Iowa and Michigan) make up half of the top 10 states people moved out of in 2018, according to United Van Lines' annual national movers study. Most report leaving the area due to a job change, but many credit retirement for their relocation, too. In fact, only 2% of pre-retirees plan on moving to the Midwest, according to a survey by Merrill Lynch and Age Wave, a research firm focused on the aging population.

But we still think the Midwest has plenty to offer retirees. Many states in the region offer affordability, beautiful scenery, an abundance of activities and quality health care. Indeed, two midwestern states rank among the top four best states for retirement in 2018. If you're ready to go against the grain and head to the Midwest for your own retirement, we suggest you consider the following spots. We highlighted one great retirement destination in each state, taking into account living costs, safety, median incomes and poverty rates for retirement-age residents, as well as residents' sense of well-being and the availability of recreational and health care facilities. Here are our retirement picks in the 12 midwestern states. Some (if not all) are sure to surprise you.

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Peoria, Ill.

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City population: 115,424

Share of population 65+: 14.3%

Cost of living for retirees: 5.9% below the national average

Average income for population 65+: $53,116

Community score: 58.6

State's tax rating for retirees: Mixed

A big draw for this relatively small city is its affordability. Housing costs for retirees are particularly low, 20.8% below the national average. Indeed, the median home value is a rock-bottom $89,000, compared with the $229,000 median for the U.S. And a private room in a nursing home costs just $6,798 a month; the median across the U.S. is $8,365 a month.

And yet, plenty of money has been pumping through the city, in a bid to further to develop the downtown area. The Downtown Development Corporation of Peoria recently assisted a number of projects, including the issuance of 714 construction permits in downtown with an estimated value of $74 million. Already the Riverfront area offers a vibrant setting with a number of eateries, shops and attractions, including the Peoria Riverfront Museum complete with its Giant Screen Theater and Dome Planetarium. The museum hosts a senior program with a free bi-monthly morning lecture series and free admission to the museum every second Wednesday of the month to guests age 60 and up. Also, the Peoria Park District offers 64 park sites with miles of hiking trails, golf courses, nature center and more.

See Also: How All 50 States Tax Retirees

Fort Wayne, Ind.

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City population: 262,450

Share of population 65+: 13.4%

Cost of living for retirees: 11.5% below the national average

Average income for population 65+: $47,848

Community score: 59.7

State's tax rating for retirees: Least Tax Friendly

The Fort Wayne metro area's affordability will not cost you in amenities. Despite being home to a nice collection of quiet neighborhoods, it also houses a thriving arts scene and hosts a number of festivals and events throughout the year, including the family-friendly Three Rivers Festival in the summers. Indeed, the three local rivers--the St. Marys, the St. Joseph and the Maumee--are a main feature of the area, providing ample opportunities for canoeing, kayaking and cruising. More outdoor attractions: Fort Wayne is more than 80 parks and 100 miles of hiking and biking trails.

Fort Wayne is by no means a metropolis, but if you ever feel the need for a small-town escape head two hours south to Richmond, the cheapest small town in America. Its claim to fame (other than being budget-friendly): Some of the earliest jazz records were recorded in Richmond by such greats as Duke Ellington and Louis Armstrong.

See Also: Cheapest U.S. Cities for Early Retirement

Des Moines, Iowa

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City population: 214,778

Share of population 65+: 11.7%

Cost of living for retirees: 9.4% below the national average

Average income for population 65+: $48,740

Community score: 65.7

State's tax rating for retirees: Not Tax Friendly

For retirees looking to live in a big city on a small budget, Des Moines is a good choice. Affordability is just one reason the Milken Institute ranked the state capital fifth out of 100 large U.S. metro areas for successful aging. Des Moines also boasts a strong economy and plenty of health care facilities specializing in aging-related services.

Retirees won't lack for things to do, either. There are numerous museums and arts venues, including an outdoor sculpture park, a zoo and botanical gardens. There's even a casino and racetrack in nearby Altoona that hosts annual camel, ostrich and zebra races (sorry, no wagering on these exhibition races allowed).

See Also: 10 Cheapest States Where You'll Want to Retire

Manhattan, Kan.

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City population: 55,427

Share of population 65+: 8.2%

Cost of living for retirees: 8.4% below the national average

Average income for population 65+: n/a

Community score: n/a

State's tax rating for retirees: Least Tax Friendly

The Little Apple may not have all the bright lights and major metropolitan allure of New York City, but it has plenty to recommend itself, as well as significantly lower costs. (The cost of living for retirees in New York's Manhattan is 123.5% above the national average with housing a ridiculous 406.2% above average.) Housing costs for retirees in this Manhattan are particularly affordable at 17.2% below the national average. And yet, the average income for all households with earnings is a comfortable $64,135 a year.

Home to Kansas State University, Manhattan affords residents attractive college-town amenities, including the privilege of calling the school's top-notch athletics program your home team. One particularly senior-friendly offering: The university, in collaboration with the local UFM Community Learning Center and the University of Kansas Osher Institute, offers courses year-round for $50 each, along with special events, aimed at encouraging lifelong learning, especially for locals age 50 and older. The city is also developing an expanded trail system--beyond the existing 40 miles of trails throughout the city--for walking and biking throughout the city.

SEE ALSO: Best States for Low Taxes: All 50 States Ranked

Ann Arbor, Mich.

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City population: 119,303

Share of population 65+: 11.3%

Cost of living for retirees: n/a

Average income for population 65+: $82,971

Community score: 66.3

State's tax rating for retirees: Not Tax Friendly

Another college town well suited to retirees, Ann Arbor is home to the University of Michigan with all its educational programs (including the Osher Lifelong Learning Institute), sporting events and cultural affairs. The university also runs the Geriatrics Center & Institute of Gerontology, which focuses on health care issues that come with aging. Along with its research facilities, medical facilities and staff, the Center offers programs and classes to help older adults maximize their good health and independence.

In fact, Ann Arbor's health care facilities are top-notch, helping to earn it a sixth-place ranking among small metro areas for successful aging, according to the Milken Institute. The area's public transportation options are another noted winning attribute for older residents. A downside, however, is affordability. Overall living costs are 27.1% above the national average, according to Sperling's BestPlaces, and the median home value is $378,600, versus just $153,000 for the rest of the state, according to Zillow.

SEE ALSO: College Towns: 12 Smart Places to Retire

Mankato, Minn.

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City population: 41,241

Share of population 65+: 11.0%

Cost of living for retirees: 4.4% below the national average

Average income for population 65+: n/a

Community score: n/a

State's tax rating for retirees: Least Tax Friendly

If the cold winters and equally harsh tax situation don't put you off of the North Star State, consider retiring in Mankato, about 90 miles southwest of the Twin Cities. It's still a small city, but development is on the rise, and the local economy is growing fast. Revitalization projects have added a nice mix of restaurants, shops, entertainment venues and more to the downtown area in recent years, and the city's five-year strategic plan aims to spread that level of development throughout the Minnesota River Valley. Some goals of the plan include adding housing, specifically within walking distance of where jobs and shops are; expanding Riverfront Park and other recreational land; and possibly building a pedestrian bridge that crosses the Minnesota River to North Mankato.

So far, all that growth has yet to push up living costs. While other metro areas in Minnesota come with above-average expenses, Mankato's cost of living for retirees (and others) remains below the national average. By comparison, Minneapolis has living costs for retirees 5.7% above the national average. Unfortunately, typical incomes in Mankato are also lower, with the overall annual income for residents with earnings at $62,776, on average, compared with $64,626 in Minneapolis. Still, the poverty rate for residents 65 and older is lower at 7.8% in Mankato, compared with 12.6% in Minneapolis and 9.3% in the whole U.S.

SEE ALSO: Millionaires in America: All 50 States Ranked

Kansas City, Mo.

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City population: 476,974

Share of population 65+: 12.4%

Cost of living for retirees: 3.7% below the national average

Average income for population 65+: $47,657

Community score: 62.1

State's tax rating for retirees: Mixed

The Kansas City metro area straddles two states and offers a wide range of attractions for people of all ages including retirees. The music and arts scene is particularly vibrant, being home to legendary jazz musician Charlie Parker as well as the American Jazz Museum, the Nelson-Atkins Museum of Art, the Kauffman Center for the Performing Arts and the Kansas City Art Institute. For foodies, authentic barbecue is big, too. And you can entertain visiting grandkids with Legoland, the Sea Life aquarium and the Kansas City Zoo.

Also, while the University of Missouri's main campus is about 125 miles east in Columbia, the school brings more than 16,000 undergraduate and graduate students, as well as all the amenities of college life, to its Kansas City campus. It even offers an all-volunteer education program called Communiversity, offering a wide variety of classes and seminars to the entire metro area. Class fees range from just $10 to $18, plus a $3 registration fee, but students age 65 and older can skip the registration fee and get a discount of $1 off the first class and $2 off all subsequent classes.

SEE ALSO: 10 Things Retirees Should Never Keep in Their Wallets

Lincoln, Neb.

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City population: 277,315

Share of population 65+: 12.5%

Cost of living for retirees: 6.1% below the national average

Average income for population 65+: $50,654

Community score: 64.2

State's tax rating for retirees: Least Tax Friendly

Lincoln may not be home to financial guru Warren Buffett like Omaha, which is about an hour north, but it has plenty of other notable points to recommend it. The capital city offers an abundance of attractions, including more than 130 parks, fine restaurants, an active nightlife and a number of museums and theaters. Highlights include the Sunken Gardens (for budding horticulturalists) and the Museum of American Speed (for car enthusiasts).

Being a college town, home to both the University of Nebraska's Lincoln campus and Union College, the population may skew young. But the city is also prepared to assist its aging residents with about 30 health-care and social service facilities per 1,000 seniors, compared with about 19 per 1,000 seniors in the U.S.

See Also: 6 Great Places to Retire in New England

Fargo, N.D.

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City population: 118,099

Share of population 65+: 11.1%

Cost of living for retirees: 0.5% below the national average

Average income for population 65+: $57,580

Community score: n/a

State's tax rating for retirees: Tax Friendly

With its low costs and generous tax situation, North Dakota has consistently ranked highly among our best states for retirement. So we believe spending your golden years in the Peace Garden State to be a financially savvy choice for your retirement destination (albeit perhaps an unorthodox one). And Fargo fits the bill for affordability, with particularly low housing costs for retirees, 14.3% below the national average. Indeed, while the average cost for a private room in a North Dakota nursing home is $11,690 a month, it's just $9,644 a month in Fargo, according to Genworth.

North Dakota State University is based in Fargo and, along with a number of other area colleges, brings with it attractive amenities for retirees and co-eds alike. That includes sporting events and cultural attractions, such as numerous musical and theater performances. Just be sure to bundle up if you venture out in the winter months. The average low temperature in January is literally 0 degrees Fahrenheit, according to U.S. Climate Data, only goes up to an average low 6 degrees Fahrenheit in the surrounding months.

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Columbus, Ohio

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City population: 852,144

Share of population 65+: 9.8%

Cost of living for retirees: 7.8% below the national average

Average income for population 65+: $46,941

Community score: 61.2

State's tax rating for retirees: Mixed

The biggest city in the Buckeye State comes with some of the smallest costs. Housing is particularly affordable: The median home value in Columbus, the state capital, is just $157,500, compared with the national median of $229,00, according to Zillow.

But low costs doesn't equate to a lack of activities. Home to Ohio State University, locals can enjoy the co-ed culture, including big sporting events, concerts and cultural diversions. It also offers Program 60, which invites Ohio residents age 60 and older to take university courses free. Off campus, the downtown area has a lively scene with an eclectic mix of shops, galleries and restaurants. The Short North and German Village neighborhoods, in particular, are worth exploring.

SEE ALSO: 25 Cheapest U.S. Cities to Live In

Sioux Falls, S.D.

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City population: 170,401

Share of population 65+: 12.0%

Cost of living for retirees: 3.7% below the national average

Average income for population 65+: $46,123

Community score: n/a

State's tax rating for retirees: Most Tax Friendly

If you've never considered moving to South Dakota in retirement, perhaps you should. We recently ranked it the best state for retirees. And Sioux Falls is a particularly great spot to settle. It is filled with advantages, including a booming economy, low unemployment and hospitals specializing in geriatric services. For all these reasons, plus the city's recreational activities (including regularly scheduled morning walks and pinochle for the senior program, run by the city's Parks and Recreation department), the Milken Institute dubbed Sioux Falls the fifth best small metro area for successful aging.

And all that comes pretty cheap for retirees. Along with low living costs in Sioux Falls, the median home value is $192,900, compared with $193,700 for the state and $229,000 for the U.S., according to Zillow. Plus, the state's tax picture is one of the best for retirees.

See Also: 37 States That Don't Tax Social Security Benefits

Green Bay, Wis.

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City population: 104,796

Share of population 65+: 12.3%

Cost of living for retirees: 10.2% below the national average

Average income for population 65+: $35,380

Community score: 66.2

State's tax rating for retirees: Least Tax Friendly

The University of Wisconsin brings all the benefits of retiring in a college town to the industrial city of Green Bay. That includes a thriving cultural and arts scene, quality medical care, a walkable downtown with an array of dining and shopping options and of course sports.

And while the state's tax situation leaves something to be desired, low living costs are attractive. Green Bay is particularly affordable, with below-average costs for retirees across all spending categories. Housing expenses are notably low, with costs for retirees falling 20% below the national average. Indeed, the median home value in Green Bay is just $146,500, compared with $229,000 for the U.S., according to Zillow.

See Also: 11 Reasons You Don't Want to Retire in Florida

How We Picked the 50 Best Places to Retire

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To pinpoint one great retirement destination in each state, we weighed a number of factors:

See Also: Where to Retire: All 50 States Ranked for Retirement

  • Cost of living for retirees for major metropolitan and micropolitan statistical areas, with data provided by the Council for Community and Economic Research, includes overall costs, housing, food and groceries, transportation, utilities, health care and miscellaneous expenses.
  • Household incomes, poverty rates and number of health care facilities are from the U.S. Census Bureau.
  • Community well-being and physical well-being scores are provided by digital health company Sharecare, in collaboration with Gallup. These are two of the five elements of well-being that make up the overall Gallup-Sharecare Well-Being Index. (The other three elements are purpose, social and financial well-being.) The index is calculated on a scale of 0 to 100 and based on more than 2.5 million nationally representative surveys. Community well-being is defined as "liking where you live, feeling safe and having pride in your community." Physical well-being is "having good health and enough energy to get things done daily." We display the community score for each place we chose.
  • Population data, including the percentage of the population that is age 65 and older, is also provided by the Census Bureau. The figures are highlighted in these rankings for the benefit of readers, but were not factors in our methodology for ranking the best places to retire.
  • Taxes on retirees, based on Kiplinger's Retiree Tax Map, which divides states into five categories: Most Tax Friendly, Tax Friendly, Mixed, Not Tax Friendly and Least Tax Friendly. This information is provided for the benefit of readers but was not factored into our selections within each state.

SEE ALSO: 50 Great Places for Early Retirement in the U.S.

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Copyright 2019 The Kiplinger Washington Editors