6 Things Florida Retirees Spent the Most Money on in 2023
Florida has long been a prime destination for those looking to retire. In fact, 21.6% of the state’s population is age 65 or older. Considering its abundance of beautiful beaches, plenty of sunshine and tax-friendly laws for retirees, it’s no wonder that Florida is still a popular retirement spot.
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But, like anywhere else in the country, the Sunshine State has its fair share of expenses to consider. So, if you’re thinking about retiring in Florida, you’ll want to be prepared — especially if you’re living on a fixed income.
Here are the top things Florida retirees spent their money on in 2023, according to financial experts and retirement planners experienced in working with clients in the state.
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Housing
According to Zillow, the average cost of a home in Florida is $391,213. This is a 1.5% increase from this time last year. While this is much lower than the national median sales price of a home — $513,400 — certain areas of the state are much more expensive than others.
“Housing is definitely one of the biggest expenses. Both buying and renting places to live are really expensive right now,” said Diana Howard, the financial analyst at CouponBirds. “A lot of remote workers moved to Florida during the [COVID-19] pandemic because of the nice weather and not having to pay state income tax. This drove housing costs way up due to high demand but not enough homes available.”
For retirees who own their home already, this might not be a problem. But retired homeowners still have to account for other costs, like home maintenance, property taxes and insurance.
“Home insurance is hugely expensive due to the risk of hurricanes and other disasters that hit Florida a lot,” said Howard. “On average, Florida homeowners pay $2,385 per year for coverage — a whopping 31% higher than the national norm, according to NerdWallet. And taking out policies for more expensive homes drives premiums even higher — insuring a $500,000 house runs about $4,997 annually.”
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Healthcare
Healthcare has been another major expense for Florida retirees, and it’s likely to continue to be one in coming years.
“Healthcare is another major cost, partly because Florida employers cover less of health insurance premiums compared to other states,” said Howard. Upon leaving the workforce, retirees may be responsible for more out-of-pocket costs — especially if they retire early or don’t qualify for Medicare.
Although data for 2023 isn’t available yet, Howard cited a study from 2022 about health insurance costs in the state.
“In 2022, Floridians spent a median of 16% of [their] income on health insurance, while the national average was just 11.6%,” she said. “Many Florida hospitals also charge really high rates.”
Josh Michaels, a financial specialist, CEO of Money4Loans and retirement planner with a significant client base in Florida, added, “The state’s popularity as a retirement destination means a higher demand for healthcare services, often leading to increased expenses in this area.”
Utilities
According to AARP, Florida ranks in the top 10 when it comes to the cost of utilities, with an average household utility bill of about $325, as reported in March 2023.
“Utility fees in Florida are also expensive, with many households paying over $300 per month,” Howard confirmed. “The cost of electricity keeps rising, with the current rates in Florida reaching $0.15 per kilowatt-hour.”
There are many reasons why utilities are such a high expense for Florida retirees. All those hot days lead to continuous use of air conditioners. Along with this, the cost of importing natural gas to the state results in higher overall costs, said Howard.
“In addition,” Howard added, “Florida frequently experiences severe weather conditions, such as hurricanes and tropical storms, which results in higher costs for utility repairs.”
Food
The cost of food at home — or groceries — rose by 13.5% in 2022, according to the Bureau of Labor Statistics. Although the rate of inflation has slowly started to level out, food prices are still high.
The average cost of food per year for early retirees — individuals ages 55 to 64 — is $6,800. For those ages 65 to 74, that number drops slightly to $6,303.
As for Florida retirees who dine out a lot or host gatherings at home, food costs can be substantially higher. The same goes for those with special dietary restrictions or needs.
Transportation
By the time they retire, many people have already paid off their auto loan. But even debt-free retirees generally still have to pay for car insurance. According to MarketWatch, auto insurance tends to cost more in Florida than it does in other states. In 2023, the average cost of car insurance was around $270 a month — or $3,244 a year.
Then, there’s the cost of vehicular maintenance and gas. These costs can add up fast, especially for retirees who have older vehicles or those that require more frequent — or expensive — repairs.
Of course, many Florida retirees don’t bother with a personal vehicle at all. Those who live in larger cities especially might rely on public transportation, like buses or ridesharing services. Although this option might be cheaper than owning a vehicle, it’s still a major expense for many people, especially those who live in less urban areas.
General Living Expenses
The cost of general living varies by person, but it’s one of the biggest expenses for Florida retirees.
“As an experienced retirement planner with a focus on Florida retirees, I’ve noticed some trends in the major expenditures for this demographic in 2023,” said Scott DePeralta, president of Scott DePeralta Consulting LLC. “General living expenses take up a large portion of retirees’ budgets.”
General living expenses can include recreational activities, entertainment or travel. It can also include gifts, insurance or pension plans, pet-related expenses, dining out and more.
According to DePeralta, the average retiree needs to earn around $54,487 a year to live comfortably. On top of that, they should have a 20% financial buffer, just in case of unexpected costs.
“Despite Florida’s reputation as a retiree haven, the cost of living has been steadily increasing,” DePeralta said.
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