Alabama Best Places to Retire – A Guide
If you have been looking for the best Alabama retirement communities this website has the data and opinions you need. Choose from the best places to retire in Alabama such as Eufala or Fairhope. Updated Aug 2018.
Overall
Alabama has become a top state for retirement communities because of its warm climate and welcoming community. The Tax Foundation’s research indicates that Alabama is one of the most tax-friendly states in the union. Winters are warm mild and the long sea coast has many great beaches and harbors Alabama’s population was about 4.9 million in 2016. The median age is 38.2, slightly older than the U.S. average.
Climate
The Alabama climate is humid subtropical. Moist air from the Gulf of Mexico produces hot, humid summers with frequent thunderstorms. Winters are mild, even more so along the coast. Average January low temperature is 40, high is 61.
Economy & Home Prices
The Alabama 2014 household income was $43,511 vs. U.S. median of $53,482. The statewide Home Value Index was just $127,500 in mid 2018 (Zillow); just a little more than half of the $218,000 national figure. The median home selling price in Birmingham was $214,800 in mid 2018 (NAR), while in Mobile the median was $143,000. The cost of living in Alabama is well below the U.S. average. In Mobile the Numbeo.com Cost of Living Index plus rent is a very low 45.60 (100 is New York City). The cost of living is 12th lowest in the U.S. according to the Meric Index – https://www.missourieconomy.org
Taxes
Tax Burden: Alabama has a low tax burden compared to other states (39th highest at 8.7% of income – 2012).
Marginal Income Tax Rates. Alabama top marginal income tax rate is 5.0%, which applies once income reaches $3000. There are no standard deductions or personal exemptions.
Retirement Income Exemptions. There are a number of income sources that are exempt from state income tax. Those exempt sources include federal and state pensions, “defined benefit plan” pensions, and social security benefits.
Social security exemption. Social security is exempt.
Sales Tax: There is a 4% sales tax in Alabama, and it is included on food. Local communities can add their own sales tax.
Property Taxes: Property taxes are the lowest in the nation; additionally, homeowners 65 and older are exempt from state property taxes if they are disabled or make less than $12,000. In a recent year the median property tax was $398/year.
Homestead Exemption. Alabama has a homestead exemption; people over 65 get a larger one.
Estate and/or Inheritance Taxes. The state does not impose a separate state estate or inheritance tax. The state collects the maximum credit allowed on the federal estate tax return for state death taxes.
Link to Alabama Department of Revenue.
Certified Retirement Communities
Alabama does not have a certified retirement community program.
Best Retirement Communities
Alabama has attracted many developers of retirement and 55+ active adult communities. One of the most interesting retirement communities in the U.S. is in Alabama, the former utopian community of Fairhope near Mobile. Another top-rated one is historic small town of Eufaula.
This site will also get inside information on retirement living communities in the neighboring states of Mississippi, Louisiana, Georgia, and Florida.
Get started with reviews of the Alabama retirement towns on the right.
