Benefits of Retiring In Minnesota (Pros & Cons)
May 6, 2022General Retirement
It can be tough choosing a place to move to when you retire. So, if you’re looking for a U.S. state to move to, retiring in Minnesota might be a good option.
Minnesota is a particularly interesting flyover state that has witnessed a growing interest of people throughout the United States, mainly due to the local estate prices and the fact that it is home to over 17 Fortune 500 companies. As herds of people continue to flock to the state, it makes retirees wonder whether they should be doing the same. So, is retiring in Minnesota a good idea? Is it a good place for seniors to comfortably live out the rest of their days?
Minnesota has an affordable cost of living, low crime rates, admirable attractions, excellent healthcare, and a great art, music, and food scene. However, the state also witnesses record-breaking cold temperatures, has a poor public transportation system, high tax rates, and unwelcoming people.
Minnesota first became a part of the United States territory in 1849, and as people kept moving in, it eventually became the 32nd state of the country in May 1858. Ever since, thanks to the local mining industry, Minnesota has experienced multifold growth over the years. Over 800,000 adults in Minnesota are over 65 years and older, making up around 15% of the state’s population. With an already pretty large senior population, the state predicts that within the next 20 years, the population will top 1.3 million. This means that one of five residents will be a senior. Bearing these stats in mind, Minnesota seems like an enticing place for retirees. But, is it?
As with every state, Minnesota has its share of upsides and pitfalls, but when making the decision to retire in a particular state, it all boils down to what you’re looking for. While Minnesota is an overall genuinely nice place to settle down, its freezing cold weather can be a huge turnoff for some. That said, as a retirement consultant, I’m here to lay down the pros and cons of retiring in Minnesota loud and clear so that retirees can make a sound decision for their golden years.
Table of contents
Pros of Retiring in Minnesota
The North Star State is an overall attractive place loaded with the potential to create a home for retirees, and these benefits that Minnesota offers will show you why.
Average Housing Costs
Since the pandemic, the median home value in the United States has gone up considerably, averaging at $374,900 as of the second quarter of 2021. This 16.2% increase has been rather concerning for many retirees seeking to move to another state. Fortunately, Minnesota offers fairly reasonable homes.
Although the median home value in Minnesota was about $225,000, and the increase in property prices around the U.S. has brought it up to $317,303, the housing prices in Minnesota are still much lower than the national average.
If you’re not interested in buying property, you can easily find a nice place to rent out, especially in the larger cities. The average cost of rent in the state is around $1,500 a month, which is affordable for most people. You can also find one-bedroom apartments for as low as $500 per month.
However, these rates usually apply to the state’s more rural areas, such as Hoyt Lakes. Since cities such as Minneapolis and St. Pauls are welcoming more working individuals, especially due to the presence of many Fortune 500 companies, the rental prices in the area have shot up significantly.
So, if you want to retire here, it would be better to opt for the more rural areas for peace, quiet, and overall low housing rates.
Reasonable Cost of Living
A particularly great thing about retiring in Minnesota is the reasonable cost of living. As a retiree, you probably have a fixed income. So, you want to ensure that you utilize it wisely and don’t have to end up spending over your budget. Minnesota delivers effectively in this department!
Sure, the cost of living in urban areas, such as Minneapolis, can be pretty high. However, the expenses incurred by the residents of these cities still aren’t as high as those of those living in New York City or Los Angeles. Also, as you move further towards the rural areas or the less densely populated areas in the state, you’ll experience a greater drop in the cost of living.
First of all, the greatest expense one has to incur is that of the housing prices, so as mentioned before, Minnesota has got you covered in that department. Besides housing, other living costs, such as transportation, groceries, and utilities, run between 2-5% less than the national average.
If there’s one respect the North Star State really shines in, it’s the cost and quality of healthcare. The healthcare costs in Minnesota run almost 20% lower than the national average, but these costs don’t compromise the access and outcomes.
A 2018 study by WalletHub revealed that Minnesota has the fourth-best healthcare in the United States, with about only 10% of its residents having to pay high out-of-pocket medical expenses. This report didn’t come as much of a surprise to many as the Medicare and Medicaid acceptance rates in the state are above 90%, higher than most other states. What’s interesting is that the healthcare situation in the state has only improved over the years.
A 2020 study conducted by the WalletHub comparing the 50 states on the basis of 40 metrics in three main categories: cost, accessibility, and outcome, concluded Minnesota’s standing as the 2nd Best State for Healthcare.
In terms of healthcare costs, including monthly premiums, medical bills, etc., Minnesota ranked 11th. Furthermore, it ranked 8th for access to healthcare, considering factors such as the quality of the public hospital system, response type, and acceptance rates for Medicaid and Medicare. Lastly, Minnesota ranked 8th for healthcare outcomes that consider factors, such as mortality rates, life expectancy, etc.
Plenty of Outdoor Activities
As you can assume by its name, the Land of 10,000 Lakes has more than a few opportunities to explore the glorious outdoors. Minnesota is home to five national parks and 70 state parks and also provides access to the western-most point of the Great Lakes up north from Duluth up to the Canadian border. This area, known as the North Shore, is home to dense ridges and forests, where you have plenty of trails to hike, cycle, or just walk.
You can also experience the Boundary Waters through a boat, canoe, or fishing pole and just padded through the waterways along the Canadian border. Since there are plenty of lakes in the state, boating can become your new hobby!
The wonderful lakes and national and state parks in the state allow for the following outdoor activities:
- Cross-country skiing
- Ice skating
- Trail running
- Rock climbing
- Water skiing
Even if you try a different activity each weekend, it will take years to run out of new things to do in Minnesota.
Rich in Arts
For retirees looking for a touch more sophistication, the art of the state is certainly worth discovering. This is for those who want something more than sporting events or outdoor activities. Minnesota is home to numerous theaters, museums, and art festivals.
Here are a few places to visit and festivals to try:
- Edina Art Fair
- Guthrie Theater
- Minneapolis Sculpture Garden
- Minneapolis Institute of Art
However, unlike outdoor adventures, you must stick to the metropolitan areas in and around the Twin Cities to truly enjoy the art and culture the state offers.
One of the biggest Midwestern traditions in the U.S. is to celebrate anything and everything related to your community’s culture or heritage. Considering this, you will find a ton of festivals to enjoy all year long throughout Minnesota, with The Saint Paul Winter Carnival being the most popular event. You will also want to take your sweet time to truly enjoy the Renaissance Festival and other festivals and events that take place in the smaller towns.
Here are some of the state’s most popular festivals:
- The Ely Winter Festival
- Moose Madness Family Festival in Grand Marais
- Oktoberfest in New Ulm
Great Quality of Life
As I mentioned before, Minnesota has more than a few lakes that are begging to be explored. Besides that, the state also has some impressively rich landscapes, including 90,000 miles of shoreline, trees, fresh air, and access to some of the best hiking trails in the country.
Furthermore, considering the number of outdoor activities you can engage in over here, it can be difficult to ignore the truth that Minnesota offers a fantastic quality of life.
Along with the amazing beauty of the state, you are also likely to come across certain neighborhoods where people might not seem too friendly at first, but once they get to know you, they’ll shovel the snow from your driveway with a second thought. You may even come across people who’ll randomly wave at you or say hello. Either way, all these factors combined make this state worthwhile for retirees.
Diversity makes the quality of life in the state ten-folds better. Minnesota has experienced a lot of immigration over the years, with many of the settlers belonging to European descent and others among the Hmong-Americans, an ethnic group for the northern areas of Laos, China, Vietnam, and Thailand.
Moreover, the Twin Cities are also home to the largest U.S. population of Somali-Americans, native to the Horn of Africa. There’s also a lot of diversity here in terms of the LGBT community, even more than people care to realize.
However, you’ll witness most of this diversity in the urban areas, and even if you don’t, don’t be too surprised since the Minnesotan population is predominantly white.
One of the most interesting things about Minnesota is that its residents get the opportunity to experience all four seasons. Springtime offers a much-needed break from the snowy winters, ultimately transforming the state into a thriving green playground.
The summer season in Minnesota is also nice and pleasant, especially because the temperatures and humidity don’t rise as much as in other parts of the country. Moreover, there’s plenty of daylight during summer, with dusk falling as late as 9 pm or maybe even later.
Autumn is another must-witness season in the state that turns the weather crisp and transforms the color of the leaves to stunning shades of yellow and orange. Winters, although extreme, present the likelihood of a white and jolly Christmas as the snow forms blankets everywhere.
Cons of Retiring in Minnesota
While there are several benefits of retiring in Minnesota, there are some cons that you must consider, too. So, before you get packing to move to the Gopher State, let’s quickly go through the drawbacks of retiring here.
Freezing Cold Winters
As alluring as everything else in the state might seem, its freezing winters can be enough of a deal-breaker for most. The fact is that the winter season in the North Star State can be brutal, even if you’re living in the Twin Cities. Not only do the winters challenge you physically by making it challenging to step out of your home, but they can also be pretty emotionally draining.
The fact that the snowfall in the state, especially the northern part, is measured in feet instead of inches can paint you a clear picture of what I mean by cold. The state does help clean up the snow, but despite the plows running full-time after a snowstorm, it can be 2 to 3 days before you get to leave your home again. Also, the bone-chilling cold seeping in from the arctic can plunge the temperatures to -20°F.
These extreme winter temperatures can be pretty difficult, especially if you’re a senior. So, make sure to do your research on the local weather before stepping foot in Minnesota.
Cold Weather, Colder Attitude
I don’t mean to generalize, but most Minnesotans can’t help but speak their mind. While a part of you would want to appreciate their honesty, the fact is that they are honest to a fault. The conversations you’ll encounter here can be pretty emotionally taxing.
This doesn’t go to say that the people you confront will get violent or abusive; instead, it’s quite the opposite. The behavior they display is termed as the “Minnesota Nice.”
For instance, if someone doesn’t agree with your political views, the outfit you’re wearing, or the new hair color you’re trying, they will make sarcastic remarks or display passive-aggressive behaviors.
The birth of this concept is unique to this state due to the presence of various reserved cultures here whose people tend to avoid confrontation. What’s even more off-putting is that when you offer a similar response to these people, they are likely to feel offended and insulted by your rudeness.
Another important thing to consider is that most locals already have a pretty closely-knit group of friends and family, making it harder for you to make new friends. If you’re a sociable person looking to make new friends during their retirement, Minnesota probably isn’t the best place for you. On the other hand, if you’re okay with keeping to yourself, then you’ll thrive here!
High Tax Rates
While other Midwestern states faced a considerable budget shortfall, Minnesota managed to sustain itself. Why is that so? Three words: HIGH TAX RATES.
Minnesota has quite the high tax rates compared to other U.S. states, which adds to its cost of living. This can be a considerable concern for retirees due to their fixed monthly incomes.
First of all, Minnesota has a progressive tax system, which means that the more you earn, the higher the taxes you’ll have to pay. There are four income tax brackets in Minnesota that start from over 5% and go up to 10% for high earners. The starting percentage of the income tax rate is high enough to begin with, while the latter percentage brings Minnesota’s income taxes to one of the country’s top 5 highest tax rates.
If you’re moving to Minnesota as a fully-retired individual, the income tax rates probably won’t concern you as much as the taxes on retirement incomes. Unfortunately, Minnesota is one of those states that tax Social Security benefits, 401ks, and all other types of retirement income. Therefore, regardless of your age, you shouldn’t expect to receive any tax incentives for living here.
Besides high income and retirement taxes, the sales tax in the state is pretty high, too. Depending on where you live, the sales tax can be between 6.875% and 8.875%, one of the highest rates in the country.
However, only certain items are subject to sales tax. For instance, physical property, such as home appliances, furniture, and motor vehicles, is subject to sales tax, but goods such as groceries, gasoline, medicines, and clothing aren’t. Even some services in the state are heavily taxed.
The state also has estate taxes, but they don’t apply to everyone. There’s a fairly large tax exemption on an estate’s value before any tax is due. To put it simply, the larger your estate, the more sizeable the estate tax your loved ones will have to incur.
If you live in or near Minneapolis or St. Paul, you should be prepared for the heavy traffic you’re going to experience. Sure, the commute may not be as bad as what you’d experience in cities, such as Los Angeles, New York City, or Washington DC, but it is far from being free of congestion.
With the heavy traffic on the main roads, including the I-35, I-394, and I-94, you will be at a stand-still for several minutes. The sad part is that you can’t even avoid the traffic by taking the side streets since they’re usually pretty clogged up too.
You’ll have to plan out your routes carefully when you first move here, especially during the winter months. It’s important to note that traffic is a non-issue for those living in the northern part of the state. So, if a peaceful car ride is what you want, consider moving to Northern Minnesota.
Constant Road Construction
Since Minnesota experiences four distinct seasons throughout the year, there is an increased need to look after its transportation infrastructure. Due to the temperature extremes, the roads expand and contract, causing them to break or suffer damage. This is why road construction is an annual tradition here.
During this time, you’ll witness the traffic cones liberally distributed through the cities to repair cracks, potholes, and other issues. While it’s quite great that the state takes transportation infrastructure repair seriously, the lane closures and detours can pose a massive hassle to many.
Lack of Effective Public Transportation
If you are living in downtown Minneapolis or St. Paul, then you probably won’t experience any problems with the public transportation system – you’ll easily be able to get around the city.
However, if you plan on moving to the suburbs, it’ll be nearly impossible for you and your family to commute around the city without a personal vehicle. Also, even if you get your car, you’ll need to invest in an undercoating for it due to the constant road treatments required to control the icy conditions on the roads.
The Dangers of Minneapolis
Minnesota has an overall low crime rate, but the city of Minneapolis witnesses quite high crime rates, with 1,063 reported incidents for every 100,000 people, almost three times the national average crime rate.
Although many people in the region are employed, the jobs are either part-time or on the lower end of the salary spectrum, which is why almost 1 in 5 households in Minnesota lives in poverty. This adds even further pressure to the safety of the state.
About THE AUTHOR
With multiple family members currently in senior living facilities, David is in the trenches every week, learning the ins and outs of nursing homes, assisted living, memory care, and general senior living.Read more about David Bolton
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