This Sunny California Metropolis Was Ranked a Most Costly Place To Retire. Right here’s What You Ought to Know

San Diego, Calif., has a well-deserved fame as probably the most fascinating retirement locations in the USA. Sadly, it’s also among the many nation’s most costly locations to retire, in line with new analysis from Journey + Leisure and Investopedia.

We examined property costs, state and native taxes, and the general price of dwelling—in addition to the numerous components that make San Diego interesting regardless of the large price ticket.

Understanding the Prices of Retiring in San Diego

Total Value of Residing

San Diego isn’t low cost. The web site Payscale pegs the price of dwelling there as 44% increased than the nationwide common. Breaking that down, the location discovered that housing prices had been 115% increased, transportation prices 35% increased, utilities prices 20% increased, and grocery prices 14% increased.

In keeping with the Financial Coverage Institute’s Household Price range Calculator (which takes into consideration housing, meals, transportation, well being care, taxes, and different requirements), a family with two adults and no kids dwelling in San Diego County would spend $86,243 a 12 months, on common.

That’s excessive even for a retirement haven. The comparable determine for Beaufort County, S.C., residence to Hilton Head Island, is $74,229. For Maricopa County, Ariz., which incorporates Phoenix and Scottsdale, it’s $68,525.

Property Costs

The excessive price of retiring to San Diego County begins with the worth of admission: residence costs. In keeping with Census Bureau information, the median residence worth in San Diego was just lately $791,600.

That compares with the nationwide median residence worth of $403,700, as of Might 2025, in line with the Nationwide Affiliation of Realtors.

A search of Realtor.com confirmed many properties within the $1 million-plus class, fairly a couple of with $2 million and $3 million asking costs. Coastal properties are significantly fascinating and, given that there’s solely a lot shoreline, are sometimes in restricted provide.

In different phrases, property costs alone can put the realm out of attain for a lot of retirees. 

Even for retirees who can scrape up the money, devoting too giant a portion of their funds to housing can imply forgoing different pleasures, equivalent to journey or eating out. In reality, housing accounts for practically 38% of San Diegans’ annual spending, in contrast with a nationwide common of simply over 33%.

Native Taxes

California is called a high-tax state, and San Diego isn’t any exception. Whereas not particular to retirees, the Financial Coverage Institute’s Household Price range Calculator estimates {that a} family with two adults and no kids in San Diego County can anticipate to pay a mean of $1,055 a month in taxes. These taxes take quite a lot of kinds.

Gross sales taxes: California has the best state gross sales tax within the U.S., at 7.25%, in line with the Tax Basis. San Diego County provides one other 0.5% to that, for a mixed complete of seven.75%.

Counterbalancing that considerably, California exempts most of the objects which might be more likely to be on retirees’ procuring lists, together with pharmaceuticals and most meals merchandise, aside from heated ready meals.

Earnings taxes: California has a progressive revenue tax, with marginal tax charges starting from 1% to 12.3%. A married couple whose revenue was between $80,490 and $111,732, for instance, would pay a high charge of 6%.

Property taxes: California really has comparatively low property tax charges, due partly to the restrictions imposed by the passage of Proposition 13 in 1978. In keeping with the Tax Basis, residents pay a mean efficient charge of 0.68%. Nevertheless, due to the excessive native housing values, that may nonetheless add up. In 2022, San Diegans paid median property taxes of $5,214.

Property taxes: Additionally on the plus facet, California doesn’t have both an property tax or an inheritance tax, which could be a concern for wealthier retirees.

Well being Care Prices

San Diego has plentiful and high-quality well being care. For instance, the Medicare.gov web site lists 18 hospitals inside a 25-mile radius, many with coveted four- or five-star high quality rankings.

Well being care prices in San Diego are typically no increased and, in some instances, decrease than these in lots of different elements of the nation. Whereas its figures don’t focus particularly on retirees, the U.S. Bureau of Labor Statistics discovered that in 2022-2023, San Diegans had common well being care bills of $5,514 a 12 months, in contrast with a nationwide common of $6,042. In Denver, for instance, the comparable determine was $7,118, and in Phoenix, $7,550.

What Makes San Diego So Costly?

Fascinating Coastal Location

The southernmost main metropolis on California’s Pacific coast, San Diego gives agreeable climate year-round. The county’s 70 miles of shoreline are dotted with an array of public seashores for swimming, browsing, and fundamental lounging.

For retirees on the go, San Diego additionally has a global airport and two downtown cruise ship terminals serving 10 main cruise traces. The Mexican border metropolis of Tijuana is about half-hour away by automotive.

Sturdy Native Economic system

San Diego has a strong, well-diversified economic system with main sectors together with aerospace, protection, life sciences, manufacturing, and tourism. The county can be residence to 2 dozen universities, faculties, and group faculties.

These employers draw a well-educated workforce, with salaries to match. The typical family revenue in San Diego was $122,832 in 2022-2023, in line with the Bureau of Labor Statistics, in contrast with the nationwide common of $97,911. That accounts, partly, for increased native costs.          

Restricted Housing Provide

The housing market in San Diego ranks as “very aggressive,” in line with the actual property web site Redfin. That demand is pushed by common full-time residents and second-home house owners, together with retirees.

One other issue is native zoning insurance policies. Whereas not unusual in California or a lot of the U.S., San Diego’s zoning insurance policies closely favor single-family properties over multi-family items. A 2022 report from the Othering & Belonging Institute on the College of California, Berkeley, concluded that, “the San Diego area’s residential areas are dominated by single-family-only zoning, stifling the event of denser housing choices, perpetuating racial and financial exclusion, and shaping entry to alternative for thousands and thousands of Californians.”

Retirement Concerns in San Diego

So, to sum up among the main execs and cons of retiring to San Diego:

Execs: Stunning Local weather and High-Tier Providers

San Diego’s local weather is probably going a major attraction for retirees who wish to get out and about. Because the Nationwide Climate Service explains, “The prevailing winds and climate are tempered by the Pacific Ocean, with the outcome that summers are cool and winters heat as compared with different locations alongside the identical normal latitude.” Which means lively retirees can benefit from the space’s many seashores, parks, and different out of doors points of interest for a lot of the 12 months.

San Diego additionally has many extremely rated hospitals and well being care amenities, in addition to being well-situated for retirees who like to leap on a airplane or cruise ship when the temper hits. Public transportation is restricted, so residents are more likely to need a automotive, however downtown San Diego and its coastal neighborhoods are pedestrian-friendly. 

Cons: Excessive Housing and On a regular basis Prices

The key draw back to a San Diego retirement, as we’ve indicated, is the price of dwelling. That’s pushed primarily by housing costs, which aren’t solely considerably increased than the nationwide common but in addition increased than many comparable retirement hotspots.

Different, on a regular basis prices, equivalent to groceries and utilities, may also drive up the invoice. So will state and native gross sales and revenue taxes. Particularly, anybody whose prime sources of retirement revenue are more likely to be pensions and IRAs, somewhat than Social Safety, would possibly need to look right into a state that doesn’t tax them.  

The Backside Line

San Diego’s appreciable charms come at a worth. Potential retirees ought to take into account how a lot of a premium they’re keen to pay for the realm’s congenial climate, leisure alternatives, and top-flight well being care, amongst different pluses. By evaluating San Diego with different appropriate retirement locations, they will resolve whether or not the excessive price ticket is value it. Many could resolve that it’s.