Key takeaways
- Arizona is one of the most popular retirement destinations in the US, with roughly one-fifth of its population 65 or older.
- Warm, dry weather and desert scenery like the Grand Canyon are a big draw, though triple-digit summers aren't for everyone.
- Top retirement spots include Sedona, Scottsdale, and Tucson.
Want to retire in Arizona?
According to data from the U.S. Census Bureau, in 2024, Arizona had a population of approximately 7.6 million people, with more than 19% of the population being over the age of 65, making it a state with a fairly large population of retirees.
Is Arizona a good place to retire?
Yes, Arizona is a good place to retire for many people. It's one of the most iconic US retirement destinations, offering more than 300 days of sunshine a year, dramatic desert scenery including the Grand Canyon, and a lower cost of living than neighboring California. It suits retirees who thrive in dry heat and want an active outdoor lifestyle less than those wary of triple-digit summers or who need easy access to healthcare in every neighborhood.
According to data from the U.S. Census Bureau, Arizona had a population of approximately 7.6 million people in 2024, with more than 19% of residents aged 65 or older, one of the higher shares of retirees per capita in the country.
At what age can you retire in Arizona?
The short answer: any age you'd like. Arizona has no legally mandated retirement age, so you can retire whenever you're financially ready.
- Social Security: You can start benefits at 62, though monthly payments increase the longer you wait. Full retirement age is 66–67, depending on your birth year.
- Medicare: Coverage begins at 65 regardless of retirement status, so you'll need alternative healthcare if you stop working earlier.
- Retirement savings: Most financial experts recommend saving at least 15% of your income for retirement, so it pays to start as early as possible.
What are the pros and cons of retiring in Arizona?
Arizona is a good place to retire for many people drawn to its warm climate and lower costs than California, but it can be a bad place to retire for those who can't handle triple-digit summers or want easier access to healthcare in every corner of the state, so it's worth weighing the pros and cons of retiring in Arizona against your own priorities.
✅ Pros of retiring in Arizona
- Warm climate: Arizona sees more than 300 days of sunshine a year.
- Outdoor activities: Home to numerous national parks, with the Grand Canyon as the crown jewel.
- Cost of living: Generally lower than California's.
- Cultural scene: Numerous museums, galleries, and performing arts venues.
❌ Cons of retiring in Arizona
- Healthcare access: Despite the lower cost of living, some rural areas have limited healthcare access.
- Retirement income taxes: Arizona taxes pensions and other retirement account withdrawals at its flat rate, though Social Security benefits are fully exempt.
- Natural disasters: Arizona is prone to wildfires, dust storms, and flash floods.
Where are the best places to retire in Arizona?
If Arizona is your chosen retirement state, here are some of the best places to retire:
- Sedona: Known for its stunning red rock formations and hiking trails, Sedona offers a peaceful, scenic setting for retirees who enjoy the outdoors.
- Scottsdale: A popular Phoenix-area destination with a warm, sunny climate, numerous golf courses, and a thriving arts scene.
- Tucson: Known for mild winters and a rich cultural heritage, with hiking, golfing, and a vibrant downtown of museums and restaurants.
- Prescott: A small northern Arizona city with a charming downtown, mild climate, and easy access to nature.
- Green Valley: A retirement community south of Tucson with golf courses, fitness centers, and cultural events.
- Sun City: A large Phoenix-area retirement community with golf courses, swimming pools, and community centers.
Taxes in Arizona for Retirees
Arizona is a tax-friendly state for retirees overall. It fully exempts Social Security benefits from state income tax, and its flat 2.5% income tax, the lowest of any state with a flat tax, applies to pensions, 401(k), and IRA withdrawals. Arizona's average effective property tax rate is around 0.48%, among the lowest in the country according to the Tax Foundation, or roughly $1,920 a year on a $400,000 home. Sales tax runs higher, though: the state rate is 5.6%, but combined state and local rates average 8.52%, above the national average.
Retiring in Arizona vs. Nearby States
Arizona holds a clear edge over its neighbors on Social Security and property taxes: it fully exempts Social Security and keeps one of the lowest effective property tax rates in the country. Its neighbors can still come out ahead on income tax, since Nevada charges none at all. Here's how Arizona compares.
Arizona vs. Nevada
Neither taxes Social Security, but Nevada has no income tax at all, beating Arizona's already-low 2.5% flat rate for 401(k) and pension withdrawals. Sales and property tax run about the same in both.
Nevada suits retirees chasing zero income tax; Arizona suits those who want more scenery and cultural variety.
Arizona vs. California
California's top income tax rate of 13.3% dwarfs Arizona's flat 2.5%, though both fully exempt Social Security. Its sales and property taxes run higher too, at 8.99% combined and 0.70% effective versus Arizona's 8.52% and 0.48%.
California suits retirees who want big-city amenities and coastal access; Arizona suits those prioritizing lower taxes and living costs.
Arizona vs. Utah
Both tax pensions and retirement withdrawals, but Utah's flat 4.45% income tax is nearly double Arizona's 2.5%, and Utah also taxes Social Security, though a credit offsets it for lower earners. Property and sales taxes are close between the two.
Utah suits retirees who qualify for its Social Security credit; Arizona suits those who want it exempt regardless of income.
Is Arizona the right place to retire?
Arizona suits retirees who want warm, dry weather, desert scenery, and low taxes on Social Security and property. It's a tougher fit for those who can't handle extreme summer heat or need robust healthcare access in rural areas.
Unbiased can match you with a financial advisor to help you weigh Arizona's tax benefits against its extreme summer heat and rural healthcare access.
Frequently asked questions
Does Arizona tax Social Security?
No. Arizona fully exempts Social Security benefits from state income tax.
At what age can you retire in Arizona?
There's no state-set retirement age. Social Security benefits can start at 62, full benefits arrive at 66–67 depending on birth year, and Medicare eligibility begins at 65.
What's the best place to retire in Arizona?
It depends on your priorities: Sedona for scenery, Scottsdale for golf and culture, Tucson for mild winters and a lower cost of living.
Is Arizona a bad place to retire?
Not for most people. The main drawbacks are extreme summer heat and limited rural healthcare access, but neither outweighs the tax savings and lifestyle for most retirees.
Is Arizona tax-friendly for retirees?
Very. Arizona fully exempts Social Security and has one of the lowest flat income tax rates in the country, though sales tax runs above the national average.