Retiring in Delaware: a complete guide
This article will take you through the main things you need to consider if you plan to retire to Delaware.
Delaware is an increasingly popular retirement destination for many Americans seeking a peaceful and relaxed environment.
Delaware had a population of approximately 1 million people, with over 18%| over the age of 65.
Delaware is known for its peaceful and relaxed environment, making it an ideal destination for retirees looking for a slower pace of life.
Delaware’s retirement taxes are relatively low, with no tax on Social Security income, no sales tax, low property taxes, and additional tax deductions available for over 65s.
Retiring in Delaware: pros and cons
Each state has its pros and cons, and when deciding in which state to spend your retirement, it’s important to weigh up your options.
The pros of retiring in Delaware:
Peaceful environment: Delaware is known for its peaceful and relaxed environment, making it an ideal destination for retirees looking for a slower pace of life. The state is also known for its friendly and welcoming communities.
Moderate climate: Delaware's climate is generally mild, with moderate temperatures throughout the year. This makes it an attractive destination for retirees who want to avoid extreme weather conditions.
Outdoor activities: Delaware is home to several state parks, forests, and beaches, providing ample opportunities for outdoor activities such as hiking, fishing, and boating. The state is also known for its golf courses, making it an ideal destination for golf enthusiasts.
Low taxes: Delaware has no sales tax and low property taxes, making it an attractive destination for retirees on a fixed income. You can also check out the complete guide to taxes in Delaware here.
The cons of retiring in Delaware:
Limited healthcare options: While Delaware has several healthcare facilities, the state is known for having limited healthcare options in some areas, which could be a concern for retirees with health issues.
Small size: Delaware is one of the smallest states in the country, which could be a concern for retirees who are looking for a more metropolitan lifestyle.
Natural disasters: While Delaware is not as prone to natural disasters as some other states, it is still susceptible to hurricanes and flooding, which could be a concern for retirees living in certain areas.
Delaware retirement taxes: does Delaware tax retirement income?
If you’re wondering what Delaware taxes for retirees are like, look no further.
Taxes in the state are low compared to the rest of the US. For example, the state has no sales tax and relatively low property taxes.
Delaware’s state income tax is based on seven tax brackets, with the maximum income tax rate standing at 6.60 percent and applying to incomes of more than $60,000. People living in Delaware can also use tax deductions to reduce their taxable income. The Delaware standard deduction amounts to $6,500 for a couple filing jointly or $3,250 for any other filers. Filers over 65 or married to someone who is can claim an additional $2,500 in deductions.
You may also be wondering, does Delaware tax Social Security? Social Security is not taxed as part of a person’s income in Delaware.
You can also check out the complete guide to taxes in Delaware here.
What age can you retire in Delaware?
Like many states, Delaware has no specific retirement age that is mandated by law. This means that individuals are free to retire whenever they choose, as long as they are able to financially support themselves. However, there are some age-related benefits and considerations for retirees in Delaware:
Social Security benefits: The earliest age at which you can begin receiving Social Security benefits is 62, but if you delay taking benefits, your monthly payments will increase. Full retirement age (FRA) is between 66 and 67, depending on your birth year. Delaying benefits until after FRA can result in even higher monthly payments.
Medicare eligibility: Medicare eligibility begins at age 65, regardless of retirement status. However, if you choose to retire before age 65, you will need to find alternative healthcare coverage until you become eligible for Medicare.
Age discrimination: It is illegal for employers to discriminate against employees or job applicants based on age.
Retirement savings: Regardless of retirement age, it is important for individuals to start saving for retirement as early as possible. Many financial experts recommend saving at least 15% of your income for retirement. You could also check out the average retirement savings in the US here.
Where are the best places to retire in Delaware?
If Delaware is your chosen retirement state, here are some of the best places to retire in:
Lewes: Located on the Delaware Bay, Lewes is a charming and historic town with a low cost of living, great healthcare facilities, and plenty of outdoor recreational opportunities. It's home to several beaches, a state park, and a variety of cultural events throughout the year.
Rehoboth Beach: This coastal town is a popular retirement destination for its beautiful beaches, diverse restaurant scene, and vibrant arts community. It offers a mix of historic and modern homes and has a lively boardwalk with shops, restaurants, and amusements.
Bethany Beach: This family-friendly beach town is a quieter alternative to Rehoboth Beach. It has a small-town feel with a tight-knit community and offers plenty of opportunities for fishing, kayaking, and other outdoor activities.
Wilmington: For those looking for a more urban retirement experience, Wilmington offers a variety of cultural attractions, including museums, theaters, and galleries. It also has a diverse restaurant scene and several parks and gardens.
Milford: Located in southern Delaware, Milford is a small town with a low cost of living and a friendly community. It has a historic downtown area with shops and restaurants and is close to several beaches and state parks.
Is Delaware a good place to retire?
Delaware offers a unique retirement experience that attracts many retirees every year. According to data from the U.S. Census Bureau in 2020, Delaware had a population of approximately 1 million people, with over 18% of the population being over the age of 65.
The state is an increasingly popular retirement destination for many Americans seeking a peaceful and relaxed environment with access to outdoor activities, cultural events, and a moderate climate.
Delaware’s mild climate, low taxes and variety of recreational activities offer a lot of retirement benefits. Still, potential retirees should also be prepared for limited healthcare options in some areas of the state.
It's important to seek expert financial advice to weigh up all of the costs associated with retiring in Delaware, including property taxes, insurance, and living expenses. An advisor can review your finances and weigh up all of the costs associated with retiring to Delaware. Find the right advisor for your needs today.
Kate has written for leading publications and blue chip companies over the last 20 years.