Why This North Carolina City Tops the List for Budget-Friendly Retirement Destinations

When it comes to affordable retirement living in the South, Hickory, North Carolina, checks off many of the important boxes that retirees care about. You may not have heard of this small city with a population of just 43,490, but it has one of the lowest housing costs in the South and favorable tax treatment. 

Located just a short drive from Charlotte, Hickory offers a welcoming, small-town vibe and plenty to do for those seeking an active lifestyle.

Though the median age in Hickory skews young (age 37.9), 16.9% of the population is 65 or older. Plus, as more and more retirement-aged people head south, don’t be surprised if Hickory becomes a popular destination thanks to its unique combination of natural beauty, downtown fun, and budget-friendly living. 

Below-Average Cost of Living

One of the key reasons that Hickory, North Carolina, earned a No. 6 ranking in our “Best Places To Retire in the South” report is its very affordable median monthly housing expenses. Hickory residents pay an average of $960 per month in housing costs, 17% less than the $1,163 average monthly housing costs across the South overall. 

Renters can also find apartments starting as low as $1,000 per month, which is way below the national median of $1,382 (as of December 2024). Even going by Hickory’s median income of $58,251, which is lower than the national average of $77,540, it would only take about 20% of income to cover the lowest rent, leaving some wiggle room in a retiree’s fixed budget.

Why This Is Key to an Affordable Retirement

People in retirement typically have fixed income from a combination of Social Security, pension, or retirement account distributions. Since housing costs are the largest expenditures in one’s budget, requiring about 23% of a retiree’s income on average, the less you pay for housing, the more income you’ll have at your disposal.

Given Hickory’s much lower-than-average median monthly housing costs, whether you own a home or rent, life can be more affordable for those who retire there.

Low Property Taxes

In Catawba County, where Hickory is located, the county tax rate is 0.700%. On a home valued at $285,180 (which is the average price in Hickory), that would be about $1,996 per year.

When coupled with lower overall housing costs, having reasonable property taxes can make living on a retirement income much more manageable.

Why This Is Key to an Affordable Retirement

Property taxes can be a sneaky budget killer, depending on where you live. Even if you have paid off your home mortgage, ongoing property taxes—which tend to increase over time—are still your responsibility. Take, for instance, a state like New Jersey, where the state and local property tax rate of 2.08% ranks highest in the country, and you can see how that can quickly eat away at your income. North Carolina’s tax rate ranks a much more affordable 36th in the nation.

Below-Average Income Tax

North Carolina is one of just 12 states that features a flat individual income tax rate on all income—and it’s just a flat 4.5%. Though it’s not necessarily the lowest income tax out there, especially since a few states do not charge any income tax at all, it’s still an important factor to consider if you’re relocating from a higher-tax state. For reference, states like Minnesota and Oregon have a top tax rate of almost 10%.

In addition, the average combined state and local sales tax rate is 7.0% in North Carolina; the state ranks 27th in the nation. That puts it right about in the middle nationally, but it’s among the best rates in the South. For example, Alabama’s combined rate is 9.29%, while Tennessee’s is 9.55%. 

Why This Is Key to an Affordable Retirement

A flat tax rate offers predictability and can especially work out in your favor if you have a high income in retirement. In other states, you move into a higher tax rate if you earn over a certain income threshold. If you do not make a lot of income in retirement, however, you might have an easier time finding a state where the income tax is lower.

Lower sales tax is another factor that can help your money go further, stretching your dollar when you purchase everything from groceries to gas to household items. While North Carolina may not have the lowest sales tax in the nation, it’s better than many other states. Like other aspects of retirement finances, the best strategy is to look at your current state income tax rate and compare it to what it would be in North Carolina to see if you will come out ahead. 

Other Surprising Perks of Hickory, North Carolina for Retirees

Hickory is one of those places where the mantra “location, location, location” rings true. Situated along the Catawba River and in close proximity to Charlotte, Hickory is a hidden gem surrounded by nature, including scenic views of the Blue Ridge Mountains. In fact, Hickory has been named an All-America City three times, as well as being recognized by National Geographic Travel as one of the Best Small Cities in America. 

Active retirees will enjoy an abundance of parks and trails, including 26 city parks and the Hickory Trail, which offers 10 miles of bicycle and pedestrian pathways. There’s also a vibrant downtown area that features a City Walk with restaurants, retail shops, and entertainment venues. The mild climate, which rarely features extreme hot or cold temperatures, is also attractive to seniors who prefer not shoveling snow.

As for health care, residents have access to Catawba Valley Medical Center, a top-rated hospital, and many other options. 

Bottom Line

For retirees looking to live out their golden years down south, don’t sleep on Hickory, North Carolina. Not only is it among the most affordable options regarding housing costs, but it also has favorable tax treatment, providing more flexibility for your retirement income.

Hickory also happens to offer the perfect blend of small-town living and big-city perks, which makes it truly appealing for many retirees. 

Methodology

The places chosen for 2024 South’s Best Places To Retire list were selected from all Census Designated Places in southern states (Alabama, Arkansas, Florida, Georgia, Kentucky, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, and West Virginia). Median household income and monthly housing cost estimates were collected from the 2022 American Community Survey (5-year) for each place in the South. Places for which estimates included large margins of error were removed from the initial list. 

The final list of places was selected by evaluating: 

1. Housing affordability relative to the South (how each place’s monthly housing costs compare with a weighted average for states in the South);
2. Median income in each place (as a proxy for taxes collected which may be related to community resources; and 
3. Individual reporting on proximity to parks or coastlines, recent changes in the community, and previous reporting highlighting the best places to retire.