How Much You Need to Retire Comfortably With a Paid-Off Home in Every State

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A single retiree who owns a home outright needs about $693,000 in savings, on average, to retire comfortably in the U.S., and a mortgage-free couple needs about $870,000. The state you live in moves those figures a lot. For singles, the estimates run from about $572,000 in Arkansas to about $909,000 in New Jersey. For couples, they run from about $700,000 to $1.18 million.

These are modeled averages. Each combines the state’s cost of a comfortable retirement with the national average Social Security benefit and converts the remaining gap into a nest egg using the 4% withdrawal rule. Your own taxes, home maintenance, health costs and spending habits can push your number above or below the state figure.

How Mortgage-Free Retirees Need Less Saved

Housing is the main reason a paid-off home changes the target so much. Census data puts median monthly housing costs at $658 for households headed by someone 65 or older who own without a mortgage, compared with $1,736 for owners in that age group who still carry one. That is a difference of $1,078 a month, or about $12,900 a year.

Under the 4% rule, every dollar of yearly spending funded from savings requires $25 in the portfolio, so an extra $12,900 a year of housing cost adds roughly $323,000 to a savings target. That is a rough illustration of the medians, not an estimate for any particular household.

Owning outright is still the norm among older Americans. Almost 80% of households headed by someone 65 or older own their home, and close to two-thirds of those own it free and clear.

How the Estimate Is Built

The calculation has three steps:

1. Estimate a comfortable year of retirement in the state. This covers everyday living costs plus the housing costs that mortgage-free owners 65 and older actually pay there: property taxes, homeowners insurance, utilities and fees.
2. Subtract Social Security. The model uses the national average annual benefit: $23,704 for a single retiree and $37,713 for a couple.
3. Convert the shortfall into a nest egg. The remaining annual gap is divided by 0.04 (the same as multiplying by 25), following the 4% rule.

In formula form:

Nest egg = (annual comfortable spending − annual Social Security) ÷ 0.04

Running the model backward shows the spending it implies. At 4%, a $693,000 nest egg supports $27,720 a year; adding $23,704 of Social Security implies a comfortable single budget of about $51,400. For a couple, $870,000 supports $34,800, and adding $37,713 implies about $72,500. These are approximations from rounded averages, not separate published figures.

The same arithmetic shows how sensitive the result is to your own inputs:

• Social Security. Each $1,000 a year of benefit above the national average lowers the nest egg you need by $25,000. Each $1,000 below it raises the target by the same amount.
• Housing costs. Each $100 a month of property tax, insurance or utilities adds $1,200 a year, or $30,000 to the target.
• Spending. A budget $5,000 a year leaner than the state’s comfortable level cuts the target by $125,000.

Hypothetical example: a single retiree expects to spend $55,000 a year and collect $26,000 in Social Security. The gap is $29,000. Divided by 0.04, that requires a $725,000 nest egg. If the retiree instead claims early and receives $21,000, the gap widens to $34,000 and the target rises to $850,000.

The 4% rule comes from William Bengen’s 1990s research on how much retirees could withdraw in the first year, then raise each year with inflation, without exhausting a stock and bond portfolio over historical 30-year periods. It is a planning guideline, not a guarantee. A retirement longer than 30 years, a weak market early in retirement or a more conservative portfolio can argue for a lower withdrawal rate and therefore a bigger nest egg.

Where a Paid-Off Home Stretches Savings Furthest

The least expensive states for a mortgage-free single retiree are concentrated in the South and the Plains. Arkansas has the lowest estimate, at about $572,000. Louisiana, North Dakota, Mississippi and Tennessee follow, each below $590,000 and more than $100,000 under the national figure of about $693,000.

Couples need larger nest eggs, but the states that are cheapest for singles also sit near the low end for couples. The couple range is wider in dollar terms because a couple’s living costs grow by more than the extra Social Security income they bring in.

A low state figure reflects lower everyday costs and lower ongoing housing bills. It does not account for other factors that shape a move, such as distance from family, access to health care, or state income tax on retirement income.

The Costs That Outlive Your Mortgage

A paid-off home removes principal and interest, but several bills keep arriving for as long as you own the property:

• Property taxes. These are set locally and usually rise with assessed values. Some states and counties offer senior exemptions, assessment freezes or deferral programs, so a specific retiree’s bill can differ from the state average.
• Homeowners insurance. Without a lender, insurance is no longer required, but going without it leaves the home, often a retiree’s largest asset, exposed to a total loss.
• Utilities and fees. Heating, cooling, water, power and homeowners association or condo fees continue whether or not the loan is paid off.
• Maintenance and repairs. These come in irregular, large amounts. A roof, furnace or foundation repair can cost more than a year of the other bills combined, and older homes tend to need more of them.

Census figures put the combined monthly cost of property taxes, insurance, utilities and fees for mortgage-free owners 65 and older at about $398 in West Virginia and just over $1,200 in New Jersey. That gap of roughly $800 a month, or about $9,600 a year, works out to around $240,000 of nest egg under the 4% rule, before any difference in other living costs.

Those ongoing costs help explain why the Northeast dominates the expensive end. For a single mortgage-free retiree, the highest estimates are:

• New Jersey: about $909,000
• New York: about $840,000
• Washington, D.C.: about $834,000
• Massachusetts: about $826,000
• Connecticut: about $819,000
• New Hampshire: about $814,000

Why These Figures Are Lower Than Survey Targets

In Northwestern Mutual’s 2026 Planning & Progress Study, Americans said they believe they would need $1.46 million to retire comfortably. That is well above every single-retiree state estimate here and above the couple figure in every state.

The two numbers measure different things. The survey figure is what respondents think they will need, whatever their housing situation. The state estimates are built from modeled expenses for retirees who already own their homes outright, net of Social Security. A person still paying a mortgage, or renting, faces higher housing costs and a higher target than the mortgage-free figures suggest.

Retiring Mortgage-Free Is Becoming Less Common

The assumption behind these estimates, that the house is paid off by retirement, fits fewer people than it once did. In 1980, just 13% of homeowners 65 and older still had a mortgage, according to Census data. By 2024, that share had risen to 36%.

The balances have grown as well. Federal Reserve data shows the typical mortgage debt held by owners ages 65 to 79 rose from $21,000 in 1989 to $110,000 in 2022 in inflation-adjusted terms, more than five times as much.

For someone approaching retirement with a mortgage, the choice is between paying it down before leaving work and carrying it into retirement. Carrying it makes the payment part of the spending gap the portfolio must cover: a $1,000 monthly payment adds $12,000 a year and $300,000 to the nest egg target for as long as the loan lasts. Paying it off with retirement funds avoids that, but withdrawals from tax-deferred accounts can trigger income tax, so the source of the money matters.

What the Estimates Leave Out

A few modeling choices are worth keeping in mind when you compare your situation with a state figure:

• Home equity is excluded. The nest egg counts financial assets only. A paid-off home has value the model ignores: you could downsize, sell and rent, or use a reverse mortgage. Each could reduce the savings you need, but each has costs and trade-offs of its own.
• Social Security is a national average. Your benefit depends on your earnings record and the age you claim.
• Taxes are not personalized. Income tax on withdrawals depends on your account types, your state and your other income. Money in tax-deferred accounts is worth less after tax than the same balance in a Roth or taxable account with low gains.
• Housing data covers mortgage-free owners only. It is not a blend of owners and renters. A renter in the same state would typically face a higher housing line.

Other income works the same way Social Security does. A pension, annuity, part-time work or rental income lowers the target by $25,000 for each $1,000 a year of reliable income.

To estimate your own number:

1. Start with your expected annual spending in retirement, including property tax, insurance, utilities, fees and an allowance for repairs.
2. Subtract the Social Security benefit you expect at your planned claiming age, plus any pension or other steady income.
3. Divide the result by 0.04, or by a smaller rate such as 0.035 if you want more margin for a long retirement.

Compare your result with your state’s estimate. A much higher figure usually traces to a lower benefit, higher housing bills or a fuller budget.

The Bottom Line

These estimates fit retirees who expect to own their homes outright, and they shift with your benefit, housing bills and budget. Anyone still paying a mortgage or renting should expect a higher target, since each $1,000 monthly payment adds about $300,000 under the 4% rule. Running your own spending, income and withdrawal rate through the same formula gives a more reliable number than any state average.