Changes to your next 401(k) statement could be alarming, but don't panic just yet.
Your next 401(k) statement could come with a very worrisome surprise.
Retirement plan holders typically receive quarterly statements in the mail that provide an update on how much they have saved and where their investments are allocated. Starting at the end of June, they'll also be sent a "lifetime income illustration" which shows the monthly income a saver would receive from their current 401(k) savings once they retire.
The change is intended to help employees visualize what the money they save today could mean for them in retirement and encourage them to consider those savings as a future regular paycheck, much like Social Security, instead of a lump sum.
In 2019 Congress passed the SECURE Act to help Americans save by bolstering 401(k) programs — the tax-deferred, employer-sponsored retirement accounts to which employees can contribute pre-tax income, and employers can match some or all of those contributions.
The act included a clause intended to address a growing concern that 401(k) participants are not fully aware of whether their savings will be sufficient to support them in retirement. The clause requires plan administrators to provide illustrations of estimated monthly payments if the current account balance was converted into a lifelong monthly income stream. Earlier this year, the Department of Labor issued guidance on how to implement those changes and said that they must go into effect by the end of June.
The illustrations are intended to change the way people think about their retirement savings, said Chad Parks, founder and CEO of Ubiquity Retirement + Savings. People tend to think about the cash they've stowed away as a lump sum, which can discourage earners with smaller account balances from saving more, he said. Translating the dollars going into 401(k) plans into dollars going out in the future can provide more clarity on how their money would work for them.
The idea works in theory, but the execution could end up spooking potential savers, experts say.
Starting this quarter, plan holders will see two new estimates on their 401(k) statements. Each assumes that they will use their current account balance to purchase an annuity, a retirement vehicle that allows investors to invest a lump sum that will be converted into fixed, lifetime monthly payments.
One estimate on the statement will be for a single life annuity, which pays income to an individual. The other will be for a qualified joint and survivor annuity that pays an income to the annuity owner and their surviving spouse for life.
The illustrations don't account for Social Security or any outside savings, nor do they include any future investment growth or compounding in the market.
Those nearing retirement age will benefit from knowing how much they can expect to live on when they stop working, say experts. But age isn't factored into the equation, so younger workers could see numbers that discourage them from saving more, said Edward Gottfried, director of product management at Betterment at Work.
"It doesn't help you understand what changes if you save more money each pay period," said Gottfried. The actual implementation of the ruling by the Department of Labor, he said, misses the spirit of the law enacted by Congress.
Parks believes that new savers will be encouraged to look into what the numbers they're presented with mean and do their own calculations. But Gottfried said those calculations would "take a high amount of financial literacy and even some actuarial math."
Gottfried, who studies and advises on retirement plans professionally, said it took him a couple of weeks to unpack and figure out what the charts meant. That's a bad sign for the average investor.
A three-legged stool
Ultimately the changes are a move in the right direction and a good first step, Parks said. But there are still huge challenges ahead.
Retirement savings in the United States were long thought of as a three-legged stool. Most American workers had pensions, Social Security benefits and defined contribution plans like the 401(k). Not any more.
Pension plans are nearly extinct. About half of private sector workers were covered by those defined-benefit plans in the mid-1980s, but by 2021 only 15% of private sector workers had them.
Social Security payments still provide about 90% of income for a quarter of older adults, according to SSA surveys. But the Social Security trust fund is facing a 75-year deficit, and without intervention it will be depleted by the mid-2030s. Lawmakers have faced a decades long political stalemate on how to fix it.
What's left is the 401(k), which 68% of private industry workers have access to, but only 50% take advantage of. The SECURE Act is an attempt by Congress to broaden the reach of the 401(k) to make it a better retirement savings vehicle. Whether that effort proves to be successful remains an open question.
Best small towns for retirees in every state
Best small towns for retirees in every state
Many Americans who have bid farewell to the workforce or who are thinking about it are turning to places that offer affordability, a strong economy, quality health care options, less traffic, and overall, more comfort.
A 2025 analysis of Census Bureau data by HireAHelper found that more than 258,000 Americans relocated upon retirement in 2024. Just over 32% of those retirees moved across state lines, roughly double the rate of the typical American mover. Massachusetts and Florida got the lion's share of retiree relocations. However, the report doesn't specify exactly where in these states they headed. It's safe to assume that at least a few settled in retirement-friendly small towns like Sebring, Florida.
With home prices soaring across the country—and many retirees not having enough savings to get through their golden years—small towns can appeal to those who want a slower pace of life and a lower cost of living.
To help prospective retirees, Stacker referenced Niche's 2025 Best Places to Retire study, released in March 2025, to list 50 small towns that offer the best retirement. The focus was on towns with a population of less than 40,000. The national rank included for each place includes all places, not just places under 40,000.
Whether you're looking to relocate or just curious to see if your city of residence is mentioned, read on to see which American small towns are the best retirement spots.
Alabama: Indian Springs Village
- National rank: #191
- Good for retirees grade: A+
- Population: 2,637
South of Birmingham, Alabama, Indian Springs Village maintains a rural environment that is particularly calm and peaceful for retirees. From Oak Mountain State Park to the local garden club, it's clear that town officials' efforts to protect Indian Springs Village from commercialization and maintain a "nature-focused atmosphere" are working.
Alaska: Soldotna
- National rank: #6,405
- Good for retirees grade: B
- Population: 4,448
In Soldotna, Alaska, retirees will hardly feel out of place: 17.3% of residents are over the age of 65. Additionally, the town's position on the Kenai Peninsula means there's a wealth of outdoor activities to keep residents busy.
Arizona: Desert Hills
- National rank: #42
- Good for retirees grade: A+
- Population: 2,910
In Desert Hills, residents don't have to choose mountains over water. The quaint town is nestled in the foothills of three mountain ranges and close to Lake Havasu, a man-made reservoir known for RV recreation and water sports. It's also rated as one of the lowest cost-of-living places in Arizona.
Arkansas: Lake Hamilton
- National rank: #284
- Good for retirees grade: A+
- Population: 1,912
Lake Hamilton is a vibrant place for active retirees who enjoy lakeside living and amenities. It's home to an active fishery and all the seafood restaurants that accompany it, while also being near theme parks for grandchildren's visits. The community also offers independent and assisted living.
California: Del Monte Forest
- National rank: #66
- Good for retirees grade: A+
- Population: 3,576
Despite its rural feel, Del Monte Forest has many options for entertainment, from the famous Pebble Beach Golf Links to restaurants and parks. Located minutes from the city of Monterey, this coastal area is a habitat for numerous rare and endangered plants and animals and a short drive to a nationally recognized independent and assisted living center. The bulk of the population is highly educated and 55+.
Colorado: Columbine Valley
- National rank: #512
- Good for retirees grade: A
- Population: 2,084
Columbine Valley was voted the #1 place to retire in Colorado, perhaps because of its balance of rural and urban amenities. The town is close to Denver but still enjoys a quiet, natural environment complete with views of nearby mountains.
Connecticut: Mystic
- National rank: #210
- Good for retirees grade: A+
- Population: 4,441
Mystic, located along Connecticut's southern coastline between Boston and New York City, is practically overflowing with history, art, and entertainment to keep residents occupied. It has retained much of its original colonial charm, and much of its culture pays homage to its origins as a seaport, including museums, art festivals, and historic landmarks.
Delaware: Rehoboth Beach
- National rank: #29
- Good for retirees grade: A+
- Population: 1,388
North of Ocean City, Delaware, Rehoboth Beach offers a mile-long stretch of beach for residents to enjoy along the Atlantic coast. Through Reach Out Rehoboth, the city makes an effort to listen to citizens' requests and continually improve, including finding solutions for traffic and upgrading stormwater drains.
Florida: Rio
- National rank: #1
- Good for retirees grade: A+
- Population: 1,265
Rio's relatively small scale may attract retirees who want to make the popular jump to Florida but also avoid the hustle and bustle of the larger cities. Most businesses in the town north of Palm Beach, Florida, are privately owned, and with a population of only 1,265, residents won't have to struggle for space at one of the nearby beaches or sand dunes.
Georgia: Avondale Estates
- National rank: #130
- Good for retirees grade: A+
- Population: 3,525
Avondale Estates was ranked the #1 place to retire in Georgia, and it's not hard to see why. Besides peaceful greenery and its close proximity to Atlanta, the quiet town has its own art district and community of artists.
Hawai'i: Wailea
- National rank: #2,823
- Good for retirees grade: A-
- Population: 6,571
Retirees in the resort community of Wailea can truly relax in luxury, as Hawai'i's premier retirement destination boasts upscale restaurants, world-class hotels, and beaches. The Wailea Beach Path winds along the coast, connecting attractions in the area and showcasing ocean views—the route might even inspire some sailing, snorkelling, or scuba diving. It's also a 30-minute drive to the main airport in Maui for interisland and overseas connections.
Idaho: Grangeville
- National rank: #1,307
- Good for retirees grade: A
- Population: 3,443
Grangeville is a laid-back, spread-out community that is ideal for retirees wanting a quieter lifestyle. Homes in the area cost less than the state average, crime rates are low, and the community is tight-knit.
Illinois: Lake Forest
- National rank: #150
- Good for retirees grade: A+
- Population: 19,190
Residents of Lake Forest have convenience and high-quality amenities at their fingertips, making it ideal for retirees—especially the affluent, since the town has a higher-end housing market offset by low property taxes. Location-wise, Lake Forest offers waterside views overlooking the Lake Michigan shoreline, and Chicago is within an hour's drive. The Lake Forest Open Lands Association is also working to ensure access and preservation of the area's natural landscapes for generations to come.
Indiana: Long Beach
- National rank: #425
- Good for retirees grade: A+
- Population: 1,201
The quaint town of Long Beach features a lengthy stretch of Lake Michigan shoreline in a mostly landlocked state. The town was originally established as a summer vacation destination, but has since become a year-round residence with easy access to the Indiana Dunes National Seashore, Chicago, and Michigan City. Like many other retiree havens, Long Beach offers great options for golfers and nature lovers, such as the Friendship Botanic Gardens; it also features numerous noteworthy homes designed by the son of Frank Lloyd Wright.
Iowa: Humboldt
- National rank: #402
- Good for retirees grade: A+
- Population: 4,761
Humboldt takes pride in making sure community members feel welcome, no matter what age. The town, located in central Iowa, has a robust community center, aquatic center, and community garden, offering fitness classes, communal meetups, and special events.
Kansas: Leawood
- National rank: #164
- Good for retirees grade: A+
- Population: 33,844
Nine in ten residents in Leawood own their homes, creating a stable environment for retirees. The town is also known for being family-friendly, offering opportunities for health and fitness, and having excellent safety ratings. It's also the state's top suburb to live in, especially for seniors, with a high ratio of practicing doctors in the area.
Kentucky: Windy Hills
- National rank: #14
- Good for retirees grade: A+
- Population: 2,188
Located a short distance from Louisville, Windy Hills is a city with a wealth of historic homes and public places offering easy access to nature. Moreover, six continuing care retirement homes in the Windy Hills area support members of the suburb's older population.
Louisiana: Oak Hills Place
- National rank: #227
- Good for retirees grade: A+
- Population: 8,380
Oak Hills Place has plenty of green space for residents to enjoy while still remaining close to Baton Rouge's urban hub. Roughly 25% of the town's residents are 65 and older, and locals can benefit from having several parks within 10 minutes or less.
Maine: Camden
- National rank: #245
- Good for retirees grade: A+
- Population: 5,243
Camden has a large retiree population (38% of the town's residents are 65 and older), and the resources they need to live comfortably. Residents of this popular vacation spot can enjoy Camden's perks year-round, including nearby mountains, the Atlantic coastline, and an abundance of shops, restaurants, galleries, and museums.
Maryland: Chevy Chase
- National rank: #52
- Good for retirees grade: A+
- Population: 9,484
For retirees wanting to stay active, the highly walkable Chevy Chase suburb offers many opportunities within the area. Its expansive natural areas are ideal for pedestrians and horseback riders. Chevy Chase has similar benefits to nearby Washington D.C., including cherry blossom trees, a nature sanctuary, high-end stores, and assisted living facilities.
Massachusetts: West Chatham
- National rank: #85
- Good for retirees grade: A+
- Population: 1,337
West Chatham is a popular vacation spot, meaning that retirees can enjoy it year-round. Located along the Cape Cod peninsula, it is home to multiple beaches, sand dunes, ponds, and forests, creating a secluded, rural feel.
Michigan: Village of Grosse Pointe Shores
- National rank: #128
- Good for retirees grade: A+
- Population: 2,589
Grosse Pointe Shores, just north of Detroit, is perhaps best known for its prime location along scenic Lake St. Clair. The town offers support to older citizens at The Helm, a center that provides fitness classes, games, and community events.
Minnesota: Mendota Heights
- National rank: #1,031
- Good for retirees grade: A
- Population: 11,644
Mendota Heights is close to Minneapolis and St. Paul while maintaining a small-town, peaceful atmosphere. For older citizens, the town's Parks and Recreation department offers year-round activities and social events, ensuring life stays engaging.
Mississippi: Ocean Springs
- National rank: #595
- Good for retirees grade: A
- Population: 18,561
In addition to earning the Niche ranking for the best place to retire in Mississippi, Ocean Springs has also been named the top coastal small town by USA Today. Maybe the town's appeal lies in the tranquility of the surrounding water and marshland views, or in its thriving, historic downtown. Or perhaps retirees are drawn to the tax-free incentives for retirement income, offered throughout Mississippi.
Missouri: Oakland
- National rank: #41
- Good for retirees grade: A+
- Population: 1,619
Oakland provides plenty of opportunities for residents to relax and play, including three parks within city limits and a bike trail. With a median rent of $2,063, this area near St. Louis is relatively affordable and has a rural, "small-town" feel.
Montana: Whitefish
- National rank: #2,276
- Good for retirees grade: A-
- Population: 8,422
Retirees with an adventurous spirit will be right at home in Whitefish, a resort town that lies on the edge of Glacier National Park in the Rocky Mountains. The town is well-suited for those who enjoy outdoor activities like mountain biking, hiking, fishing, and skiing, though homes can be on the pricey side. According to Realtor.com, houses sell for a median cost of $800,000.
Nebraska: Auburn
- National rank: #776
- Good for retirees grade: A
- Population: 3,468
The town of Auburn has multiple options for assisted and independent living. But for retirees who want to venture out more, the bustling Kansas City, Omaha, and Lincoln metro areas aren't far. Auburn itself has a disc golf course, a variety of boutique shops, and outdoor recreation along Duck Creek.
Nevada: Kingsbury
- National rank: #133
- Good for retirees grade: A+
- Population: 2,165
Perched above Lake Tahoe in the heart of the Sierra Nevada mountains, Kingsbury is within reach of all of the area's best tourism sites, without the high prices and crowds. Nearby is North America's largest concentration of ski resorts, including Heavenly Ski Resort, as well as lake activities, beaches, and casinos.
New Hampshire: Bethlehem
- National rank: #481
- Good for retirees grade: A
- Population: 2,523
Bethlehem's motto is "Just Be," and retirees who value outdoor adventure and strong community values might want to "just be" there. Though the village is nestled in the White Mountains—just off the Appalachian Trail—the closest regional hospital is only 10 miles away. Bethlehem is ideal for those who want a quiet life, but year-round local events make community connection easy.
New Jersey: Mountainside
- National rank: #83
- Good for retirees grade: A+
- Population: 6,967
Retirees in Mountainside can enjoy a suburban lifestyle surrounded by nature. Seniors are well-supported, with a designated coordinator who links residents to special services such as transportation, meal delivery, or participation in the Mountainside Active Retirees group. The area offers 20 senior living communities, which include assisted and senior living as well as memory care.
New Mexico: Sandia Heights
- National rank: #419
- Good for retirees grade: A+
- Population: 3,083
With a warm, dry climate and an average high temperature of 88 degrees Fahrenheit, Sandia Heights is the perfect locale to bask in the sun. The nearby Sandia Peak Tramway is the longest in the Americas and offers spectacular views of the Sandia Mountains, where residents can also enjoy biking, hiking, and other outdoor recreation.
New York: Lake Success
- National rank: #6
- Good for retirees grade: A+
- Population: 2,817
This Long Island spot enjoys a reasonable cost of living, especially considering it is only a stone's throw from downtown New York City. Lakes cover 43 acres of Lake Success, providing a peaceful, rural haven where residents can spot fish and fowl. No fishing or boating is allowed, further maintaining the quiet atmosphere.
North Carolina: St. James
- National rank: #27
- Good for retirees grade: A+
- Population: 6,901
St. James lies along the Atlantic Intracoastal Waterway, where residents can enjoy kayaking, a marina, walking and biking trails, and pickleball. The city has a resort-like feel and boasts a large pavilion and amphitheater, the setting for several community events.
North Dakota: Valley City
- National rank: #2,758
- Good for retirees grade: A-
- Population: 6,554
Valley City hugs the Sheyenne River and is home to the walkable Highline Bridge, one of the country's highest and longest single-track railroad bridges. The Valley City area has activities for the grandkids, like a waterpark and planetarium, and a brewery and wineries for the older folks. North Dakota is also ranked as the second-best state to age in place by Seniorly.
Ohio: The Village of Indian Hill
- National rank: #251
- Good for retirees grade: A+
- Population: 6,048
Indian Hill's residents have created a "strong sense of history and community" within the town's 20 square miles while still remaining close enough to participate in Cincinnati's urban life. The village includes 75 miles of bridle trails for horseback riding and the Grand Valley Preserve, where residents can catch a glimpse of local wildlife.
Oklahoma: North Enid
- National rank: #499
- Good for retirees grade: A
- Population: 1,167
Retirees looking to save money might want to consider Oklahoma, which a June 2025 study from Visual Capitalist ranked as the second-best state for affordability, with an annual living cost of just $60,000. The area also offers a nursing facility with a good reputation for skilled nursing care, memory care, and rehabilitation. North Enid is also known by residents to have a family-oriented, tight-knit community.
Oregon: Gearhart
- National rank: #788
- Good for retirees grade: A
- Population: 1,959
The small town of Gearhart sits among the dunes near the Pacific Ocean. Seniors who want to stay active have several options: golfing, hiking, and an estuary for birdwatching, not to mention several seafood restaurants. The state of Oregon offers a variety of services for aging populations, including a program for older people who seek independent living but aren't qualified for long-term care benefits through Medicaid.
Pennsylvania: Orwigsburg
- National rank: #189
- Good for retirees grade: A+
- Population: 3,004
Orwigsburg offers a quiet, welcoming, and safe place to live. The area is well-connected by interstate highways, and within city limits, Orwigsburg has a variety of community-organized events and senior services. The town is also home to Geisinger St. Luke's Hospital, an acute-care facility that holds a primary stroke center accreditation.
Rhode Island: Jamestown
- National rank: #578
- Good for retirees grade: A
- Population: 5,545
Located almost entirely on Conanicut Island, the upscale community of Jamestown boasts scenic surroundings with views over Narragansett Bay. Boaters and scuba divers would be at home in Jamestown, and easy access to Providence and Boston connects this small community to city activities and more robust health care. Jamestown's senior services include a senior center and support for housing, transportation, and independent living.
South Carolina: Hilton Head Island
- National rank: #90
- Good for retirees grade: A+
- Population: 37,805
Hilton Head Island is a truly luxurious place to retire. It features 12 miles of beach, iconic golf courses, tennis courts, and an arts center complete with a local symphony. Hilton Head is also home to endangered sea turtles that nest by the ocean, and the weather ranges from 42 to 89 degrees year-round. The housing market is expensive, but the state of South Carolina does not tax Social Security benefits and only partially taxes retirement income.
South Dakota: Milbank
- National rank: #733
- Good for retirees grade: A
- Population: 3,513
Milbank, located in eastern South Dakota, is perfect for those seeking a quiet, simple life post-retirement. With such a small population, the community tends to be tight-knit. There are a variety of parks and green spaces where residents can take part in community clubs and activities, including pickleball, basketball, walking, baseball, and much more.
Tennessee: Lookout Mountain
- National rank: #144
- Good for retirees grade: A+
- Population: 2,112
Lookout Mountain's namesake provides a wealth of natural beauty and activities for local residents, including Ruby Falls, the tallest underground waterfall in the country. Just a few miles away from the big-city amenities of Chattanooga, Tennessee, there are also a variety of hiking routes and biking trails.
Texas: Taylor Lake Village
- National rank: #44
- Good for retirees grade: A+
- Population: 3,678
Near Houston and Galveston Bay, Taylor Lake Village residents pride themselves on their volunteerism and citizenry, perhaps because 96% of the population are homeowners. The town has a staggering 32 senior living communities, and residents can also connect with one another in Taylor Lake Village's many parks and restaurants. Retirees can also keep expenses low, since Texas doesn't charge a state income tax.
Utah: Ivins
- National rank: #1,197
- Good for retirees grade: A
- Population: 9,524
It's hard to beat Ivins's natural beauty. The town is surrounded by the picturesque Red Mountain wilderness and is close to Zion National Park. The town maintains a strong sense of community pride, with two annual Heritage Days celebrating Ivins' history and close-knit relationships between residents.
Vermont: Shelburne
- National rank: #1,679
- Good for retirees grade: A
- Population: 7,807
On the shores of Lake Champlain sits the tranquil town of Shelburne, known for its welcoming community and plentiful outdoor recreation. Shelburne offers all the necessary amenities, including pharmacies and a well-stocked grocery store, along with restaurants and cafes. The town is also home to one of the oldest yacht clubs in the country and the 1,400-acre Shelburne Farms estate and open-air museum.
Virginia: Rockwood
- National rank: #109
- Good for retirees grade: A+
- Population: 8,834
With warm summers, mild winters, and generally low snowfall, Rockwood is a temperate place to live. Activities can continue year-round without getting weathered out. The town is surrounded by the Appalachian Mountains, providing endless opportunities for hiking, fishing, camping, biking, and other outdoor activities.
Washington: Clyde Hill
- National rank: #370
- Good for retirees grade: A+
- Population: 3,104
Clyde Hill boasts an enviable position: Its location provides views of Lake Washington, Mount Rainier, the Olympic Mountains, the Cascade Mountains, and the Seattle skyline, all at once. The town is close to both Seattle and Bellevue, providing urban amenities without sacrificing some truly breathtaking rural sights.
West Virginia: Summersville
- National rank: #199
- Good for retirees grade: A+
- Population: 3,397
Summersville contains West Virginia's largest lake, with 60 miles of shoreline available for swimming, paddleboarding, boating, fishing, and much more. The town is only 22 miles from the famed New River Gorge National Park, providing even more opportunity for residents to whet their outdoor appetites along one of the oldest rivers in North America.
Wisconsin: Elm Grove
- National rank: #209
- Good for retirees grade: A+
- Population: 6,428
Elm Grove, located just west of Milwaukee, has a variety of active community projects to continually ensure the town is comfortable, clean, and entertaining for its residents, 22% of whom are 65 and older. These projects include reopening Underwood Creek and building new, modern apartments at Caroline Heights.
Wyoming: Thermopolis
- National rank: #365
- Good for retirees grade: A+
- Population: 2,716
Thermopolis almost sounds like more of a vacation destination than a hometown. This Wyoming town has a natural hot springs state park, Wind River Canyon, and a historic, bustling downtown, all at residents' fingertips.
Story editing by Cu Fleshman.
Many Americans who have bid farewell to the workforce or are thinking about it are turning to places that offer affordability, a strong economy, quality health care options, less traffic, and overall, more comfort. Neighborhoods outside major cities and metropolitan areas have grown in popularity among retirees, with 26% moving to smaller towns, but the overall number of people moving for retirement is down.
In 2021, American retirement relocations dropped significantly—approximately 43% less than the previous year, its lowest number of retiree relocations in five years. The Economic Research Federal Reserve Bank of St. Louis suggests this was a result of the ongoing COVID-19 pandemic, soaring home prices, and retirees not having enough savings.
In seeking to help prospective retirees, Stacker referenced Niche’s 2021 Best Places to Retire study, released in August 2021, to list 50 small towns that offer the best retirement. The focus was on towns with a population of less than 40,000.
Whether you’re looking to relocate or just curious to see if your city of residence is mentioned, read on to see which American small towns are the best retirement spots.
You may also like: Best counties for retirees in America
