Annuities

Smart retirees know location matters. From tax benefits to living costs, where you retire plays a huge role in how far your retirement dollars go.

Some states are creating the perfect storm of annuity-friendly perks, while others are adding friction with high taxes and volatile costs of living.

Let’s dive into the top states where retirees are winning with annuities—and what you should consider before making a move.

🔍Why Annuities Work Better in Certain States

Annuities are portable—but that doesn’t mean every state treats them the same. Key factors that impact how your annuity performs:

• State income tax on retirement income
• Cost of living (think healthcare, housing, groceries)
• Annuity regulation and consumer protections
• Access to financial professionals who understand fixed indexed annuities and income planning

🏆 1. Florida: The Retirement King Still Reigns

Florida has been a retirement magnet for decades, but it’s also a top state for annuity optimization.

Why retirees love it:

• No state income tax
• Large community of licensed annuity agents
• Strong legal protections for annuities and life insurance

🌴 Pro Tip: Retirees in Florida are using multi-year guaranteed annuities (MYGAs) to lock in high interest rates now.

🏔 2. Texas: Tax-Friendly + Annuity-Friendly

Texas is climbing the ranks for retirement planning because:

• No state tax on annuity payouts
• Low regulation means fast access to competitive annuity products
• Popular for premium financing strategies among high-net-worth retirees

🤠 Local Insight: Many Texans are blending IRA rollovers with annuities to control their required minimum distributions (RMDs).

🌲 3. Washington: Underrated but Powerful

Washington surprises many retirees, but it’s becoming a haven for tech retirees and pensioners who want:

• No state income tax
• Access to annuity-friendly wealth advisors
• Consumer protections on deferred annuities

🧠 Planning Note: Great option if you’re looking to defer income past 70 and optimize for future payouts.

🏜 4. Arizona: Sun + Secure Income

Arizona retirees are flocking to fixed annuities to beat inflation without risking their nest egg.

Why it’s a top state:

• Low income tax on annuities
• Strong demand is bringing new annuity carriers into the state
• Healthcare costs are lower than the national average

☀️ Did You Know? Arizona retirees are increasingly using income riders to turn their annuities into monthly retirement paychecks.

⛰ 5. Tennessee: Quietly Becoming a Retirement Gem

Tennessee doesn’t get the flashy headlines, but for retirees focused on maximizing every dollar, it’s golden.

• No income tax on annuity payments
• Low cost of living = lower income needs = lower withdrawal rates
• Growing financial services sector with annuities front and center

🎸 Bonus: Retirees here often pair annuities with long-term care insurance to protect their income and health.

📍 Honorable Mentions for Annuity-Friendly States

• Nevada: Wealth protection and zero income tax
• South Dakota: Great for legacy planning and estate protection
• North Carolina: Growing popularity of annuities among early retirees
• Delaware: Flexible tax laws, especially attractive to HNW individuals

📉 States Where Retirees Might Pay More

Not every state plays nice with annuity income:

• California: High income taxes and limited annuity product availability
• New York: Complex annuity approval process slows access to newer products
• Minnesota: Hefty taxes on retirement income, including annuities

💡 Planning Tip: If you live in one of these states, consider strategic relocation or leveraging non-qualified annuities outside of retirement accounts for tax-deferred growth.

✅ Final Thought: The Right State + The Right Annuity = Smart Retirement Strategy

Location can dramatically impact how well your annuity performs. Savvy retirees are optimizing not just the product—but also the place.

🏠 Thinking about retiring soon?
Let’s talk about your best options—wherever you are.
👉 Schedule your free call with The Policy Shop to explore state-specific annuity strategies.