Several upstate New York cities are relatively affordable to live in, according to a new analysis from the personal finance site LendingTree, considering Social Security isn’t covering as much spending as it should.
While the Social Security Administration says its benefits are supposed to replace about 40% of the income earned in working years, the funds cover only around 30% of what the average retiree spends in a year in large U.S. cities and their suburbs, according to the LendingTree analysis.
Cities like Buffalo, Syracuse, Albany and Rochester fall right around that number but you’ll need more to retire in cities like New York City and Poughkeepsie, where the amount of spending covered by Social Security falls below 29%.
“Most (retirees) aren’t fortunate enough to have a seven-figure nest egg or a pension to lean on,” says LendingTree chief consumer finance analyst Matt Schulz. “Most people have tight budgets, limited expendable income and low retirement account balances. It’s all going to add up to a challenging situation for retirees and their loved ones in the next 15 to 20 years.”
Here’s what to know.
To retire comfortably in big cities, you need big savings
To live a comfortable retirement in any of those cities, the report says, you’ll need lots of savings: $1.6 million in Los Angeles or San Francisco, $1.3 million in Philadelphia or Chicago, $1.1 million in Memphis, Tennessee.
“Life is expensive in bigger cities in America today,” said Schulz. “Not breaking news, but unfortunately, this is not something that’s going to get better anytime soon. And it makes for a scary situation.”
The analysis used data from the Labor Department, the Social Security Administration and the U.S. Census to estimate annual retiree spending and average Social Security benefits in each large metropolitan area. Among the findings:
The most affordable cities for retirees don’t share much in common, except that they don’t rank among the very largest metros, and they aren’t in California. Relatively affordable cities include Pittsburgh; Tucson, Arizona; and Rochester, N.Y.
“These are very different cities, in all sorts of ways,” Schulz said. “One thing this does show is that the biggest of the big cities are going to be a challenge, in no uncertain terms.”
How far does Social Security go in some New York cities?
Here’s how far Social Security goes in some of New York’s largest metropolitan areas, listed in order of most affordable to least, according to LendingTree’s analysis.
Buffalo: The Queen City has an average Social Security retirement income of $22,581 per year. Retirees spend an average of $55,882 annually. Social Security covers 33.12% of annual retirement spending.
Syracuse: Average Social Security income is $22,581 per year in Syracuse. Retirement spending averages $56,355 and Social Security covers 32.84% of that spending.
Albany: Albany’s average Social Security income is $22,581 per year. Retirees spend an average of $57,776 annually and Social Security covers 32.04% of that spending.
Rochester: The Flower City has an average Social Security retirement income of $22,581 per year. Retirees spend an average of $57,835 annually. Social Security covers 32% of annual retirement spending.
Poughkeepsie: Poughkeepsie’s average Social Security income is $22,581 per year. Retirement spending averages $64,939 and Social Security covers 28.5% of annual retirement spending.
New York City: Average Social Security income is $22,581 per year in the Big Apple. Retirement spending averages $66,597 and Social Security covers 27.8% of that spending.
Emily Barnes reports on consumer-related issues for the USA TODAY Network’s New York Connect Team, focusing on scam and recall-related topics. Follow her on X and Instagram @byemilybarnes. Get in touch at ebarnes@gannett.com.
This article originally appeared on Rochester Democrat and Chronicle: Social Security in New York: Which cities give retirees the most value?
Reporting by Emily Barnes, New York Connect Team / Rochester Democrat and Chronicle
USA TODAY Network via Reuters Connect
