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Yes, Oregon can be a good place to retire. You’ll find plenty of beautiful places to explore, from the coastline to the mountains. The state also doesn’t tax Social Security benefits, which can help stretch your retirement income.
However, Oregon does have a high cost of living, and housing prices are above the national average. Plus, state income taxes on retirement withdrawals can add up.
Whether Oregon is a good place to retire depends on what matters most to you. This means weighing the pros and cons is key to making the right decision.
What You’ll Learn In This Guide
This article displays the latest data and expert insights to help you understand what retirement may look like in Oregon. You will discover:
What are the reasons Oregon draws retirees from across the country?
What are the drawbacks that one should consider when settling in Oregon?
What are the other aspects that one must assess as well before retiring in the state?
Overview
Pros of Retiring in Oregon
There are multiple benefits to settling in Oregon. Here are some of these, explained:
Picturesque Environment & Outdoor Activities
Oregon has parks of all sizes, from tiny Mills End Park in Portland, which is only 452 square inches, to the great Silver Falls State Park, home to a 177-foot waterfall. Beyond Silver Falls, there are other sites to explore for outdoor recreation. One of these is the Crater Lake National Park, where you can witness the deepest lake in America, formed within a volcanic caldera.
The lake's clear blue waters are fed solely by rain and snow, contributing to its pristine condition. Within the lake, Wizard Island, a volcanic cinder cone, rises prominently, offering hiking opportunities for those who reach it via boat tours during the summer months.
In the Hood River Valley, the landscape is characterized by rolling hills adorned with orchards and vineyards. This area, part of the Hood River region, is known for its agricultural richness and scenic beauty. The Hood River Fruit Loop is a popular 35-mile route that takes you through this picturesque countryside, offering stops at various farms and wineries.
Many locations also have ADA-accessible features, like boat launches and viewing platforms. Some of these include:
Parks such as Nehalm Bay and South Beach: Offer accessible restrooms.
Cities such as Lincoln City, Manzanita, and Pacific City: Offer adaptive wheelchair rentals.
Moderate Climate
Oregon’s climate is great if you dislike extreme weather. Summers are dry, and winters are cool with little snow in most areas. If you love sunshine, you might want to retire in Klamath Falls, known as “The City of Sunshine,” where you’ll get almost 300 sunny days a year.
Other sunny spots include:
Burns: Located in eastern Oregon, Burns experiences approximately 214 sunny days annually.
Pendleton: Situated in northeastern Oregon, Pendleton averages about 192 sunny days annually.
Diverse Cultural Scene
From the vineyards of Willamette Valley to the hundreds of food carts in Portland, Oregon is full of cultural experiences. The state is known for its craft beer culture, with breweries serving unique flavors.
There are other activities you can do in the state:
Attend the Oregon Shakespeare Festival: The festival runs from March through October. It presents a diverse lineup of classic and contemporary plays across three venues, including the outdoor Allen Elizabethan Theatre. The festival draws approximately 400,000 attendees annually.
Visit the Oregon Historical Society Museum: It is home to over 85,000 artifacts. One of these is the 1835 Portland Penny, which was used to decide the city's name.
Tax-friendly for Social Security
Living in Oregon means experiencing one big advantage, which is that your Social Security benefits won’t be taxed. This is important, especially if Social Security makes up a large part of your income. Oregon is one of 42 states, plus Washington, D.C., that follow this rule.
What this means for you:
More income stability: This helps with financial planning.
More income for other expenses: Savings can be directed towards other costs such as healthcare and leisure.
Cons of Retiring in Oregon
There are drawbacks to spending your golden years in the state. This list provides a detailed overview of some of them:
High Cost of Living
Although there is no statewide sales tax, retiring in Oregon can be expensive, whether you choose the sunny towns of Southern Oregon or the mountain communities up north. Oregon housing prices have climbed, with the average single-family home costing about 11% more than before the COVID-19 pandemic.
A big reason for this is the state’s housing shortage. Oregon is short of over 120,000 affordable units for low-income households. With limited supply and high demand, home prices have grown. Today, the average home price is over $500,000, which is nearly 25% more than the country’s average. If you plan to retire here, it’s important to budget for higher housing costs.
There are other factors that contribute to the state’s high living expenses, such as:
Groceries: Prices in Oregon are approximately 6% higher than the U.S. average.
Transportation: Transportation costs in Oregon are about 17% higher than the national average.
Income Tax on Retirement Income
While Social Security benefits are exempt from state income tax, other retirement income sources, such as 401(k) and IRA withdrawals, along with most pension payments, are fully taxable at Oregon’s standard income tax rates. These range from 4.75% to 9.9% depending on income level. Retirees with lower incomes may qualify for the Oregon Retirement Income Credit, offering up to $6,250 per person, though eligibility is income-dependent.
This means it’s helpful to:
Review state benefits: Explore eligibility for the Oregon Retirement Income Credit, which can reduce your tax liability.
Consult with a financial professional: Seek personalized advice to develop tax-efficient strategies.
Traffic Congestion
Traffic congestion is part of daily life in Oregon, particularly in cities like Portland and Eugene, where increased population growth has led to longer commute times and crowded roadways. Portland, for instance, ranks among the top ten U.S. cities for worst traffic congestion, with drivers experiencing over six hours of daily congestion on average.
To deal with the traffic, you may need to:
Plan travel during off-peak hours: Schedule errands and appointments during mid-morning or early afternoon to avoid peak traffic times.
Utilize public transportation options: Explore local transit services, which may offer senior discounts and can alleviate the stress of driving in heavy traffic. Portland is also
home to advanced bike infrastructure, a key way to reduce costs if you decide to live there.
Natural Disasters
Oregon faces various natural disasters, including wildfires, floods, and earthquakes. Wildfires are common during hot, dry summers, especially in forested areas. Floods, meanwhile, can happen after heavy rains or snow melts, affecting rivers and low-lying regions.
Earthquakes, particularly from the Cascadia Subduction Zone, pose risks to the West Coast-facing part of the state. Another thing to expect is winter storms. These bring snow and ice, leading to power outages and hazardous roads.
Being prepared for natural disasters in Oregon means:
Checking your car regularly: Engaging in preventive maintenance helps you avoid unwanted mechanical failure in case of emergencies.
Signing up for local emergency alerts: Oregon maintains the OR-Alert system, which provides the local alert system in the county, city, or zip code in your area.
Estate Tax
Oregon is one of only a few states that has its own estate tax. In fact, as of 2024, only 12 states and the District of Columbia impose estate taxes, and Oregon has the lowest exemption threshold among them at $1 million. This means that if your estate is worth more than $1 million, it could be subject to Oregon's estate tax, with rates ranging from 10% to 16% depending on the estate's value.
Managing this may involve:
Reviewing your estate’s total value: Taking stock of your assets is helpful to know whether you exceed the exemption.
Consulting with a legal professional: This allows you to explore financial strategies.
Other Aspects to Consider Before Retiring to Oregon
Moving to Oregon for retirement means assessing additional factors, such as:
Healthcare Costs
It’s crucial to consider expenses related to living with care. Oregon isn’t one of the most expensive states for assisted living, but it’s not the cheapest either. According to the World Population Review, the average cost of assisted living in the state is about $60,540 per year. This means you’ll need to budget carefully if you plan to stay in a senior living facility.
Varied Property Taxes
Although Oregon's property tax rates are generally lower than in other states, rates in Oregon can vary depending on the county, with some areas having higher rates due to local levies and assessments. For example, in Multnomah County, the average effective rate is 0.99%. This is higher than in other counties that offer lower property tax rates, such as coastal Lane County, which has a 0.89% rate.
Diverse Retirement Destinations
Oregon offers a variety of small towns and cities that are great for retirees, each with its own special charm. Bend is known for its vibrant arts scene and outdoor activities, including walking in its hiking trails or skiing in the nearby mountains. Florence, meanwhile, offers a peaceful coastal setting, with beautiful beaches and a friendly community. Another city is Bandon, a coastal town renowned for its cranberry production, earning it the nickname "Cranberry Capital of Oregon."
Final Thoughts: Retiring in Oregon
Settling in Oregon can be a good choice if you enjoy being outside, eating great food, and living in a place with a mild climate. You won’t pay taxes on Social Security, and there are numerous opportunities to explore the state’s culture and history.
But you also have to think about things like natural disasters and taxes on retirement income. Living in Oregon can cost more than some other places as well, especially if you need more help as you get older. But if the good parts sound right for you and you're okay with the costs, Oregon can be a great place to enjoy your golden years.
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Frequently Asked Questions (FAQs)
Does Oregon have beaches?
Yes, Oregon has beaches along its Pacific Ocean coast. They are known for wide sandy shores, sea stacks, and scenic views. Towns like Cannon Beach, Newport, and Bandon offer easy access. People visit for walking, tide pooling, and watching sunsets. The water, though, is too cold for swimming for most people.
Are bugs a problem in Oregon?
Yes, although it depends on where you live. Some, like ants, spiders, and beetles, might enter homes, especially during certain seasons. In some cities, bed bugs have become a bigger problem. Stink bugs and boxelder bugs can also be annoying when they come inside. Keeping homes clean and sealing cracks can help reduce bug visits.
Does Oregon get snow?
Yes, Oregon gets snow, but it depends on where you are. Mountain areas like Crater Lake and Mount Hood get a lot of snow each year. Places like Portland and Salem get some snow, but not very much. The coast usually doesn't get any snow at all. So, if you like snow, head to the mountains.
What natural disasters occur in Oregon?
Oregon experiences wildfires, especially during dry summers. Floods, meanwhile, can happen after heavy rains or rapid snowmelt. The state is also at risk for earthquakes.
Disclaimer
The information provided in this guide is for general informational purposes only and does not constitute legal, financial, or professional advice. While efforts have been made to ensure the accuracy and timeliness of the content, laws, regulations, and local conditions are subject to change without notice. Readers should not act upon this information without seeking appropriate professional counsel, especially in financial and legal matters.
