As military personnel retire, whether they faced active combat or not, they may find it difficult to readjust to civilian life. For example, the U.S. is still dealing with the COVID-19 pandemic, which has killed more people than the Civil War did. Thankfully, things are starting to get closer to normality due to the distribution of vaccines, and states have been able to remove most restrictions.
Even without a pandemic, retirement from the military is always difficult, with many retirees facing major struggles including posttraumatic stress disorder, disability and homelessness. These veterans must also consider how state tax policies on military benefits vary, along with the relative friendliness of different job markets and other socioeconomic factors, when choosing a state in which to settle down.
In order to help ease the burden on our nation’s military community, WalletHub compared the 50 states and the District of Columbia based on their ability to provide a comfortable military retirement. Our analysis uses a data set of 29 key metrics, ranging from veterans per capita to number of VA health facilities to job opportunities for veterans.
|Overall Rank||State||Total Score||Economic Environment||Quality of Life||Health Care|
|49||District of Columbia||41.26||38||49||41|
Note: With the exception of “Total Score,” all of the columns in the table above depict the relative rank of that state, where a rank of 1 represents the best conditions for that metric category.
- 1. Alaska
- 2. Montana
- 3. Virginia
- 4. Maine
- 5. Wyoming
- 47. California
- 48. Utah
- 49. District of Columbia
- 50. New Jersey
- 51. New York
- 1. New York
- 2. California
- 3. Wyoming
- 4. Montana
- 5. Texas
- 47. Washington
- 48. South Carolina
- 49. District of Columbia
- 50. Delaware
- 51. Rhode Island
Members of the armed forces deserve a comfortable retirement in exchange for their brave sacrifices. But it’s not easy to readjust to civilian life. For insight and advice on overcoming challenges faced by veteran retirees, we asked a panel of experts to share their thoughts on the following key questions:
- Should veterans have to pay taxes on retirement pay?
- What should veterans consider in choosing where to retire?
- What are the best economic opportunities for retired military personnel looking for a new career?
- How can the VA healthcare system be improved to better serve veterans and their families?
- How should the government help the military community?
In order to determine the best and worst states for military retirement, WalletHub compared the 50 states and the District of Columbia across three key dimensions: 1) Economic Environment, 2) Quality of Life and 3) Health Care.
We evaluated those dimensions using 29 relevant metrics, which are listed below with their corresponding weights. Each metric was graded on a 100-point scale, with a score of 100 representing the most favorable conditions for military retirees. For metrics marked with an asterisk (*), we measured the “number of veterans” by the square root of the veteran population in order to avoid overcompensating for small differences among states, considering Veterans Administration (VA) facilities have not increased proportionally with the number of veterans.
We then determined each state and the District’s weighted average across all metrics to calculate its overall score and used the resulting scores to rank-order our sample.
Economic Environment – Total Points: 33.33
- State Tax on Military Pension: Quadruple Weight (~6.35 Points)
- Tax-Friendliness: Double Weight (~3.17 Points)
Note: This metric is based on WalletHub’s “Tax Rates by State” report.
- Share of Veteran-Owned Businesses: Full Weight (~1.59 Points)
- Dollars in Defense Department Contracts per Capita: Full Weight (~1.59 Points)
- Job Opportunities for Veterans: Triple Weight (~4.76 Points)
- State Authorization for Veterans’ Preference in Private Hiring: Full Weight (~1.59 Points)
Note: This binary metric considers the presence or absence of a state statute authorizing private employers to implement a veteran-employment preference without vulnerability to claims of discrimination.
- Job Growth (2021 vs. 2020): Double Weight (~3.17 Points)
- Military Bases & Installations per 100,000 Veterans: Full Weight (~1.59 Points)
- Total VA Expenditure per Number of Veterans: Full Weight (~1.59 Points)
- Presence of State Help for Returning Veterans: Full Weight (~1.59 Points)
Note: This binary metric considers the presence or absence of veteran transition programs & commissions in a state.
- Presence of Academic Credit for Military Service: Full Weight (~1.59 Points)
Note: This binary metric considers the presence or absence of state legislation recognizing the varied skills and knowledge veterans acquire by counting it toward college credit.
- Housing Affordability: Double Weight (~3.17 Points)
- Cost-of-Living Index: Full Weight (~1.59 Points)
Quality of Life – Total Points: 33.33
- Share of Veterans: Full Weight (~3.17 Points)
- Share of Veterans Not Receiving SNAP: Full Weight (~3.17 Points)
- Share of VA Benefits-Administration Facilities per Number of Veterans*: Double Weight (~6.35 Points)
- Quality of Public University System: Full Weight (~3.17 Points)
Note: This metric is based on WalletHub “College & University Rankings.”
- Arts, Entertainment & Recreation Establishments per Capita: Half Weight (~1.59 Points)
- Share of Population Aged 40 & Older: Full Weight (~3.17 Points)
- Share of Homeless Veterans: Double Weight (~6.35 Points)
- Idealness of Weather: Double Weight (~6.35 Points)
Note: This metric is based on WalletHub’s “Cities with the Best & Worst Weather” ranking.
Health Care – Total Points: 33.33
- Number of VA Health Facilities per Number of Veterans*: Full Weight (~3.03 Points)
- Federal, State, Local & Private Hospitals per Capita: Full Weight (~3.03 Points)
- Quality of VA Hospitals: Triple Weight (~9.09 Points)
Note: This metric includes VA hospital performance star rating from the U.S. Department of Veterans Affairs’ “Strategic Analytics for Improvement and Learning” (SAIL) performance improvement tool.
- Physicians per Capita: Full Weight (~3.03 Points)
- Mental Health Counselors per Capita: Full Weight (~3.03 Points)
- Veteran Suicide Rate: Full Weight (~3.03 Points)
- Presence of Veteran-Treatment Courts: Full Weight (~3.03 Points)
Note: This binary metric considers the presence or absence of veteran-treatment courts, programs that provide treatment and mentoring services to veterans with mental-health and substance-abuse problems in order to keep them out of the criminal justice system and help stabilize their lives.
- Percentage of Residents 12+ Who Are Fully Vaccinated: Double Weight (~6.06 Points)
Sources: Data used to create this ranking were collected from the U.S. Census Bureau, Bureau of Labor Statistics, Military Officers Association of America, Military OneSource, USAspending.gov, U.S. Department of Veterans Affairs, National Conference of State Legislatures, Center on Budget and Policy Priorities, Council for Community and Economic Research, U.S. Department of Housing and Urban Development, Centers for Disease Control and Prevention, Indeed and WalletHub research.