13 Overpriced Retirement Communities That Will Only Hurt Your Wallet

One of the most important factors to have figured out before retirement is where to live. According to a June 2025 Bankrate study, the average annual cost of homeownership in the U.S. is around $21,400. This includes internet and cable, maintenance, taxes, insurance, your energy bill, and utilities. Thanks to inflation, a competitive housing market, and higher interest rates, many homeowners have learned the hard way how much just a 1% difference in mortgage rate can cost or save you.

Whether you're surviving on a fixed retirement income or have a little more leeway, choosing a retirement community that includes all the basics of independent living — community, meals, and activities — may be a worthwhile investment. With the average cost of healthcare causing many seniors to stress over whether they can afford medical care in the next decade, the retirement community chosen can either ease or increase your burden. As per KFF, the average yearly health insurance premium in 2024 was roughly $8,951 for an individual, and $25,572 for a family, representing an increase of 6% and 7% respectively. The national median cost of an independent community in the U.S., as per A Place for Mom, is $3,145 per month. However, state medians can be as low as $2,250 or as high as $5,650 per month. You'd do well to keep this in mind before settling on an overpriced retirement community. 

As per GoBankingRate's study of the most expensive retirement communities in the U.S., Highland Park, Illinois, fits the bill. Surprisingly, over a quarter of the population is 65 years old and above, in a state where the annual cost of home ownership sits around $65,989 per year. Remember, the average annual cost of homeownership nationwide is $21,400, making it more than three times as expensive to own a home on an annual basis. Comparing the average home value of $713,464 in Highland Park with Redfin's May 2025 median sale price of homes — that's $441,738 — it might be better to consider cheaper, or at least more balanced, housing opportunities elsewhere in Illinois.

As per a Place for Mom, the median monthly cost of independent living in Highland Park, Illinois is $5,935, while the average for the state is $4,394, with a national median of $2.900. Whether you buy a home or live in a community in Highland Park, you'll spend more just on housing than you need to. 

While Florida is a known capital for retirement in the U.S., there are a few Florida cities where buying a home will cost you, and Boca Raton is one of them. Another large population of seniors makes up 25.7% of the community in spite of home prices a little higher than the aforementioned Highland Park. At $734,478, nearing ¾ of a million dollars, it's almost $300,000 above the national median of $441,738. This amounts to an average annual mortgage of $46,391. As per The Mortgage Bankers Association (MBA), the national median mortgage payment as of April 2025 is $2,186, or $26,232 per year. That means you'll pay over $20,000 more on your mortgage per year in Boca Raton than elsewhere. Annual housing costs of $69,451 are over three times the national average of $21,400.

As per the U.S. Bureau of Labor Statistics (BLS), the average annual expenditure on food at home was $6,053, while again, the average cost of healthcare in 2024 was $8,951. As per Move.org, the average cost of utilities is $583 per month or $6,996 per year. In Boca Raton, the annual averages are $5,286 for groceries, $7,615 for healthcare, and $4,084 for utilities. So while the cost of living seems a little lower than national averages, most of those savings are eaten up by the cost of housing. Instead, look for other towns in Florida to retire even without savings. 

With just over 31% of the population of Palm Beach Gardens being 65 years old and above, you would have a lot in the way of community. However, you would have to be prepared to cover an average annual mortgage of $48,837 on a home valued at $773,214. That home will cost you an average of $71,780 per year to take care of. Thanks to the recent movement of young, high-net-worth professionals from even more expensive northeastern regions — many taking advantage of remote work and arriving during the COVID-19 pandemic — a desire for high end amenities and housing has raised the cost of living for everybody. There was also an influx of Floridians who wanted something cheaper than the billionaire-infested Palm Springs, and settled for the cheaper Palm Beachs Gardens just 12 miles away.

Considering how long $250,000 in retirement savings could last in Florida, an average home value that's over ¾ of a million dollars isn't exactly a steal. Maybe cross Palm Beach Gardens off your list of retirement communities, and look into this charming coastal town that feels like a more affordable version of Key West. 

Buying a home in La Quinta, CA in 2024 would have set you back $783,236. Paying for and taking care of that home will cost around $71,896 per year, with an average mortgage of $49,470 annually, or around $4,123 per month. That's a home value over $300,000 above the median $441,738, and more than double the national median mortgage. Groceries, healthcare, and utilities cost $4,816, $6,582, and $4,537 per year respectively, all below national averages for in-house food at $6,053, healthcare at $8,951, and utilities at $6,996 per year. The difference of $1,237 for groceries, $2,369 for healthcare, and $2,459 for utilities adds up to an annual savings on living costs of $6,065 per year.

That said, adding up the difference between these annual costs could in no way make up for the hundreds of thousands of extra dollars spent on housing — both the cost of the home and the maintenance afterward — and turns your perceived gains into just less of an annual loss. But you're still losing. 

If you've done your homework on Arizona, it should come as less of a surprise that Scottsdale, AZ makes this list. After all, it is located in a state where you need at least a million dollars to retire. The cost of living in Scottsdale doesn't do anything to curb the state's reputation with an average 2024 home value of $957,314, and $82,131 per year in expenditures. If you don't like the sound of that, you won't like the sound of an annual average mortgage payment of $60,465 or roughly $5,039 per month. On its own, that flies far beyond the median national mortgage, but it gets really pricey once you factor in the $82,131 per year in homeownership expenses, at around $6,844 per month. That's a total of $11,883 per month, which should demonstrate why you need a million dollars on average to retire in the state.

As with the other cities listed so far, healthcare, groceries, and utilities aren't wildly beyond national averages, but at $6,975, $4,955, and $4,338 respectively, they aren't exactly the cheapest of anywhere either. Living here, particularly if you don't have a million dollars in retirement savings or more, will hurt your wallet. However, if you can afford it, and if you enjoy unparalleled outdoor experiences, this city could be one of the best places to retire. Everything is relative. 

There are reasons why this New Jersey town is one of the most expensive retirement communities in the U.S. Another place with home prices getting dangerously close to a million dollars, Fort Lee will eat up $917,000 worth of retirement savings on average, along with $82,893 in expenses associated with the home. All that averages out to an annual mortgage of $57,922. Although the cost of healthcare is still below the national average, it's still high at $7,382, even counting the free healthcare benefits you get from Medicare.

As per a Place for Mom, independent living in Fort Lee is among the highest in the U.S. at around $6,290 per month. That's just around average for the state, but over $2,000 above the national average and just over $3,000 above the national median. So whether you rent space in an independent living community or buy your own property, be prepared to pay a lot for the privilege. 

There is a large population of seniors on Hilton Head Island, making up just under 40% of the total population. Surprising, because the value of homes in 2024 was about $1,012,359. Taking care of the expenses around that home will take an average $84,494 chunk out of your retirement savings, with an annual average mortgage of $63,942 to boot. That's easily more than double the national median home value. For someone on a fixed income, or who just isn't a millionaire, this may not be the best choice. Especially considering one of the best places to live in South Carolina has a cost of living almost 7% lower than the national average.

A Place for Mom puts the average monthly cost of independent living on Hilton Head Island at $4,583 per month, which is higher than both the state and national averages. It also happens to be above the national median of $3,145 per month. So while you'll do a lot better renting in an independent retirement community than buying a home, you might be better off going north. For instance, this cute town in North Carolina with boardwalks and beaches is one of the best places for retirees. 

Aside from the fact that Hawaii has one of America's worst economies, it also happens to be pretty expensive. Sand and surf, particularly if you're a beach bum, may sound appealing, but the $967,106 value of a home in 2024 may not. That home's expenses will take $89,695 out of your retirement savings every year, and it's one of the reasons why Pearl Harbor is one of the most expensive retirement communities in the U.S.

Factors impacting the cost of living are also high here, which is a major downside to retiring in Hawaii. Everything comes at a higher price point here. Groceries are an average $6,701 to the national average of $6,053. Healthcare is still below the national average of $8,951, but at $7,668, not by much. Be prepared for a major gut punch when it comes to utilities here, where $7,549 is the average in comparison to the national average of $6,996 per year. The average cost of independent living in Pearl City, as per a Place for Mom, is also $6,246 per month, which outpaces the national and state average, and is almost double the national median. 

A 2024 home value of $1,064,304 awaits the brave retiree who ventures into Palm Springs, California. The average expense tied to homeownership here is $89,863 per year. So on top of the cost of homeownership, roughly amounting to $7,488 per month, you can look forward to an annual average mortgage of $67,223, or $5,602 per month. That's $13,090 per month in total housing costs, and should give you an idea of how much income you would need to be considered upper class in California. While groceries, healthcare, and utilities are all within the national average, it's questionable how much you would have left over to pay for any of that after paying for housing.

The same could also be said of independent living opportunities. As per a Place for Mom, the average cost of independent living in Palm Springs is $3,637 per month. Although that's lower than the state average by just under $1,000 per month, you can still do better elsewhere. 

The Los Angeles suburb of Cerritos is considered one of America's most expensive retirement communities largely due to housing. Although just over a quarter of the population identifies as being 65 years old and up, the amount of other seniors to socialize with may not trump the cost of living. The average home value in Cerritos is $1,092,307, with housing expenses averaging more than a lot of people's salary at $92,771. Per year, you're looking at an average mortgage of $68,992, or roughly $5,749 per month. With $2,173 being the national median, you would pay a premium of over $3,000 per month, not including the additional expenses related to housing. Ultimately, the average home in Cerritos will cost you more than double the national median sale price of a home.

Independent living will save you more money, but at the same time, it's also not cheap. As per a Place for Mom, $4,446 per month is the average cost of independent living in Cerritos, which is higher than the national average, as well as the national median. 

The average home value in Seal Beach, California is $1,502,206, with an average annual mortgage of $94,881, or about $7,907 per month. Even just having the retirement savings to purchase the average home in Cerritos wouldn't necessarily mean living there is affordable. For instance, the average expense of a home per year in Cerritos is $117,197, or roughly $9,766 per month. If you can't imagine carrying the total equivalent of $17,673 per month in mortgage and other housing expenses, you probably have no business retiring in Cerritos.

According to a Place for Mom, $4,423 per month is what independent living will cost you in Cerritos. Again, that's higher than the national average and the national median, and that might seem like a steal by comparison to the cost of homeownership. Still, it's over $1,000 above the national median, so this will put an unnecessary hurt on your wallet.  

Retiring in Walnut Creek, California is not going to be cheap, with the average home value also cresting over a million dollars to $1,480,984. Assuming you could make the down payment, you would have to be prepared to carry an average annual mortgage of $93,541, or around $7,795 per month. Every year, on average, you could expect to spend $118,693 on expenses related to your home, roughly $9,891 per month. Considering you may not be able to get a mortgage in the state of California in the next decade, you should think about the value of buying a home here anyway. Independent offers some respite, but not much. As per a Place for Mom, the average cost of independent living in Walnut Creek is $5,278 per month. That's higher than the state and national average, as well as the national median.

In Walnut Creek, essentials get more expensive. Groceries will set you back around $5,373 per year. Utilities cost around $4,346 per year. While both of these costs are below national averages, once you price in the cost of owning a home, any advantages quickly disappear. Healthcare however, is especially steep. While it's not getting any cheaper for seniors to access healthcare with a national average of $8,951 in 2024, the cost of healthcare in Walnut Creek, at $9,131, is among the most expensive in the U.S. Here's why you should retire in Claremont if you're set on California living. 

Finally, Rancho Palos Verdes, California, boasts an average home value of $1,995,454, or just shy of $2 million. As you can imagine, that equates to a heavy annual mortgage, in this case averaging around $126,036. There aren't a lot of retirees who could envision spending $10,503 per month on housing, much less the expense tied to owning that home. In the case of Rancho Palos Verde, that expense is the average equivalent $149,970 per year. As should be evident by this point, California isn't exactly one of the cheapest states to retire in the U.S., but even for California residents, this is on the high end.

Independent living, as per a Place for Mom, lands at around $4,772 per month, or $57,264 per year. If you don't mind sacrificing equity, this would obviously be the better option since the total average annual cost of owning a home in Rancho Palos Verdes — adding up the $126,036 mortgage with $149,970 in housing expenses — would be $276,006 per year. The idea of 'better' is relative though, and relatively speaking, the cost of independent living is higher than the state and national average, and again, higher than the national median too.