How Much You’ll Need to Retire Comfortably in New Jersey: Retirement may feel like a lifetime away for some, and a looming question mark for others. But no matter where you are in your journey, one thing’s for sure—retiring comfortably in New Jersey isn’t cheap. According to the latest data, you’ll need a cool $1.57 million to do it right. Yep, $1,567,009 to be exact. If that number made your jaw drop, you’re not alone. New Jersey consistently ranks as one of the most expensive states to retire in, thanks to sky-high housing, healthcare, and overall living costs. But don’t panic—this article breaks it all down for you. Whether you’re just starting out or are nearing retirement, you’ll learn exactly what it takes to secure a financially stable, comfortable retirement in the Garden State.
How Much You’ll Need to Retire Comfortably in New Jersey
Retiring comfortably in New Jersey takes real planning and commitment. With high living costs and rising healthcare expenses, the recommended $1.57 million nest egg may sound steep—but it’s entirely achievable with discipline, smart investing, and early action. Whether you’re in your 20s just starting to save or in your 50s doing a final checkup, now’s the time to take retirement seriously. Leverage your employer plans, take advantage of tax incentives, and adjust your lifestyle to set yourself up for a future filled with peace of mind.
| Feature | Details |
|---|---|
| Estimated Retirement Savings (NJ) | $1,567,009 for 20 years |
| Monthly Savings Needed (Age 20 Start) | ~$2,902/month |
| Monthly Savings Needed (Age 30 Start) | ~$3,731/month |
| Annual Retirement Costs (Without Social Security) | ~$79,957 |
| Annual Costs (With Social Security) | ~$41,315 |
| Where NJ Ranks | Among the top 5 most expensive states to retire |
| Official Source | GoBankingRates Study |
Why New Jersey Is So Expensive for Retirees?
Let’s not sugarcoat it—retiring in New Jersey comes with a price tag. While the state has its perks, like great healthcare access, proximity to major cities, and beautiful coastal towns, the costs can really stack up.
1. High Cost of Living
According to the U.S. Bureau of Economic Analysis, New Jersey’s cost of living is roughly 15% higher than the national average. Everything from groceries to insurance is more expensive here. This significantly impacts retirees who are living on fixed incomes.
2. Property Taxes
New Jersey consistently ranks #1 for the highest property taxes in the country, with an effective tax rate around 2.23%—more than double the national average. Even if you own your home outright, these taxes can eat into your retirement budget.
3. Healthcare Expenses
Healthcare in retirement is a major cost, and it’s only getting higher. The average retiree in NJ spends $8,528 per year on healthcare, not including long-term care. When you add in dental, vision, and out-of-pocket expenses, you can expect this figure to grow.
4. Housing and Utility Costs
Housing remains one of the biggest line items. Retirees in New Jersey spend around $16,399 annually on housing. Utilities average $4,356 per year, driven by cold winters and humid summers that demand both heating and air conditioning.
The $1.57M Retirement Number: Where It Comes From
The figure of $1,567,009 comes from a 2025 GoBankingRates analysis that factors in a 20-year retirement (age 65 to 85) without Social Security. It includes housing, healthcare, food, transportation, utilities, and personal expenses.
Here’s a detailed breakdown:
| Category | Annual Cost |
|---|---|
| Housing | $16,399 |
| Food/Groceries | $5,164 |
| Healthcare | $8,528 |
| Utilities | $4,356 |
| Transportation | $4,886 |
| Miscellaneous | $40,624 |
| Total (Yearly) | $79,957 |
Multiply that by 20 years and you get close to the $1.57M estimate.
Monthly Savings Targets
Now, let’s say you’re starting from scratch. How much would you need to save monthly to reach this goal?
- Start saving at 20: You’ll need about $2,902 per month for 40 years.
- Start saving at 30: You’ll need about $3,731 per month for 35 years.
That might sound intense, but remember this assumes zero Social Security income and a conservative 7% return. With Social Security factored in, your savings burden may decrease significantly.
Can You Retire on $1 Million in NJ?
The short answer: maybe—but it’s tight.
Without Social Security, $1 million might last you about 12.5 years in New Jersey. Add in the average Social Security payout of $1,907/month and your money could stretch to around 24 years, depending on inflation and investment returns.
Still, that’s cutting it close. You’ll need to be frugal, and possibly consider relocating to a more affordable area.
Social Security: A Key Piece of the Puzzle
Most Americans will rely heavily on Social Security. As of 2025, the average monthly benefit for a retired worker is $1,907 or roughly $22,884 annually. That can cover over 50% of a retiree’s yearly cost of living if they stick to a frugal lifestyle.
However, the Social Security trust fund is expected to only be able to pay out 81% of scheduled benefits by 2034 unless Congress intervenes. So, it’s smart to plan conservatively and not over-rely on government payouts.
Smart Saving Strategies to Hit the Mark
1. Max Out Retirement Accounts
- Contribute to your 401(k) up to the employer match.
- Open a Roth IRA for tax-free withdrawals in retirement.
- If you’re self-employed, consider a Solo 401(k) or SEP IRA.
In 2025, the 401(k) contribution limit is $23,000 (or $30,500 if you’re 50+). The Roth IRA limit is $7,000 ($8,000 if 50+).
2. Automate Your Investments
Set up automatic transfers so money goes straight into your retirement accounts before you even see it. Out of sight, out of mind—but working hard in the background.
3. Use HSAs for Healthcare
A Health Savings Account (HSA) can be a great retirement vehicle if used strategically. Contributions are tax-deductible, growth is tax-free, and withdrawals for medical expenses are tax-free.
4. Rebalance Annually
Adjust your asset allocation as you get closer to retirement. In your 30s, aim for 80–90% stocks. By your 60s, reduce that to 50–60% stocks and increase your bond and cash holdings for stability.
Tax Considerations for NJ Retirees
New Jersey offers some relief for retirees:
- No tax on Social Security benefits
- Retirement income exclusion up to $100,000 if you’re 62 or older and meet income thresholds
- Senior Freeze: A property tax relief program for eligible seniors
Step-by-Step Planning Guide To Retire Comfortably in New Jersey
- Get a Baseline – Use a retirement calculator to estimate how much you’ll need.
- Create a Budget – Track your current spending and determine where you can cut back.
- Increase Contributions Annually – Even a 1% bump can make a big difference over time.
- Diversify Your Portfolio – Use a mix of index funds, ETFs, and bonds to spread out risk.
- Plan for Healthcare – Include long-term care insurance in your strategy if possible.
- Delay Social Security – If you can, waiting until age 70 increases your monthly benefit.
- Meet with a Financial Planner – A CFP can personalize your plan and ensure you’re on track.
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Professional Tips to Maximize Retirement Outcomes
- Reevaluate your plan annually to account for market fluctuations and life changes.
- Use a CPA to maximize your tax efficiency during retirement withdrawals.
- Consolidate accounts for easier management and reduced fees.
- Build an emergency fund of at least 6 months’ expenses to avoid dipping into retirement savings.
- Consider annuities only with professional guidance—they can be useful but come with complexity and fees.
