Before moving to Hawaii, Clif Purkiser lived in San Jose, Calif., so he was accustomed to a high cost of living. "The biggest issue is housing," he says. "It's just like the Bay Area: If you can manage housing, you can find ways to mitigate the costs of everything else."
Purkiser says his health insurance is "cheap" compared to most of America. "I think my $300-per-month plan and $25 copays are a bargain compared to what some people on the mainland are paying," he says.
Taxes are another issue in Hawaii. While the Aloha State charges no sales tax, an excise tax is levied on all goods and services. "This can make life more expensive than in the rest of the country. The good part is that, in Hawaii, your pension income is mostly exempt from taxes, and that can drop your tax burden down quite a bit," Purkiser says.
Purkiser admits that most Americans would find it almost impossible to retire in Hawaii, but he estimates $3,000 per month could be enough for a retired married couple, on top of housing costs. While housing in Honolulu runs about $2,700 a month, "If you go outside of the city, you can rent a small bedroom for $1,100 or $1,200 per month," Purkiser says. "Like the rest of the country, there are some deals in the suburbs."