How Much Do You Need to Retire Comfortably in Arkansas?

By Roxanne Martens, MS, CFP®

If you’re thinking about retiring in Arkansas, you’re in good company. With its low cost of living, tax-friendly policies, and beautiful scenery, it’s no surprise that more retirees are choosing to call it home. But the big question remains—how much do you actually need to save?

The answer depends on a few key things: your lifestyle, healthcare needs, and how you want to spend your time in retirement. Arkansas makes things a little easier with affordable housing, low property taxes, and tax breaks on retirement income—but a comfortable retirement still takes planning.

In this guide, we’ll review real-life costs, savings strategies, and key factors to consider so you can feel confident about your financial future.

Tax Benefits That Make Arkansas Retirement-Friendly

How you’re taxed in retirement can shape how far your savings stretch—and Arkansas provides tax advantages that reduce the financial burden on retirees. 

First, Social Security benefits are not taxed at the state level, a policy that directly benefits retirees living off those checks.

Pension income and IRA withdrawals up to $6,000 annually (or $12,000 for married couples) are also excluded from state taxes. The taxpayer or spouse need not be retired to take advantage of this exemption, and it also applies to distributions from an IRA due to death or disability after age 59 ½ (such as required distributions from an inherited IRA).

To top it off, Arkansas has some of the lowest property taxes in the country. The average effective rate is 0.53%, ranking 14th-lowest nationwide. This means that less of your retirement budget goes toward taxes. 

How to Estimate How Much Retiring in Arkansas Costs 

Determining your ideal savings target starts with your priorities. Although the lowered cost of living and tax benefits in Arkansas remove some of the financial strain, your individual circumstances—your homeownership status, healthcare requirements, and leisure activities—are an important determinant of your budget.

A good place to begin might be to outline your estimated monthly expenses, such as:

• Discretionary spending: Travel, recreation, or other discretionary expenditures
• Healthcare gaps: Medicare premiums, supplemental insurance, and potential long-term care costs
• Essentials: Housing (rent or property taxes), groceries, utilities, and healthcare

Many analyses lean on the 4% guideline, which proposes withdrawing no more than 4% of your savings annually to reduce the risk of outliving your funds.

If your annual spending goal is $100,000, you’d need roughly $2.5 million in savings. But in Arkansas, where living costs are approximately 11.3% to 16% below the national average, that target could drop a bit for a frugal couple who are already debt-free and supplementing with Social Security.

To determine how much you should be putting aside, a good rule of thumb is to save at least 15% of your pre-tax income every year, beginning in your 20s. This encompasses 401(k) plan contributions, IRAs, and any employer match.

While rules like Fidelity’s 15% guideline provide a starting point, adjustments may be needed depending on your career timeline, your financial obligations, or how you plan on retiring in Arkansas.

How to Plan for Retiring in Arkansas

Retirement stability depends on what you save, where it comes from, and how you manage it.

For example, as you get closer to retiring in Arkansas, you may want to slowly rebalance your portfolio in favor of lower-risk investments, such as bonds and dividend-paying stocks, to generate a consistent income stream and shield your savings from the market’s volatility.

Also, keep in mind that although Arkansas does not have an estate tax, federal taxes are still applicable for estates exceeding the $13.99 million 2025 limit (up from $13.61 million in 2024). Updating legal documents like wills, trusts, or beneficiary designations every three to five years—or after major life events—can help keep your plans in sync with your goals.

Get Financial Guidance From CGN Advisors

Retirement planning brings plenty of questions, and the path looks different for everyone. At CGN Advisors, we focus on simplifying the process, whether it’s maximizing Arkansas tax benefits or adjusting withdrawal strategies.

As independent, fee-only advisors specializing in financial planning and investment management, our mission is to help you strike a balance in your life between enjoying today and planning for tomorrow. To schedule a meeting, call our Rogers, AR, office at (479) 335-1034. 

About Roxanne

Roxanne Martens is a CERTIFIED FINANCIAL PLANNER® professional and serves as a Lead Financial Advisor on the team at CGN Advisors, a Fee-Only, financial advisory firm based in Manhattan, Kansas. Roxanne works out of CGN’s Arkansas location, serving clients in the Rogers, Bentonville, Springdale, and Fayetteville areas. An advisor since 2020, she works with corporate executives, young professionals, and those approaching retirement by helping them utilize their growing income efficiently and facilitating strategic cash flows once their regular earned income ends. She enjoys using her skill set to educate and guide clients through life as they make financial decisions and set goals. Roxanne says, “Comprehensive financial planning and investment management takes a lot of trust from the client, and I don’t take that lightly. I genuinely want each of my clients to succeed.” Her favorite aspect of her role is connecting with clients on a personal level, providing clarity and peace, and being able to witness them realize their dreams.

Roxanne obtained her master’s degree in personal financial planning from Kansas State University and holds the CFP® designation. Prior to becoming a financial advisor, she taught in the Personal Financial Planning program at Kansas State University for seven years. As a mom with young children, most of her free time is spent with her husband, John, and two sons, Johnny and Judd. They enjoy living life outdoors—bike rides and spending time at the lake or pool. To learn more about Roxanne, connect with her on LinkedIn.

Investment advisory services are offered through CGN Advisors, LLC, a fee-only SEC registered investment advisor. Tel: (910) FEE-ONLY. 

Investing involves substantial risk and has the potential for partial or complete loss of funds invested. Investments mentioned may not be suitable for all investors. Before investing in any investment product, potential investors should consult their financial or tax advisor, accountant, or attorney with regard to their specific situation. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies.

The opinions expressed herein are those of certain CGN Advisors, LLC personnel and are subject to change without notice. The opinions referenced are as of the date of publication and are subject to revision due to changes in the market or economic conditions and may not necessarily come to pass. Any opinions, projections, or forward-looking statements expressed herein are solely those of the author, may differ from the views or opinions expressed by other areas of the firm, and are only for general informational purposes as of the date indicated.