How Much Single Retirees With Annuities Need in All 50 States

How much single retirees need for a comfortable retirement depends on both annual spending and income they can count on. In this estimate, a single retiree age 65 or older needs about $898,000 invested after Social Security, before accounting for an annuity purchase. An annuity can lower that remaining target, but buying one uses savings upfront.

At a Glance

• The estimated annual spending for a typical single retiree is about $59,600, including discretionary costs.
• Average annual Social Security benefits for a single person claiming at 65 are about $23,700, leaving roughly $35,900 to fund from other sources.
• Using the 4% withdrawal rule, each $500 in monthly annuity income lowers the modeled invested savings target by $150,000.
• The calculation excludes the money spent to buy the annuity, and state living costs still create large differences in the amount needed.

How much single retirees need before annuity income

The national estimate starts with spending, not a chosen savings balance. A typical retired person living alone spends about $59,600 a year, based on the analysis of federal data. That figure includes nonessential costs such as travel, restaurant meals and entertainment as well as regular household expenses. It is a model of a comfortable retirement, not a minimum budget.

For a single person claiming Social Security at age 65, the average annual benefit used in the estimate is about $23,700. That covers approximately 45% of the modeled spending. The remaining annual gap is about $35,900, which would need to come from savings, annuity payments or another source of income.

The model uses the 4% rule to translate that annual gap into an invested balance. The rule begins with withdrawals equal to 4% of the portfolio, then adjusts those withdrawals each year for inflation. Dividing the $35,900 gap by 0.04 produces a target of about $897,500, commonly rounded to about $898,000.

This is a planning estimate, not a promise that a particular portfolio will support a particular lifestyle for a set number of years. Actual spending, benefits and investment results differ. The calculation also treats the Social Security figure as an average, so it will not match every retiree’s benefit statement.

Location changes the starting point. Estimated annual spending for single retirees runs from about $49,000 in the least expensive states to more than $64,000 in the costliest. In the state comparison, the modeled savings target without an annuity ranges from about $643,600 in North Dakota to nearly $1.02 million in New Jersey, a spread of almost $375,000.

How monthly annuity income changes the savings math

The calculation is straightforward: subtract annual Social Security and annuity income from annual spending, then divide the remaining gap by 4%. A $500 monthly annuity payment equals $6,000 a year. Under this model, that income replaces the need to withdraw $6,000 annually from investments, which corresponds to $150,000 of portfolio value at a 4% withdrawal rate.

The same arithmetic applies at higher payment levels. A $1,000 monthly payment equals $12,000 a year and reduces the modeled invested balance by $300,000. At $2,000 a month, or $24,000 a year, the reduction is $600,000. These are reductions in savings that need to remain invested after the annuity is purchased, not estimates of the annuity’s price.

The national figures below use about $23,700 in annual Social Security and the 4% rule. They show the remaining invested balance required at each income level. The $2,500 scenario is included in the underlying calculation, although the main examples often focus on payments from $500 to $2,000 a month.

These figures can be useful for comparing income scenarios, but they should not be mistaken for a product quote. An annuity payment depends on contract details and pricing factors. The analysis does not say how much a particular buyer would have to pay to receive any of the monthly amounts shown.

Consider the example of someone who has $700,000 and spends $150,000 to buy an annuity. The remaining invested balance would be $550,000, alongside the annuity payment. In this framework, the relevant nest egg is the $550,000 left invested. The original $700,000 is not all available for other purposes once the purchase is made.

Quick Facts

• Every $500 per month in modeled annuity income reduces the needed invested balance by $150,000.
• At $1,000 per month, the national remaining balance is about $597,800, compared with $897,800 without an annuity.
• At $2,000 per month, the modeled national balance is about $297,800, excluding the annuity purchase cost.
• The state comparison uses 2024 federal data on housing, consumer spending and regional price differences.

State costs still shape the target

Annuity income reduces the model’s savings requirement by the same dollar amount in every state. A $500 monthly payment lowers each state’s target by $150,000. A $1,000 payment lowers it by $300,000, and a $2,000 payment lowers it by $600,000. The payment does not erase the cost difference between places. It simply subtracts the same amount from different starting estimates.

With $1,000 a month in annuity income, the model leaves a target of about $718,000 in New Jersey and almost as much in Hawaii. North Dakota falls to about $344,000, while Arkansas is about $348,000. Those gaps reflect different estimated retirement costs, rather than different effects from the annuity calculation.

At $2,000 a month, the remaining target ranges from about $44,000 in North Dakota to roughly $418,000 in New Jersey. Arkansas also comes in below $50,000. Hawaii, California and Washington, D.C., remain above $400,000.

The lowest modeled figure should not be read as proof that a retiree in that state can safely spend down savings to that amount. The table isolates an estimated spending gap under a particular method. It does not account for every household’s needs or establish a personal reserve for unexpected costs. A state average is a starting point for a budget, not a replacement for one.

The upfront cost and contract details matter

The central trade off is between an income stream and access to the money used to obtain it. Monthly payments can cover part of the spending gap and reduce the amount that must stay invested. But the purchase itself requires a lump sum from savings. A smaller remaining portfolio is not automatically a sign that retirement costs less overall.

Payment amounts and terms are not interchangeable across contracts. Pricing can vary with the buyer’s age, interest rates, the length of the payout, survivor coverage, inflation protection, guarantees and other contract features. The figures in this analysis do not provide a price, rate of return, fee schedule or guarantee for any annuity.

Eligibility and available terms are determined by the insurer and the contract being considered. The analysis does not specify age rules, health requirements or other qualification conditions for a product. Anyone comparing an offer would need to check the actual contract and quote rather than assume that the modeled monthly payment is available on the same terms to every buyer.

Different annuities can also vary in when payments begin, how long they continue, whether another person can receive payments after the buyer’s death, and what guarantees or restrictions apply. Riders and other contract provisions may change the terms. Because a purchase can commit a substantial portion of savings, details matter as much as the headline monthly payment.

A practical comparison begins by writing down spending that must be covered each month and spending that can vary. Then compare the Social Security amount expected by the retiree with the budget, and calculate the gap. A quote can then be assessed against that gap, while also checking how much savings would remain available after the purchase. This makes the trade off visible without treating a modeled payment as a recommendation.

Useful questions for reviewing an offer include when payments start, how long they last, whether payments change over time, what happens to a surviving spouse or beneficiary, and what guarantees or restrictions apply. The contract should also be checked for charges or features that affect the amount paid or received. The source figures do not supply those terms, so they cannot settle whether a specific offer fits an individual’s needs.

How the estimate was built, and what it leaves out

The estimates use 2024 federal data on housing, consumer spending and regional price differences. The model calculates costs for a single retiree in each state and defines comfortable retirement spending broadly, including discretionary expenses rather than only essential bills.

For each state, the method subtracts about $23,700 in average annual Social Security benefits and any modeled annuity income from estimated annual spending. It divides the remaining annual amount by 4% to produce the invested balance estimate. The lump sum used to purchase an annuity is excluded.

That last point is essential. A lower number in the table means less needs to remain invested after the annuity is in place. It does not mean the same amount can be removed from a savings plan without cost. The annuity purchase uses part of the assets, and the table does not add that purchase amount back into the remaining balance.

The model also does not establish that the 4% rule will work for every retiree or capture every possible expense. Its purpose is to show how fixed monthly income changes a savings calculation under consistent assumptions. Personal spending, actual Social Security benefits and contract terms can move the result in either direction.

How much savings remains after an annuity purchase?

Before relying on any target, compare three figures: a realistic annual spending budget, the Social Security benefit expected, and the amount of savings left after any proposed annuity purchase. Then compare the remaining gap with the contract’s actual income terms. The modeled reductions are useful for understanding the arithmetic, while the purchase cost and contract provisions determine what the decision means in practice.

For a single retiree, the national example puts the post purchase invested target near $748,000 with $500 a month of annuity income, or about $298,000 with $2,000 a month. State costs can leave a very different target, even after the same payment is applied. The open question is not only how much the annuity reduces the portfolio target, but whether the income and terms leave enough accessible savings for the rest of retirement.