Retire to Alabama when you’re 65 or older, and you pay no property taxes. These cities have the lowest cost of living in all of Colorado. Residents enjoy restaurants, coffee shops, and parks and take advantage of family-friendly activities. Total expenditures: $100,207 20% comfort buffer: $25,052 Cost of a comfortable retirement annually: $125,259 More From GOBankingRates. Ranking based on data from the U.S. Census, FBI, CDC, and other data sources. Free Retirement Calculator: When Can You Retire? Colorado has a flat tax rate of 4.63%, one of the country's lowest. Due in part to its increasing popularity, the cost of living in the immediate Denver area is higher than the national average. It falls close to the national median of 100 with a 2014 index of 101.3. Over Half of Americans Are Missing Out on Free Money — Are You One of Them? Marginal Income Tax Rates. Tax Burden: Total state/local tax burden in Colorado of 8.9% is lower than average, 35th highest in the nation. Listed above are the most affordable places to live in Colorado with a population of more than 5,000 people. What you are left with is a "Cost of Living Index" by taking the average rank of each of these metrics for each city. If you’re looking to live on a more modest retirement income, bordering cities like Colorado Springs and Englewood are less expensive. — Click Here to Find Out While Colorado ranks above average for cost of living, its cost of living index – a number derived by the Council of Community and Economic Research – isn't that much higher than average. Housing is affordable, and the economy is stable. Topping the list of the most affordable city in Colorado is Federal Heights, a suburb of Denver. However, if you’ve retired with a nice nest egg, that may not be a factor for you. Here are some of the best places in Colorado to retire, in no particular order: Fort Collins, CO Pedestrian Mall View – Old Town Fort Collins, CO. Photo: Joe Wolf. Taxes. The median house price in this town is just $124,000, and retirees on a budget can save even more by opting for a condo, trailer or townhome. Retirement Income Exemptions. 2020 Best Places to Retire in Colorado About this List Explore the best places to retire in the U.S. based on number of retirees, weather, and access to healthcare and entertainment. The cost of living is relatively low in Alabama, and there are many choices for entertainment and medical care. If you score a retirement home in the south part of the state, you’ll have access to stunning beaches. Located in the Rocky Mountains south of Colorado Springs and north of Pueblo, Canon City has a population of 30,000, and a cost of living that is 9 percent lower than the national average. The mild climate still brings nearly 300 days of sunshine per year while still managing to fill ski resorts with a blanket of snow. 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