The Golden State could be a fool’s gold choice for your golden years. Except for Social Security benefits, retirement income is fully taxed, and California imposes the highest state income tax rates in the nation (the top rate is a substantial 13.3%). The state sales tax of 7.5% — a temporary hike from 7.25% that’s set to expire in 2016 — is also daunting. The sales tax can reach as high as 10% in certain cities and counties that collect additional local taxes. It’s no wonder why California ranks so high among the top ten tax-unfriendly places for retirees.
Upside? I’ll never be able to afford to retire anyway.