States – Indiana


Indiana is in the heartland of America, with a few larger cities, many small towns, and lots of open countryside. The northern part of the state borders Lake Michigan, and also is close to 2,793-acre Chain O’ Lakes State Park, which has access to eleven lakes for boating, fishing, and camping. Southern Indiana has the Ohio River and Patoka Lake, the Hoosier National Forest, rolling hills, and rugged caverns.

Lake effect winds and snow are common in the north, while the southern parts are warmer. Overall, the Hoosier State has a humid-continental climate, with four distinct seasons, hot summers and cold winters. There can also be tornadoes in the spring and summer. Major industries in the state are manufacturing and agriculture.

Indiana has many parks including the Dunes National Lakeshore and the 202,000-acre Hoosier National Forest. In addition to natural attractions, Indiana is also rich in cultural venues. Indianapolis is known for its musical and artistic environment, but even many smaller towns have galleries and notable architecture. The state is home to over 50 colleges and universities and has an artistic scene that ranges from concerts and operatic performances to local art festivals. 

Indiana residents are proud of their contagious welcoming and cheery nature. The ‘Hoosier Hospitality’ contributes to a positive and comfortable retirement lifestyle.

The cost of living in Indiana is 14 percent below national average. The median home price is $113,000 which is well below the national median. Home prices vary widely across the state. In major urban areas like Indianapolis, home prices can exceed $250,000.

Indiana’s total tax burden is #23 in the nation. The income tax rate is a flat 3.3% which is the 10th lowest in the country. Social Security benefits are not taxable, but most other pensions are. Up to $2,000 of military pensions to recipients 60 and older can be excluded. The state sales tax is 7%. The median per capita property taxes at $994 are high compared to most states. There is a homestead exemption, and there are programs to assist seniors and lower-income residents to reduce their property taxes. There are no estate or inheritance taxes.

Here are several places to look at as possible retirement destinations.


Columbus was included on AARP’s 2011 list of 10 affordable cities for retirement. A town of 45,000 in south central Indiana, Columbus is less than an hour south of Indianapolis.

Columbus is a city known for its architecture. Experts compare the city’s innovative architecture favorably with major cities like San Fancisco and Chicago. There are so many buildings and sculptures designed by notable artists and architects that the town is sometimes called “Athens of the Prairie.” Six buildings dating to the mid-Twentieth Century are National Historic Landmarks. There are also dozens of pieces of public art around town celebrating the town’s industrial heritage and western roots.

Columbus has over 700 acres of parks and green space and over 20 miles of trails that pass intriguing works of art, wildflower gardens, and unique neighborhoods. There are several athletic and community facilities, including an aquatic center, softball complex, and ice skating rink. Columbus has it all: design cognoscenti say the city’s innovative architecture ranks right up there with Chicago’s and San Francisco’s.


Bloomington is also in south central Indiana. A town of 85,000 Bloomington is home to Indiana University Bloomington with over 42,000 students. Author Thomas Gaines named the Bloomington campus one of the five most beautiful in America.

Bloomington has several professional and amateur theater companies, including the university’s department of theatre & drama, Cardinal Stage Company, the Bloomington Playwrights Project, and Theatre of the People. The Indiana University Auditorium is a 3,000-seat performing arts venue which brings in national performing groups.

Another venue is the Buskirk-Chumley Theater, which is a renovated 616 seat live performance venue and movie theater built in 1922. In 2006, the theater played host to more than 260 public performances. Bloomington also has the Ivy Tech Waldron Arts Center, which has hosted hundreds of performances over the last two decades.

Bloomington hosts many regular events during the year. Taste of Bloomington each June features food and drink from dozens of Bloomington’s best restaurants, local wineries and breweries and live music. Fourth Street Arts and Crafts Festival held each September is a free event that has work by local artists and craftspeople, along with live music and entertainment. The Bloomington Farmers Market is held weekly from April through November and has produce and prepared foods from local vendors.

Bloomington has several other major shopping venues. The downtown area has many locally owned restaurants and shops. Fountain Square Mall contains Buskirk Chumley Theater, the Monroe County Court House, many locally owned and operated local restaurants, nightclubs and businesses, and several churches.

South Bend

Located at the northern end of Indiana, 84 miles from Chicago, South Bend (population 101,000) is known as the home of Notre Dame University. South Bend appeared on AARP magazine’s 2013 list of 10 low-cost cities to “Retire to a Good Life for Less.” The town features low home prices and cost of living, along with many free cultural and entertainment options.

South Bend has a thriving musical environment. The city hosts several annual music festivals. The South Bend Reggae Music Festival attracts some of the world’s top Reggae artists every summer. Proceeds from the festival are given to the Pangani Foundation of South Bend, which provides medical supplies to hospitals in Malawi.

A local country radio station sponsors an Annual All Day Country Concert. Each July, South Bend hosts The World Pulse Festival, an annual Christian contemporary music festival that attracts more than 50,000 visitors each year. Sounds by South Bend is an annual music festival started in 2013 and modeled after the famous South By Southwest of Austin, TX. The festival is a celebration of the local music scene, with local bands and artists performing in venues around the city.

The Morris Performing Arts Center houses the Broadway Theater League and the South Bend Symphony Orchestra. The annual Fischoff National Chamber Music Competition, the world’s largest chamber music competition, is held on the campus of the University of Notre Dame.

South Bend has many museums. The downtown South Bend Museum of Art features a variety of artists from South Bend and the surrounding region. The museum houses over 850 works and offers several classes and workshops for adults and children. The Northern Indiana History Museum has several buildings that depict the history of the northern Indiana region.

The city maintains over 50 parks, golf courses, and recreational areas. The 23-acre zoo is the oldest in the state and has over 400 animals. Next to the zoo are greenhouses and botanical conservatories. Rum Village Park has a disc golf course, hiking and mountain bike trails, and a nature center, and Potawatomi Park, which has the region’s largest Universally Accessible Playground and an outdoors performance arts pavilion.

For more information about retirement in Indiana:

State overview in facts and figures

State taxes

State services for senior residents

Profiles of major cities

Retirement communities

Best regions for retirement