South Carolina is quickly becoming a top choice for those pursuing Financial Independence, Retire Early (FIRE) thanks to its low cost of living, mild climate, and tax-friendly policies for retirees. With its beautiful beaches, charming small towns, and vibrant cities like Charleston and Greenville, South Carolina offers an excellent balance of affordability and quality of life.
One of the biggest financial advantages of retiring early in South Carolina is its low taxes on retirement income and affordable housing options, especially compared to northern states. The state also boasts warm weather, an outdoor-friendly lifestyle, and proximity to the mountains and the coast.
This guide explores the pros and cons of early retirement in South Carolina, including tax implications, cost of living, healthcare, and the best cities for FIRE retirees.
Key Terminology
Before we dive in, here are a few FIRE-related terms to keep in mind:
- FIRE (Financial Independence, Retire Early): A movement focused on accumulating wealth early to retire well before the traditional retirement age.
- Coast FIRE: A strategy where you aggressively save early and then let investments grow on their own while transitioning to semi-retirement.
- Lean FIRE vs. Fat FIRE: Lean FIRE requires frugal living, while Fat FIRE supports a more comfortable, luxury-based lifestyle.
- Geoarbitrage: Moving to a lower-cost location to maximize retirement savings.
- 4% Rule: A common rule of thumb suggesting retirees can withdraw 4% of their portfolio annually for sustainable income.
- State Tax Exemptions: Policies that reduce the tax burden on retirees, such as deductions on Social Security and retirement accounts.
What Is Early Retirement in South Carolina?
Retiring early in South Carolina allows FIRE enthusiasts to take advantage of low taxes, affordable housing (outside of major metro areas), and an excellent year-round climate. Unlike high-tax states in the Northeast, South Carolina does not tax Social Security income and provides generous deductions on other retirement income sources.
For those seeking a low-cost lifestyle, smaller cities like Columbia, Spartanburg, and Myrtle Beach offer affordable housing and a strong sense of community. Meanwhile, Charleston and Greenville provide more upscale living options with thriving cultural scenes.
How Does Early Retirement Work in South Carolina?
To achieve FIRE in South Carolina, you’ll need to optimize your tax strategy, manage living costs, and find a city that aligns with your budget.
1. South Carolina’s Tax Structure for Retirees
South Carolina is considered one of the most tax-friendly states for retirees.
- ✅ No State Tax on Social Security – South Carolina does not tax Social Security benefits.
- ✅ 401(k) and IRA Deductions – Retirees can deduct up to $15,000 in retirement account withdrawals.
- ✅ Low State Income Tax – South Carolina has a top income tax rate of 6.5%, but deductions reduce taxable income significantly.
- ✅ Low Property Taxes – South Carolina has some of the lowest property taxes in the U.S.
- ❌ Sales Tax Can Be High – The state sales tax is 6%, but local taxes can increase it to 9% in some areas.
2. Cost of Living Considerations
South Carolina offers a relatively low cost of living, especially compared to states in the Northeast and West Coast.
- Housing Costs (Median Home Prices in Key Cities):
- Charleston: ~$540K (High due to coastal demand)
- Greenville: ~$350K
- Columbia: ~$275K
- Myrtle Beach: ~$320K
- Spartanburg: ~$240K (One of the most affordable options)
- Rent Prices (Average for 1-Bedroom Apartment):
- Charleston: ~$2,100
- Greenville: ~$1,500
- Columbia: ~$1,200
- Myrtle Beach: ~$1,400
- Spartanburg: ~$1,100
✅ Affordable Cities: Columbia and Spartanburg offer budget-friendly housing options.
❌ Expensive Coastal Areas: Charleston and Hilton Head are pricier due to demand for beachfront living.
3. Healthcare in South Carolina
South Carolina has good healthcare options, though rural access can be limited.
- ACA Health Insurance Options: South Carolina has affordable ACA plans with subsidies available for early retirees.
- Highly Rated Medical Facilities: Top hospitals include Medical University of South Carolina (MUSC) in Charleston, Prisma Health in Greenville, and Grand Strand Medical Center in Myrtle Beach.
- Healthcare Costs: The average annual healthcare cost for retirees in South Carolina is around $7,200, slightly below the national average.
4. Outdoor Lifestyle and Recreation
South Carolina offers year-round outdoor activities at beaches, mountains, and state parks.
- Beaches & Coastal Living: Popular spots include Myrtle Beach, Hilton Head, and Kiawah Island.
- Hiking & Mountains: The Blue Ridge Mountains offer beautiful trails, waterfalls, and scenic drives.
- Golfing & Boating: South Carolina is a golfer’s paradise, and boating is popular along the coast and lakes.
- Historic & Cultural Attractions: Charleston is known for its history, food scene, and festivals.
How Does Early Retirement in South Carolina Compare to Other FIRE-Friendly States?
- South Carolina vs. Florida: Florida has no state income tax, but South Carolina has lower property taxes and a slightly lower cost of living.
- South Carolina vs. North Carolina: North Carolina has a milder summer climate, but South Carolina has lower property taxes.
- South Carolina vs. Texas: Texas has no state income tax, but South Carolina has a lower cost of living and fewer property taxes.
Pros and Cons of Retiring Early in South Carolina
✅ Pros of Early Retirement in South Carolina
✔ No Tax on Social Security – Keeps retirement income tax-friendly.
✔ Low Property Taxes – One of the lowest in the U.S.
✔ Affordable Cost of Living – Especially in Columbia, Spartanburg, and Greenville.
✔ Mild Winters & Year-Round Outdoor Lifestyle – Ideal for those who dislike cold weather.
✔ Proximity to Beaches & Mountains – The best of both worlds.
❌ Cons of Early Retirement in South Carolina
❌ Hot & Humid Summers – Summers can be very humid, especially along the coast.
❌ Hurricane Risk in Coastal Areas – Places like Myrtle Beach and Charleston face occasional storms.
❌ Limited Public Transportation – South Carolina is car-dependent outside of major cities.
❌ Higher Sales Tax in Some Areas – Local taxes can push the rate above 9%.
Best Practices and Tips for FIRE Success in South Carolina
✅ Choose an Affordable City – Columbia, Spartanburg, and Greenville offer lower housing costs.
✅ Take Advantage of Tax Breaks – Keep withdrawals under the state deduction limits for tax efficiency.
✅ Use Free Outdoor Activities – Hiking, beaches, and state parks provide entertainment for minimal cost.
✅ Plan for Healthcare Costs – Look into ACA subsidies if retiring before Medicare eligibility.
✅ Consider Downsizing – Coastal towns can be expensive, but inland areas offer budget-friendly options.
Conclusion
South Carolina is a top FIRE destination thanks to low taxes, affordable housing, and an outdoor-friendly lifestyle. However, hot summers, hurricane risks, and limited public transit require planning.
If you value beaches, warm weather, and a relaxed pace of life, South Carolina could be the perfect place for early retirement.
Would you consider retiring early in South Carolina? Let me know your thoughts!