In Carlsbad, California, retirees live on an average income of $85,442 a year from Social Security payments and withdrawals from savings and investments — the highest amount of any of the 344 largest U.S. cities, according to a recent SmartAsset analysis of Census Bureau data.
These two sources generally make up the majority of retirees’ income. In fact, 58% of retirees say Social Security is a major source of their income, according to a 2024 Gallup poll. In 2025, eligible Americans will receive an average of just under $24,000 a year in retirement benefits, according to the Social Security Administration.
But because Social Security retirement benefits are partially tied to earnings, higher earners tend to get bigger checks when they start claiming, though there is a cap. The same group is also likely to save more for retirement during their working years, which is why the cities where retirement income is the highest also tend to have the largest average Social Security benefits.
In just 19 of the cities SmartAsset analyzed, Social Security checks make up more than half of retirees’ total income, and those places are home to some of the lowest-earning retirees overall. In the 10 highest-earning cities, Social Security makes up roughly 30% to 40% of retirees’ total income.
Further, Social Security payments don’t seem to vary as widely as retirement account withdrawals, per SmartAsset’s findings. Average annual Social Security benefits span from a low of $15,421 in Hartford, Connecticut, to a high of $31,752 in The Woodlands, Texas. In contrast, the lowest average retirement withdrawals come in at $16,282 a year in Allentown, Pennsylvania, compared with the highest in Carlsbad at $56,685.
Here’s where retirees bring in the most each year, between Social Security payments and retirement account withdrawals.
1. Carlsbad, California
- Average income from retirement accounts: $56,685
- Average Social Security income: $28,757
- Total: $85,442
2. Bellevue, Washington
- Average income from retirement accounts: $55,346
- Average Social Security income: $29,715
- Total: $85,061
3. Naperville, Illinois
- Average income from retirement accounts: $54,134
- Average Social Security income: $30,921
- Total: $85,055
4. Arlington, Virginia
- Average income from retirement accounts: $55,856
- Average Social Security income: $26,396
- Total: $82,252
5. Sugar Land, Texas
- Average income from retirement accounts: $52,946
- Average Social Security income: $27,955
- Total: $80,901
6. Norman, Oklahoma
- Average income from retirement accounts: $55,056
- Average Social Security income: $25,121
- Total: $80,177
7. Alexandria, Virginia
- Average income from retirement accounts: $53,697
- Average Social Security income: $25,576
- Total: $79,273
8. The Woodlands, Texas
- Average income from retirement accounts: $47,281
- Average Social Security income: $31,752
- Total: $79,033
9. Boulder, Colorado
- Average income from retirement accounts: $50,280
- Average Social Security income: $27,906
- Total: $78,186
10. Carrollton, Texas
- Average income from retirement accounts: $54,319
- Average Social Security income: $23,602
- Total: $77,921
The amount you’ll receive from Social Security in retirement varies based on a number of factors, including how many years you worked, how much you contributed to Social Security taxes, your birth year and the age you start claiming benefits.
Your benefits may be reduced if you start collecting earlier than your full retirement age, which is 67 for Americans born in 1960 and later.
You have more control over the amount you’re able to withdraw from tax-deferred retirement accounts like 401(k)s, although there are still some restrictions. You can start withdrawing money at age 59½, but once you turn 73, you generally must take out a set amount each year, known as required minimum distributions.
How much money do you need to retire?
The amount of money you’ll need each year in retirement can vary widely based on your location, if you plan to work at all and what kind of lifestyle you want.
A comfortable life — meaning your essential bills are covered and you have some extra funds for leisure or unexpected costs — could run you as little as $61,000 a year in Mississippi or over $129,000 a year in Hawaii, according to 2024 estimates from GOBankingRates.
A general rule of thumb for retirement planning is to aim to live on 4% of your savings your first year in retirement, then adjust that amount for inflation going forward. The idea is that making withdrawals of around 4% each year will allow you to live off your savings for roughly 30 years.
For reference, a retiree in Carlsbad would need over $1.4 million invested to be able to take out $56,685 in their first year following the 4% rule.
But you may need more or less, depending on the lifestyle you want. When deciding the total amount of savings to aim for, take into account factors such as where you plan live, how long you expect to be retired and how you plan to spend your time.
Want to boost your confidence, income and career success? Take one (or more!) of Smarter by CNBC Make It’s expert-led online courses, which aim to teach you the critical skills you need to succeed that you didn’t learn in school. Topics include earning passive income online, mastering communication and public speaking skills, acing your job interview and practical strategies to grow your wealth. Use coupon code MEMORIAL to purchase any course at a discount of 30% off the regular course price (plus tax). Offer valid from 12:00 am Eastern Time (“ET”) on May 19, 2025, through 11:59 pm ET on June 2, 2025. Terms and restrictions apply.
Plus, sign up for CNBC Make It’s newsletter to get tips and tricks for success at work, with money and in life, and request to join our exclusive community on LinkedIn to connect with experts and peers.
