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Rehoboth Beach, Delaware

For people living in the area between Southern New Jersey and Washington DC, a popular weekend and retirement destination lies near the Delaware shore. A three-hour drive from both Philadelphia and Washington DC, the Rehoboth Beach area has been a magnet for retirees over the past several years and Delaware expects the 65+ population to increase by 75 percent over the next 25 years.

The beaches feature dolphins throughout the summer months, a mile-long boardwalk and more than 70 restaurants. Although living in Rehoboth is quite expensive, residents living in nearby communities are only several miles from the beach and can take advantage of Delaware's favorable tax environment: low property taxes, no sales tax on food and entertainment, social security benefits are exempt from income tax and taxpayers aged 60 and older can exclude up to $12,500 of investment and pension income, according the AARP The Magazine.

Pictured: A view of the boardwalk in Rehoboth Beach, Delaware at Wilmington Avenue, looking North.

Photo: Dough4872