Tag Archives: relocating

Where Will You Live When You Retire?

Where Will You Live When You Retire?     Retirement may be the perfect opportunity to do something you’ve been considering for years: move to a different state or region. But how do you decide which one? 

 Consider what taxes you’ll pay. Five states don’t charge sales tax: Alaska, Delaware, Montana, New Hampshire and Oregon. But you’ll pay tax on certain items in these states, anyways, including cruise ship-related expenses in Alaska, and restaurant meals, lodging and rental cars in New Hampshire.

Seven states don’t charge income tax: Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming. Two others, New Hampshire and Tennessee, tax only dividend and interest income.(You’re thinking about New Hampshire now, aren’t you?)

Don’t forget about another big source of income for states: property tax. Guess who’s one of the worst for this annual hit? New Hampshire, of course, though it’s passed by a surprise entrant: Wisconsin! The others in the Top Ten are New Jersey, Connecticut, New York, Massachusetts, Rhode Island, Illinois, Vermont…and of course, California. (Hey, they have to make up the shortfall somewhere.)

Choose a state with lower property tax, and you’ll save big. According to the Tax Foundation, the median property tax in Louisiana is only $180 — compare that to New Jersey’s average fee of $5500! The list here includes Wyoming (thinking about that state now?), Oklahoma, New Mexico, Kentucky, South Carolina, Arkansas, Mississippi, West Virginia, Alabama and Louisiana. (The latter is on the ‘best weather’ list, too.)  See the Top Ten lists for both here, along with specifics.

 How about weather? Current results.com released a study of the top ten U.S. states with the ‘best weather.’ Their criteria was based on:

  • Comfortable temperatures, with daily highs averaging between 63 and 86 degrees Fahrenheit (17 to 30 degrees Celsius) for seven or more months of the year
  • Dry weather, at most 60 inches (152 centimeters) of rain a year
  • Mainly clear skies, with sunshine for at least 60 percent of the time on a yearly average

The winners? Hawaii, Texas, Arizona and Georgia are in the top five, with California topping the list. The only problem: these states are also uncomfortably hot at times. (And, depending on which area of the state you live in, you’ll have to give up the idea of snow for Christmas. Figures.) Do you enjoy gardening or outdoor activities…or would you rather not?

What about overseas? A number of countries, especially those in Mexico, the Caribbean and points further south, have warm weather year-round. Costs of living are often lower; some countries, like Panama, even offer special discounts for American retirees.

Friends, family and familiarity. If you move, you’ll probably give up one — or all three. (Or in the case of kids or friends who have already moved out of state, you may be getting them back!) And with patience and determination, you’ll learn more about your chosen site. But do you want that?

A poor economy may actually work in your favor this time. That is, if you have fixed income or assets you can rely on. Housing can suddenly be a real bargain. (Michigan, for example, was hard-hit by the tanking of the auto industry. Detroit area real estate, as well as homes all over the state, has rarely been lower.) Recreation and living costs are lower, too. Just don’t always expect that jobs will be easy to find.

     Choosing a good retirement location deserves time and careful attention: don’t rush into it.  A good all-around site, with many articles, is at US News’ Money site. Their ‘Retirement’ section pegs ‘ten best’ lists for all sorts of parameters, including best for singles; places for managing on Social Security income alone; even the best areas to live a few decades from now.  If this site doesn’t answer at least one of your questions, you’re not looking hard enough!