If you're one of the lucky ones, you have reached the point in life where your next big decision is where to retire. Of course, retirement is a major change in your lifestyle, but you may be ready to move where you know you'll get the most out of your savings and 401(k). Transitioning to this new lifestyle is not the easiest thing in the world, but deciding where to go shouldn't be as difficult.
Here are a few tips to help you decide where to retire:
Know how taxes will affect your move
Depending on the state you choose, taxes will change and could affect your total cost of living. According to U.S. News & World Report, retirees looking to move to a different state should consider how the potential states' taxes on pensions, property tax, Social Security, sales tax, and earned income will affect their budgets. Mary Languirand, author and expert on where and how to choose the best retirement spot, explained that depending on the area, taxes could make living affordably easier or much more difficult
"There are some services for senior citizens that might actually be better met in a higher-cost community," Languirand added. "In rural areas, it is not unusual to have no public transportation or the special transportation services that people with lower mobility require."
Pick a centralized location
Choosing a place to retire that is far off or isolated from other towns might not be the best idea. You want to keep money in your savings account, and driving long distances just to go to the grocery or enjoy a night out will cost you much more.
"Retirees are more engaged in areas that have plenty of entertaining things to do."
According to USA Today, some of the couples who interviewed about their retirement location decision wanted a place with various eating and entertainment options as well as cultural opportunities. Retirees often find themselves more engaged in their retirement when they live in an area that will keep them busy and have plenty of entertaining things to do.
Stay close to friends and family
It might not take long for you to start missing your friends and family in the early years of retirement. Additionally, spending a lot on flights and trips back "home" could cost you big time. According to U.S. News & World Report, it's important to keep family and friends in mind with your destination. If not, you should think about being close to a major airport, which will make flights easier and the overall trip more affordable.
Understand which areas are in higher demand
According to Annette Fuller, Where to Retire magazine editor, while there are hundreds of towns retirees choose for their retirement location, 700,000 Americans retire each year, which means the competition is high, USA Today reported. If you're truly set on a few locations, try to see which areas are more popular in retirement communities. Depending on your financial status, you may want to choose somewhere that isn't as costly and popular.
Chris Kahn, research and statistics analyst for Bankrate, explained different locations attract people for certain reasons, but retirees have to be prepared to spend if they choose somewhere with everything they want.
"There are many factors retirees should consider before deciding where to put down their roots," Kahn stated. "Warm weather may be an initial draw, but all the sunny days in the world won't make you happy if you're constantly stretching your budget or don't have access to quality health care."
For more information about smart ways to manage your finances, contact Landmark Bank.
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