ST. CROIX INSIGHTS
4 Questions to Ask Yourself Before Deciding Where to Retire
BY BRETT ANDERSON
Deciding Where to Retire?
Deciding where to retire? I’ve not kept it a secret – during January, February and March since most of my clients are heading south as they retire, that’s probably where you will start finding me. I can work from anywhere as technology continues to improve every day. As I’ve slowly aged, I’m not a fan of the cold and let’s not even talk about the snow; however, the winter of 2015-2016 wasn’t too bad.
As a Certified Financial Planner™ (CFP®) I have an obligation – yes, an obligation- to research the “best” places to retire. I continued my search this February and researched the Gulf Coast of Florida, Sanibel, Marco Island, Naples, Tampa, and Orlando areas. Personally, I like that I can enjoy the outdoors year-round in a warmer climate. Walking on the beach and shelling are two of my favorite activities; however, I’m not sure what to do with all the shells I’ve collected! I keep thinking about what I would do if I moved south either semi-permanently or permanently. Maybe a tourism board will hire me in my retirement years to sell others on the benefits of the sunshine in the winter months?
4 Retirement Questions to Ask Yourself
The four major questions I hear clients ask themselves when deciding whether to relocate include:
- Where are our children, or more importantly, where are the grandchildren located?
- How’s our health, and can we easily get around?
- Can I afford to relocate or purchase a second home?
- What type of taxes will I pay when I retire?
For some, they are going to retire and stay right where they are, which is just fine. Maybe it’s the home they’ve lived in for the last 20 years and it’s paid off- great! Sometimes it might make sense to just get away for a few months, and in that case, you can simply rent a place for $3,000 to $5,000 a month depending upon where you go. There are definitely pros and cons to owning verses renting.
Others will decide to purchase an additional home. My recommendation before you retire is to also have your second home paid off. It will put less stress on your financial resources, and if you’ve read my blog Keeping Yourself Poor, I’m not a fan of a mortgage.
Consider down-sizing in your second home, as it could save you a lot of money and would be another way for you to reach your goals.
Now, let’s discuss the dreaded T word! Federal taxes. It doesn’t matter where you live, it is what it is. However, state taxes and rates vary from state to state. Some states have no income tax, some do not tax Social Security payments, and some do not have an estate tax. Be sure and explore your options, and depending upon your circumstances, one state versus another could be more beneficial to help you meet your retirement and financial goals.
Deciding on where to retire and enjoy your retirement years isn’t always a quick and easy decision. If you’d like to explore your options, let’s talk.
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Ask yourself- can my portfolio support my lifestyle in my retirement?