Today let’s look at the financial costs to retirement relocation that needs to be considered if you are pondering the question whether to stay put or to move to greener pastures when you retire.
Cost of housing is a factor, maybe one of the largest, if you need to keep an eye on your nest egg. And who doesn’t? I wouldn’t think most people would relocate from a less expensive area to a more expensive area, it’s probably the other way around. Unless it is to a resort area maybe. Consider how much you can get your current home and properties if you are an owner. More than one person says it is a great idea to rent first in the new location, just to see if it going to work out for you before you buy. If you buy right away before learning the area and then need to move, then the property selling expenses could be a huge expense.
Proximity to family and friends. This certainly is a major consideration, if not financially, then for other obvious reasons. This might be proximity to children, which is the case many times, or proximity to a parent(s). One second thought, I guess there is a financial considerations with the cost of travel for visits, having to hire a nurse or sitter in case of medical emergencies when you can’t be close. etc. Having relatives close by to help you out on occasion saves you money too.
General Cost of Living: You can get this info from the Census web site. On your visits to scout out the new area you will observe how the routine daily expenses compare to your current location.
State and location property taxes: If you buy, then this should be looked at as a significant financial consideration. Another factor to consider is does the new location have an school property tax exemption for seniors?
State and local Income Taxes: This has traditional been a major factor in relocation to Florida and other states with no state income taxes. However now many states have tax benefits for seniors. Georgia has an exclusion for retirement income.
Weather and utility cost: Compare average utility costs and which utilities are needed.
Insurance costs may vary. When I moved from the metro suburbs to a small town I found my car insurance was higher. You would think less traffic would mean lower car insurance costs, but it’s the opposite.
Eating out may be cheaper in a small town compared to city or suburbs.
Entertainment. If you retire to a small town you may spend more of your time enjoying outside activities. If you move to one of the Active Adult Communities, many activities are included. This may be a savings. Senior Centers also have many free activities and these days many are very nice.