Should I stay or should I go? Many people nearing retirement grapple with this decision. Choosing whether to retire “in place” or move to a new location could make or break your nest egg. There are many factors to consider, from expenses associated with the relocation to your cost of living in a new place.
For many baby boomers, Florida often ranks at the top of the list of the most retirement-friendly cities in the nation. But would you consider moving to Grand Prairie, Texas, or Overland Park, Kansas? A new WalletHub survey of the 10 best cities to retire puts both places on the list, after reviewing data in five categories—affordability, jobs, activities, quality of life and health care—for 150 of the largest cities in the U.S.
These are important categories, for sure, but there are other factors to consider before you move.
Cost to Sell
After paying the real estate agent’s commission, fixing up your home on your own or hiring a professional to do so before you put it on the market and paying lawyer fees and other expenses for the sale, you could wind up spending about 10 percent of the purchase price of your house in order to sell it.
Cost to Buy
Your mortgage, if you get one, will likely be your biggest expense. Even if you pay cash for the new house or condo, there are lawyer fees, title insurance, inspections and taxes. Consider the travel costs to visit properties in the new locale or even the cost of renting for a few months to determine if you really want to buy.
How friendly is the financial climate in the state? Your tax burden can vary widely from one location to another. Why do so many retirees move to Florida? It’s not only the weather. Seven states—Florida, Alaska, Nevada, South Dakota, Texas, Washington and Wyoming—have no state income tax. But don’t just move for tax reasons. Keep in mind, that if you live part time in both places you may have to keep track of days you spend in each state and pay taxes accordingly.
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Friends & Family
You may find you hate Florida if all of your family and friends are in New Jersey. When it comes to your decision about whether and where to move, “the biggest questions are going to be the intangibles, especially support systems,” said certified financial planner Carolyn McClanahan, founder of Life Planning Partners. Make sure to consider the support systems—whether it’s family, friends or facilities that offer great health care and long-term care as well.