Picking where to retire doesn't have to be a shot in the dark
When it comes to choosing a good location to retire, look beyond the magazine lists.
“A common error some retirees make is assuming a magazine article listing ‘Best Places to Retire' applies to them,” said Tom Murphy, a certified financial planner at Murphy & Sylvest LLC in Dallas.
“The criteria the magazines use may or may not be relevant to any particular retiree's plans,” he said. “In addition, these magazines tend to evaluate locations based on a very small number of criteria.”
For example, a magazine might judge a town in Florida as a great place to retire because of the weather — but you may not like a hot and humid climate.
Similarly, Murphy noted, “sometimes they judge the lowest state income tax as best without considering property tax.”
Take the case of Texas, which doesn't have a state income tax or an inheritance or estate tax but has one of the highest property tax rates in the nation. What's more, the state sales tax rate is 6.25 percent, but local rates can add another 2 percentage points.
Here are questions that can help you make an informed decision:
• Can you afford it?
Take note of the average price of a home, the area's cost of living and the tax burden on retirees. Calculate your monthly expenses and make sure they won't be a drain on your savings.
“What may appear like a lot of well-earned fun can become a serious burden,” said James Blythe, a certified senior adviser and loan officer at 1st Reverse Mortgage USA in Dallas. “I ask (clients) if they are having to use the principal of their assets to afford to live and not the income from those assets.”
Also, calculate what would happen to your finances if your spouse died suddenly. Will you have enough money to sustain yourself?
“I met a man in a wonderful retirement community with a beautiful golf course home,” Blythe said. “His wife had just passed away, and he lost her retirement pension income as well as her Social Security. That 3,000-square-foot home was causing him to go through his retirement assets like a hot knife through butter.”
The man knew it was a bad deal for him and that he couldn't afford the home, Blythe said.
“But this was his dream home he had worked for all his life,” he said.
Beware of hidden housing costs also, such as taxes, insurance, utilities and maintenance.
• Are services nearby?
Before you buy, determine whether the neighborhood has needed services — doctors, pharmacies, banks, grocery stores, etc.
Does the community have a sufficient number of doctors and health care facilities?
“That's really important — things like, can you get to pharmacies easily?” said Amy Levner, manager of home and family issues at AARP.
Added Blythe: “Too many times I have helped retirees relocate because that lake home was way too far from medical and other services.”
• Too far from family?
Will you have to travel far to see family and friends?
“For many retirees, happiness is in direct proportion to the size and strength of their social network,” Murphy said.
Blythe poses this question: “Is your retirement home going to provide you with the involvement with your family and community?”
“All too often I hear that they (retirees) are spending a lot of money on traveling just so they can see their grandchildren,” Blythe said. “That can cause a lot of friction as well in a marriage. Grandma wants to see the kids, and Dad is tired of traveling.”
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Penguins see Stars, blanked by Dallas in opening game
- Police: Woman, 18, pretended to be student, assaulted Perry principal
- Steelers quarterback Vick getting more acquainted with offense
- Starkey: Pirates gaining bad big-game rep
- Pirates notebook: Fastball command issues hurt Cole against Cubs
- Kennametal HQ relocation rankles Westmoreland County business leadership
- What’s old is new at Toll Gate Revival in Lawrenceville
- School supplies, equipment on the auction block in former Kittanning school gym
- A field day on social media as Pirates’ Rodriguez attacks Gatorade cooler
- Clerical error blamed as Armstrong inmate is released
- Steelers hoping to establish run early against San Diego