We all love reading lists of the best places to retire. They interest us and they make us think about what is possible in retirement.
Should you relocate? Or, is staying put one of the best places to retire?
Why Relocate for Retirement?
Days in a hammock on the beach? Fishing mountain streams? Long afternoons with the grandkids? Where you live in retirement will determine what you will do and with whom, which are big factors for your well being.
Where you live is also a huge financial consideration. Might relocating enable you to spend less? Release home equity? Reduce taxes?
There are lots of reasons to think carefully about where you’ll live in retirement.
Here Are Some of the 2018 Best Places to Retire Lists
Best Places to Retire in the United States:
Kiplinger: Kiplinger looked at cost of living, poverty rates, well being scores, population data and retirement taxes to identify 50 communities throughout the United States.
Forbes: Forbes Magazine identifies 25 places which they “believe offer excellent retirement value—that is, a high quality of retirement living at an affordable price.”
U.S. News and World Report: to identify the best places to retire, U.S. News looked at the 100 largest metropolitan areas. The top criteria used were: “the happiness of local residents, housing affordability, tax rates and healthcare quality. ”
Retirement Living: Retirement Living has identified five off the beaten track communities that stand out as great for retirement.
Bankrate: Bankrate ranks all 50 states for retirement. Number one? South Dakota. The worst? New York.
WalletHub: WalletHub has different results about the best states for retirement. Their number one? Florida. The worst state to retire? Kentucky.
Quirky Retirement Locales:
- Explore AARP’s list of quirky places to retire.
- Lake Weir Living in Florida specializes in homes with unique garages for retirees who love motorcycles, RVs or classic cars.
- Here are the best surf towns in America and abroad.
- Research the best value golf courses in America.
Best Places to Retire Abroad
U.S. News: U.S. News had identified 10 global locations that they consider ideal for retirement.
International Living: Quoted in Time, Money Magazine and most of the big publications, International Living is considered the expert on retirement abroad. International Living grades countries on 8 different criteria.
Bankrate: Bankrate has identified 10 cheap places to retire abroad.
Live and Invest Overseas: Lists and tips for retirement around the world.
NewRetirement: Explore some unexpected places to retire abroad.
Blue Zones: Explore the “Blue Zones” — places where people live the longest.
If retirement abroad interests you, here is a 5 step plan for making it happen.
Best Places to Retire if Healthcare is Your Primary Concern
Commonwealth Fund: This site has easy to use charting that lets you click on a state or county and see the ranking for how well healthcare is performing in that area. In 2017, Vermont has the best overall ranking.
10 Best States for Medicare Advantage: Services that are available through Medicare Advantage vary greatly from state to state. This may be a factor in your where to retire decision. You can also check out which states have the best Medicare Part D plans.
International Medical Group: If your best place to retire is abroad, you won’t be able to use Medicare. Be sure to find out if you can opt into the local plan or what private insurance will cost. International Medical Group offers plans. Or, you may find that healthcare is much more affordable and you will be able to pay for services in cash.
Despite All These Great Places to Retire, Most of Us Want to Stay Put
Despite the popularity and proliferation of the best places to retire lists, most of us stay put in our homes for retirement. According to the U.S. Census Survey data, very few seniors moved between 2014-15:
- 6% of 55 to 59 year olds relocated
- 4.5% of 65-69 year olds relocated
Why don’t more of us try something new?
Here are seven of the real reasons why we either move or choose to stay in our homes for retirement.
1. Friends, Family and Community
What is more important in life than relationships? Most of us have established close friendships in our existing communities and we do not want to lose those connections.
Sometimes though our families have moved away. And, this may be a strong motivator for those of us who actually do move in retirement. A 2012 AARP study found that 80 percent of adults 45 and older believe it is important to live near their children and grandchildren.
A Merril Lynch study found that nearly 30% of relocating seniors say that their reason for moving is to be closer to family.
2. We Like What We Know
It is not your imagination, science has found that we become less open to change as we age. And, moving is one of the biggest changes we can experience.
In your current home, you probably have everything dialed in the way you like it. Do you really want to figure it out all over again?
The Center on Budget and Policy Priorities has extensive research that finds that state taxes have a negligible impact on interstate moves. As many people move to low tax states as move to high tax states and a “miniscule share of people report that they moved because of taxes.”
The data suggests that people do not move to improve their tax situation.
Taxes, in reality, are very complicated. For example, some places are better for income taxes, but you pay more in sales taxes. Therefore you want to be vigilant when moving for tax purposes.
4. Home is Where the Heart Is
Our homes hold so many memories and so many hopes for the future. Some of us originally bought our homes with dreams of special occasions with family. We have experienced so much in our homes and we may want to continue those traditions.
We dream of grandchildren around the fireplace or in the backyard.
5. Moving is Stressful and Can Be Expensive
Downsizing is possible and can be a really good move for your retirement finances. However, relocating is not always a money saver. Finding a home that costs less than where you live can be difficult, and moving costs, sales commissions and upgrades can be costly.
However, if moving to one of the best places to retire entices you, it might be worth it.
Too often our homes are less about where we live and are more about being a storage facility.
We often have a lifetime of stuff in our homes and many people don’t want to move because they simply don’t want to deal with all of their furniture, heirlooms, books, knick-knacks, photos, clothes, papers, etc…
However, the best selling book, “The Life Changing Magic of Tidying Up,” suggests that decluttering brings joy. Joy is a good goal for retirement and purging stuff from your life might make a move possible.
7. Familiarity with Existing Healthcare
Most of us have been with our existing doctors for quite some time. It can be scary to think about starting from scratch. However, healthcare quality and costs vary greatly across the country and world.
So, Should You Stay or Should You Go? What is Really Best for You?
Where you live is a really important and serious consideration for your retirement.
- Housing is usually your most costly expense and most valuable asset.
- Housing and your community has a huge impact on your overall quality of life.
Here is a five step process to figuring out what is best for you:
1. Assess Your Goals for Retirement Before Searching for the Best Places to Retire
Lists of the best places to retire are fun to read. And, they do highlight very important considerations like healthcare, cost of living and more. However, those lists aren’t designed exclusively for you.
If you are considering relocating for retirement, you should probably start by asking yourself questions like:
- Why am I looking to relocate? What is wrong with your current location?
- What do I want out of a home?
- Who do I want to spend time with? If the answer is near your grandchildren, then you might prioritize locales near where they live. Is it important to you to live near like minded people or in a more diverse environment?
- What do I want to be doing? Some passions like surfing or skiing are location dependent.
- What legacy do you want to leave? Will your location enable you to fulfill what you want to leave behind?
- Where do you want to live vs where do you want to travel? Sometimes people confuse a great travel destination with a great place to live. Assess the differences for your own values and how you expect to spend your time.
- Are you downsizing or upsizing? (Downsizing is popular in retirement as a way to cut expenses. However, nearly one third of retirees actually upsize.)
- How important is healthcare quality and the costs of those services?
2. Examine Your Finances to Determine the Best Places to Retire for You
Perhaps the MOST important criteria for determining the best place to retire, is assessing what you can really afford.
Most people are not as prepared for retirement as they would like to be and housing is usually the biggest cost for any household. If you currently own your home, it may also be your most valuable asset. So, the decision of where to live is hugely significant for your finances and could make or break your budget.
You might want to consider using a Retirement Calculator to determine what you can afford and try different scenarios.
The NewRetirement retirement planning calculator makes it easy to try different retirement housing scenarios.
- Start by entering some initial information and then see where you stand.
- Then, try different what if scenarios. What happens to your retirement finances if you relocate to a more affordable home. Upsize to your dream home? Would you consider a reverse mortgage?
- The NewRetirement tool also let’s you also look at the zip code comparison information to compare financial averages.
3. Get Creative — Think Outside the Box
Maybe your ideal retirement destination is too expensive, have you considered thinking slightly outside the box regarding your housing?
Trailer Parks: Time Magazine recently featured a story about how trailer parks are “The Home of the Future” — particularly for retirees. Charles M. Becker, an economist at Duke University, says: “Trailer parks can be thought of as gated communities for people who aren’t so wealthy.” These communities often have tons of amenities — golf courses, swimming pools, tennis courts and more — that may be very appealing to retirees.
Tiny Homes: The tiny house phenomenon might be another way to make an expensive locale more affordable.
Housesharing: Getting a room mate is another way to increase affordability of certain locations.
4. Use Best Places to Retire Quizzes and Calculators
Instead of reading lists using other people’s criteria for the best places to retire, why not figure out a location that is really the best for YOU.
Here are a few best quizzes and calculators to help you determine the best places to retire:
International Medical Group: This interactive tool that allows users to customize a list of perfect retirement destinations. The tool determines the cities and towns that best match your criteria: including weather, low crime rates, proximity to entertainment, and access to health care.
Bankrate: The Bankrate tool is kind of hard to find on this page, but it lets you rank 10 criteria and will identify U.S. cities that would be good for your own retirement.
Best Place to Retire: This site offers a calculator that asks 12 questions to help you find the best place for you to retire. Activities and amenities are well covered in this search. The results are nice in that they give you a lengthy list of options to compare.
Sperling’s Best Places: The questions in this calculator include taxes and cost of living and the quiz is quick and easy, but you are only given one result.
TheEarthAwaits: If you have ever dreamed of living abroad, this is an extraordinary site. There is so much information about so many different destinations.
ExpatInfoDesk: The Expat Info Desk is owned and run by a team of expatriates. Each one of them has successfully relocated to cities throughout the world including Russia, Ukraine, Poland, South Africa, China, USA and India. The site offers articles, guides and a forum. The concept here is good, but it is unclear how active the user base is. You might be better off visiting a travel web site like TripAdvisor that has so many users.
5. Visit First
You don’t need to — nor should you — decide where to retire today. Figuring out the best place for your retirement can be a fun years-long project.
Do some research, take some vacations to your targeted destinations and then try it out for a longer period of time.
You could rent out your existing home using a service like Airbnb and give your target destination a six month trial.
Check if packing up or staying put is your best option
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