Among the popular internet searches for retirees is "best places to retire." It's fun to think about living a new life somewhere different than where you are. Many retirees will do just that—and you may be one of them.
Interestingly, the vast majority of retirees do not find themselves moving after retirement. According to a study based on data from the last census in 2010, less than 6% of people 65 years and older had moved since the previous year. Among those who did move, only 17% had relocated from a different state.*
The most common reason for not relocating in retirement was proximity to friends and family. A home can represent years of happy memories and can be filled with personal items that would be emotionally difficult to part with. If you like where you live now but just need a change or want to escape harsh weather, consider an affordable second home or rental where you spend a few months out of the year.
But if you're ready to make a retirement move, here's how to get started. Make a short list of the places you've dreamed about, and visit them long enough to see what it would be like to live there. Engage real estate agents in each place to show you available properties and answer your questions about the community. The internet is another great resource on just about any place you're thinking of settling. A little research before you make a retirement move can help you find a place to live happily ever after.
One of the most critical factors to consider is the impact on your finances.
- Home cost: Create a realistic budget that takes into account your income and expenses so you don't buy or rent more of a house than you can afford. If you're selling your existing home and downsizing, you may be able to purchase your new home with cash. Getting a mortgage can be more difficult the older you get, but you still have options such as shorter-term or guarantor mortgages. Try this calculator to see how much house you can afford.
- Home maintenance: If you're purchasing a property, make sure to factor in the cost and effort of maintaining the home. Simple repairs you can do yourself now may require hiring a professional in the future. Some retirees move to communities where maintenance is included, but the required homeowner's association fees can be prohibitive. If you don't want the responsibility, consider renting.
- Taxes: Ask about real estate taxes in the new location. This handy resource shows you what to expect in taxes by stateOpens dialog , including how each state treats Social Security and pension benefits, income tax, sales taxes and estate taxes.
- Cost of living: Compare the cost of living in the new area to your current area with this cost of living calculatorOpens dialog .