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Old 03-05-2019, 12:35 PM
 
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all those reason you gave are ours .plus i work one day a week in retirement ..i would have to work 4 days in the poconos to earn that .the cost of living really was not that big of a difference for us ..

plus we ran out of things to do daily and the winters were long and cold with little to do
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Old 03-05-2019, 01:24 PM
 
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Main reason to live and work in a HCOL area like NYC is the ability to earn more and put more away in an IRA or 401K during working years.

Main benefits to downsizing and moving to a Lower COL area in retirement were:
1. Smaller newly renovated house = easier to maintain, lower utilities costs, and easier to clean.
2. Availability of relatively low cost yard service (about $100 a month year round) to cut grass, trim bushes, remove snow and leaves, clean the gutters, etc.
3. Single story home was easier on the knees than our previous multi story home.
4. Quieter neighborhood atmosphere and bigger lot cuts down on noise from the neighbors and the streets.
5. Less crowded makes it easier to get to doctors, shopping, amenities, etc.
6. Large reduction in NYC city/state income tax, moving to NJ from NYC. As seniors over 65, our NJ income tax rate is about 1/3 of 1% of gross income.

Only downside was higher property taxes, but more than offset by all the other savings.

Back to the OP's question...

My cousin lived and worked and retired in Portland, Oregon. She was concerned about eventual increases in rent surpassing her retirement income. She just recently applied for and got subsidized status in a very nice 55+ apartment complex downtown. Her rent is tied to her income and cannot exceed a fixed % of her annual income. Some tenants are subsidized and some are not depending on their annual income and assets.

My Mom lived in a similar housing situation in Reno, NV, although her rent wasn't subsidized because her income and assets exceeded the limit. However many residents in her complex were subsidized and there was no difference in housing or amenties for the subsidized and un-subsidized tenants.

Last edited by bobspez; 03-05-2019 at 01:42 PM..
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Old 03-05-2019, 01:37 PM
 
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all i know is we have a 6 figure retirement income in nyc and my total ny tax bill was around 500 bucks .

so much is exempt from ny tax and nyc tax ...

our ss , my wifes pension , all our interest from treasuries , our ira deductons the first 20k in retirement money and we get a 1600 dollar tax credit for having a ny state long term care partnership plan , plus nys has a 16k standard deduction .
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Old 03-05-2019, 01:58 PM
 
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At 65+ this is pretty much the same as NJ. Would this have held true from 62 to 65?
Quote:
Originally Posted by mathjak107 View Post
all i know is we have a 6 figure retirement income in nyc and my total ny tax bill was around 500 bucks .

so much is exempt from ny tax and nyc tax ...

our ss , my wifes pension , all our interest from treasuries , our ira deductons the first 20k in retirement money and we get a 1600 dollar tax credit for having a ny state long term care partnership plan , plus nys has a 16k standard deduction .
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Old 03-05-2019, 02:02 PM
 
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we were selling off some real estate from 62 to 65 so this is our first year based just on our income sources
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Old 03-05-2019, 04:04 PM
 
3,613 posts, read 2,566,308 times
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Quote:
Originally Posted by k374 View Post
This is for those that are in HCOL areas and can't afford to buy due to astronomical prices and wanting to stay within conservative affordability metrics.

Do you intend to retire in the same HCOL area or move to a LCOL area ultimately? Since I see some LCOL areas rapidly rising in price as well (Atlanta, parts of Florida etc. - this may be temporary I don't know, a similar rise occurred prior to 2008 and then these areas crashed spectacularly but that is another issue)... are you pursuing any sort of strategy to lock in fixed housing costs in retirement just in case housing inflation does not abate?
We did this in 2008. We moved from southern CA to SC when we were 50. Bought a larger home in a nice neighborhood next to the hospital and doctors' offices. Our payment is less than the rent on a one bedroom apartment where we used to live. We are self employed, still working, plenty of things to do here. Very happy with our decision and two of our grown children followed us here.
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Old 03-05-2019, 05:31 PM
 
18,288 posts, read 12,996,224 times
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Quote:
Originally Posted by foodyum View Post
Generally I agree with you. But you will lose with out with deductions for student loan interest,
Thatís simply a fraction of a dollar spent given back to you

Quote:
Roth advantage
So utilize a backdoor Roth and/or after tax non Roth contributions

Quote:
possible financial aid for higher ed
Thatís a very limited resource

Quote:
mortgage interest deduction on 750+, medical bill thresholds,
Fair points only if you spend more than 750k now

Quote:
ira savings deduction and any other advantage given to lower earners
And how much is that worth? When actually quantified most would take more income over deductions

Quote:
. Iím not even counting entitlements that are federally based. Heck, if you can get in to that eic zone because of a super low col then even more power to you. I think if your on the low end of wage earners your better off in a low col area.
Iím not sure this conversation is all that pertinent to EIC eligible folks
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Old 03-05-2019, 05:41 PM
 
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Quote:
Originally Posted by mathjak107 View Post
plus we ran out of things to do daily and the winters were long and cold with little to do
One of my worries. In retirement I want to go out and do stuff, not sit home knitting.
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Old 03-06-2019, 08:25 AM
 
12,852 posts, read 6,724,545 times
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Quote:
Originally Posted by YorktownGal View Post
We are waffling all over the place. Florida, NYC, Delaware or Portland ME? We have two years to decide.


Quote:
Originally Posted by YorktownGal View Post
One of my worries. In retirement I want to go out and do stuff, not sit home knitting.

I was going to comment on those locations since they're so diverse. That's as unrelated a list as I've ever seen.
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Old 03-06-2019, 10:33 AM
46H
 
916 posts, read 536,217 times
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Quote:
Originally Posted by k374 View Post
My point is that housing even in cheap areas is inflating at a 6-7% per year rate which is far more than inflation or even the forecast for the stock market. You need to get a real return in stocks of 7% to keep up with current Real estate inflation which means a pre tax + inflation return of something like 12% which is impossible. So the strategy of accumulating wealth in a HCOL and then buying something in retirement in a LCOL may not work out.

Example - Tampa, FL: 2012 median home price was $85,000, currently it is $220,000. Granted 2012 was the bottom of the Real estate crash but the forecast for Jan 2020 is $233,000 which is a 6% appreciation from today.

Extrapolating that to 2030 @ 6%/year the median in Tampa, FL would be $425,000. This would result in taking an expensive mortgage in retirement which would not be feasible. If one has a $1M portfolio generating 4% it would be unsustainable to service a payment on that.

https://www.zillow.com/tampa-fl/home-values/

You are failing to account for the cost to purchase and maintain RE property -transaction costs/mortgage/heat/electric/water/security/property tax/HOA/maint, etc. You also would have costs associated with visiting the property. In contrast, if you invest the same down payment in stock funds and make similar contributions to the stock funds over the same time period, you will have much more money investing in the stock with the added attraction of minimal costs.


The other issue is your needs and desires will change over time and then you might be stuck with a property in the wrong location for you.
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