Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Since we plan to relocate to WA from NY, I have been checking and comparing all the taxes between the two states.
I don't remember exactly where you live in WA but from what I have seen, property values in big west coast cities (Seattle, Tacoma, Olympia, Vancouver etc.) and surrounding neighborhoods have gone up quite a bit in the last several years. Note: I started looking into relocation in Vancouver/Camas area 2 years ago and have been watching real estate cost in the area. My impression is that house values have gone up 20-30% a year. New houses are required to build on small lots to prevent urban sprawling. So I am not surprise to see that if one owns a nice home with great view on big acreage lot has to pay quite a bit in property tax.
From what I have read, WA population has also increased quite a bit especially in these cities. A number of my friends and/or their family members have moved from NY or MA to Seattle or Vancouver in the last few years. So it's not a surprise to see increases in property taxes due to appreciated real estate values and more demands for services.
Washington does not levy income tax so the revenues have to come from somewhere to pay for services.
It's a good thing that cities like Seattle have attracted quite a few of big businesses. This helps to bring in revenues but the state can not impose heavy tax burden to businesses or they will move to either other states or shift jobs abroad.
When one is working, one does not have many choices in where to live. You have to go where a job matching your skills and education exists. This is even harder for married working people. If you have kids or plan to have some, you also have to pick a city or town with good education system and this means higher property values and taxes.
The biggest advantage of being retired is that you can choose where to live. Some put high priority on family ties. Others value friendships, support system, local amenities, good weather etc.
There is no doubt that cost plays a big part in relocation decision. If one can not afford to live in an area or think that the high COL not a good trade off for living near families or in good weather, one can move to a lower COL town or state. For those who are lucky to own properties in highly appreciated area, they can pocket a tidy sum by moving.
It is a different story for working folks or retirees when property taxes increased due to higher assessed values. People in both cases can sell their houses, lock in the profit and move to a lower tax state. It is just more difficult to move for working folks.
I'm near Olympia and did the same as you are doing...
Extensive research and I-747 which is the Washington State version of California Prop 13 is what swayed me... I realized taxes would be subject to limits...
As mentioned... no sooner than I-747 was overturned my property assessment increased 80%...
Of course you can protest... but my idea of retirement is not never ended tax appeals...
I don't have any pension so Income Tax really isn't a huge factor for me... being able to afford my home is.
This is a bit simplistic, isn't it? If everyone just lived with what they needed and not wanted, then everyone would only have the same basic lifestyle regardless of income, and any "extra" would be saved...for what? Not everyone has the intelligence or foresight or planning skills or maturity or market skills or luck or whatever may be required to proportionally balance or allocate the right amount to living and the right amount to saving. No one knows how much income they may have in the future, anymore than they will know how long they live.
I understand what you meant to say. That always allocating a portion to saving so that you never depend on that amount for living, in essence live like you make say 80% of what you do, (ie, the classic live below your means) so that when you retire the saved amount allows you to continue living on that same (inflation adjusted) 80%. It's great in theory but difficult in practice. Health or job loss or divorce can decimate that savings to the point where you may be forced to live well less than the 80% level you were previously comfortable at. There are no sure things, or sure jobs, so the SMART path would be to establish a retirement income plan that you predict will be acceptable to you, and try to follow it. This forum proves how truly difficult that alone is, much less actually achieving it.
When I was in my 20s and a well earning young degreed engineer, I thought I had it all figured out. And then again in my 30s. And each time it turns out I wasn't even close, and grossly underestimated inflation and income growth, every bit as much as my success in the last 15 years of my career, or the setbacks from the housing collapse, divorce, and market crashes were.
When I was in my early 40s and making $60k/yr, I could see I was on the path to saving enough to retire on that as an income. But when I got there, I was already used to living better. And so on and so forth. If I wanted to live on $60k a year for life, I could have retired 3 or 4 years ago, with a much smaller pension, health care just by selling my house and buying smaler in a lower cost area and with enough savings to make it to SS @62 and still enough left over saved to continue that way. There's nothing wrong with that, and if I hated my job, or health reasons forced it, it was a comfort to know that I had "made it" that far.
And while it may sound pompous or like humble brag, the truth is, once I got to that point, it was not enough. I read all the "retire early and do your own thing" articles lime MMM , etc, and their lifestyle is absolutely not what I wanted. It was way too much work to live frugal like that. It was far easier to keep making a great salary and sock away ah higher amiu t and higher percentage each year than do all that! So each year I ratchet what's acceptable or what I really want up another notch to a point where I really think I will not be disappointed with my self and my life. As of now, I keep saying at 62 I'll be done, as I don't want to OMY myself to the grave.
I know there is significant rambling here, but my point is no one can tell you how, where or when you are being true to yourself. Everyone is totally different. One mans wealthy is another mans average and another mans poor. The worst things you can do are be obsessed about living frugal and passing up the good things in life, or just as bad, obsessed with success, and let it rule your life. There is a happy balance that only you can find and just try to get to. There are no guarantees but it pays to be aware of the power of planning and the impact of not doing anything. Any more than that, and it becomes an endless debate.
This. Plus despite what I've read from some earlier in the thread, dollar cost averaging (low cost index funds). Cheers,
D.C.
Humble brag is where one says something like "I'm a very conservative investor. And not very good at it, so I've only been able to average 15% a year in the stock market. Thanks to that, I only have $2.5 million. If I was any good, I would be rich."
In my case, I consider myself a down to earth person, I came from a relatively non successful family background (but in Westchester County, NY, and Fairfield County, CT, two very expensive and upper income counties) and I don't have any desire to live high off the hog. But my minimum standard for income in retirement to live my view of down to earth is greater than say $70k a year, with a paid off house and no debt. Clearly, that is more than the average person will have in retirement. I think that amount is nothing to be overly proud of, which comes across as a humble brag.
Humble brag is where one says something like "I'm a very conservative investor. And not very good at it, so I've only been able to average 15% a year in the stock market. Thanks to that, I only have $2.5 million. If I was any good, I would be rich."
In my case, I consider myself a down to earth person, I came from a relatively non successful family background (but in Westchester County, NY, and Fairfield County, CT, two very expensive and upper income counties) and I don't have any desire to live high off the hog. But my minimum standard for income in retirement to live my view of down to earth is greater than say $70k a year, with a paid off house and no debt. Clearly, that is more than the average person will have in retirement. I think that amount is nothing to be overly proud of, which comes across as a humble brag.
Anything along those lines.
Is that a perspective held by people with money like that or without? Seems like a statement of fact to me especially if finances and investing are the topics up for discussion. If there is humble brag is there the other side which would be called? You know the drill. 2.5 million at a 3% draw down along with SS might be in the income range you are shooting for. Wouldn't your 70K plus be a humble brag to someone living on 15K? Yet it is your reality. If a frugal person with limited means can discuss their reality why can't everyone else.
Who came up with it anyway? Do you know? Is it forum specific or did it make its way into the forum from the real world. I say that way because sometimes I think not everyone's real world is allowed in here.
If you participate in a thread like this one expect people to give the perspective that a million isn't enough and be personal just like the folks who say they get by on much less and give their numbers.
LOL!! Well thank you! I got a real chuckle out of that. I agree with you. You've been here way longer than I, and know that there are all kinds of discussions regarding "needed" finances vs luxury. There are posters that doubt the success that some are posting about. There are people that believe that a million dollars saved is ludicrous, unachievable or unrealistic (unless one is truly wealthy or lucky, which I feel is simply not true) and I suppose are offended that their belief that their "perfectly adequate" financial situation may be in jeopardy.
I agree that I shouldn't have to tiptoe to avoid offending someone on a forum when we discuss finances. I am not concerned at all with others situations, to be honest, unless they provide me with information that I can utilize. But those that are living basically off SS entirely with maybe a small emergency savings have to believe that they are fine for life, and any suggestion otherwise is met with hostility or indignation at some level. Hence the "humble brag" accusation. Which has been leveled at me (only here), but I have heard the term before; it did not originate on C-D Retirement. I should just ignore it.
It is not the dollar amounts per se, that are the origin of the "brag". No one is ignorant enough to think that no normal person COULDN'T have 1 or 2 million. There are about 5 million housholds in the US out of a total of 116 million, with a net worth of $1M or more. So 4.3%. A small number. But when you word it as "1 in 20 households have a net worth of $1M or more", then it doesn't sound as small, does it? And thats not anywhere near say the really wealthy of $20M and up which is a tiny 66,000 households, or .05%, about 1 in 1800.
It is when someone says "All it takes is ...., you can get there." That is what upsets people. Because indirectly one is saying that they did not do the "All it takes is....", and they could have, but didn't. There are a thousand life reasons that can prevent it from happening and everyone knows that. But the same people post time after time that "Not everyone is lucky like you" or "People get sick, laid off, can have an illness you know ", so STOP saying "All you have to do". Well, duh, we ALL know those obvious caveats, and there is zero reason to keep repeating them over and over. When we discuss "All you have to do" we mean for people that it IS perfectly possible for, they just don't because they have a million excuses that are XYZ.
A thread like that is not for someone that never made more than $30k a year. Why would they think it would be? If you lived just above the poverty level of $30k/yr, why on earth would you expect that a leisurely secure retirement was possible? It would take extreme frugality or unusual luck for that to happen. Most that are in that situation here realize, understand, and accept that. They simply are looking for more helpful information to aid them. That's fantastic. The fact that 50% of the US survive on $30k a year or less, is irrelevant. They are working in their prime years to get through life on that. How can some possibly imagine they are able to secure a 30-35 year existence of not working at that same level in retirement? And I mean people with enough intelligence to be on a forum here to discuss it, not some totally uneducated person that drifted through life.
Thats where the friction occurs.
Last edited by Perryinva; 01-05-2017 at 03:39 PM..
I am curious if Perry can give his numbers why can't everyone else who wants to? Is this a minimalist forum?
Some people are very reluctant to give out their financial numbers for a number of reasons:
1) Higher than average numbers can elicit negative comments/reactions such as 'humble brag', 'elitist', 'snobbish', 'arrogant' etc.
2) Lower than average numbers can also elicit negative comments or statements of disbelief, doubts, ridicules etc.
Some people can be envious, jealous or just plain sarcastic or skeptical. These attitude ruin the spirit of sharing, learning but it is just life.
I had given out my numbers for various things such as food budget, living expenses etc before and it appeared that some people did not believe my numbers. So for whatever it's worth, I am reposting some information here relating to retirement expenses and income estimates I made in 2015 before deciding to retire.
---------
1. Projected annual expenses: $40K ($24K non-discretionary and $16K discretionary spending)
2. Projected retirement income (SS+small pension+annuity - not including investment income and RMDs): $50K in <2yrs, $67K in <3 years and $93K in <7 years.
If I add say $5K to $40K to account for Fed/State tax, the needed pre-tax income will come out to be 90% then 67% and 48% of the expected 'fixed' income. This means that we are not likely having to touch our savings for any 'standard' needed expenses and can even spend more or save more down the road.
-------------
Note that we have some pensions but they are relatively small. My husband gets ~$400/month from a job where he worked 5 years. He worked at the previous job for 9 years but did not get any pension (at that time, one has to work 10 years to receive pension). The two last jobs only had 401K and no pensions.
I only have a sort of a partial pension. The company changed from defined benefit plan (pension) to defined-contribution plan (401K). I elected to receive this 'prior pension plan' amount to annuity which will be around $1K/month.
This year, my husband starts receiving his SS after turning 70, he will receive ~$2,750/month.
The small pension, annuity and my husband's SS add up to ~$50K retirement income this year.
I am curious if Perry can give his numbers why can't everyone else who wants to? Is this a minimalist forum?
I have given my ballpark numbers in the past and they happen to similar to Perry's - except I'm a little younger, though not much.
Sometimes it seems like the people who succeeded in planning for their retirement or are well on their way to achieving their goals are zinged as braggers on this board. When reality is quite a few (most) worked hard, saved, invested and made good decisions.
I've seen where MJ mentions growing up in public housing in NYC. I was on the free lunch program in the NYC public school system. I just got through posting on the NY board about the proposal to provide free college tuition in NY State. - I said it's hard for me to complain when I got to got to college for free at CUNY. In turn I got a good job, worked hard, continued my education, advanced my career and last year at the age of 56 hit the unreachable 7 figure retirement saving mark.
If that's an unrealistic plan someone should have told me earlier.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
