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If you love it, run the numbers on living there and if the numbers work, make the move. it doesn't really matter what others did or think. I love the climate of much of Cali and the things to do and beauty of several areas of Cali. I tried to get wife to consider southern Oregon or Cali for retirement but the taxes and overall cost of living are a detriment for us as well as our Grandkids in Seattle. We decided to retire in eastern Washington and I plan to stop working within a year.
Didn't live in a "cheaper" state and then move to California like you have thoughts about doing but did buy a Santa Cruz condo recently that now is/will be vacation/retirement home and let me tell you, I really like Santa Cruz; always have but now more than I ever thought I would even though the time spending there is minimal because I"m still in the "rat race".
If it pencils out, you should follow your passion rather than taxes because one should never let the "tax tail wag the economic dog" or their dreams.
Good luck.
I agree. The tax part of the equation I don't think is going to be a make or break situation in retirement. I think some people have "tax" on the brain, and that it simply bothers them more than what the actual cost is. The thought of spending my retirement in place I don't want to be to same what can be a nominal cost for taxes to me seems foolish. When it comes to retirement planning, you have to look at the big picture of costs besides taxes.
I'm far more concerned about the cost of real estate/rent, and if there are other costs to be considered. A friend of mine moved to an area which is basically known as tornado alley, and was shocked to find out he had trouble finding affordable home owner's insurance, because it had tripled from where he moved from. He wasn't prepared for that. Likewise, people move to a state to find out the auto insurance is much higher than expected.
It makes for interesting retirement articles to just focus on one thing like taxes, but without looking at the whole picture I think people are going to be mislead.
I just read an article yesterday on the 15 worst states for retirement. CA was definitely one of them. My own state, NJ, was No. 2 on the list, and the adjacent state, where I work part-time, is NY, which was No. 1. That last part was a bit disconcerting. I receive a NY State Pension, which isn't taxed in NY but is taxed in NJ, so I have toyed with the idea of moving to NY at some point. Might not be a great idea.
It takes into account taxes, cost of living, health care costs, etc.
Please name one state where your property taxes are based on what the prior owner was paying? Everywhere I've ever been your taxes are based on what you pay for the house, not the value of it when it was first built. But with that said, the property tax on our home in Sacramento County about 1.1% and can't go up by more than 2% a year. (PS there are plenty of Republicans in California, there are some very red counties, i.e. Placer County)
You didn't read my post correctly. I mentioned a new person moving to CA will pay more property tax than a potential neighbor in the same neighborhood with a similar house who may have been living there for 20 years and had the advantage of Prop 13 which limits property tax increases to around 2% per year.
You didn't read my post correctly. I mentioned a new person moving to CA will pay more property tax than a potential neighbor in the same neighborhood with a similar house who may have been living there for 20 years and had the advantage of Prop 13 which limits property tax increases to around 2% per year.
That's true but if you were to buy a house in California and you lived there for 10 or 20 years you would be paying less than people just moving in to the neighborhood. That law has allowed many elderly low income retirees to remain in their homes, I don't understand why you see it as a negative.
That's true but if you were to buy a house in California and you lived there for 10 or 20 years you would be paying less than people just moving in to the neighborhood. That law has allowed many elderly low income retirees to remain in their homes, I don't understand why you see it as a negative.
Yes, that is true, but in planning a move someone will need to keep in mind the property tax is based on what they pay for a home and due to higher than average home prices in CA it may be higher than another state in a similar home. Just something to budget for and can be a negative for CA. You need to check this by individual state, but AZ has fairly low property tax and significantly lower marginal state income tax rates versus CA.
Santa Cruz, like the Bay Area, is definitely very blue and liberal but you can do what I do and pinch your nose and close your eyes while enjoying this wonderful beach-community lifestyle. Nobody is putting a blue gun to my red head forcing me to buy into their nonsense.
There is a lot of surface-road traffic and the highway traffic is also horrible. Real estate prices are ridiculously high. It is a university town so you have to deal with all the young students having, for the most part, innocent fun not realizing that it won't last and one day they'll be in the rat race and probably not in Santa Cruz due to the high cost of housing.
Wife and I talked to a young woman who had graduated from UC Santa Cruz. She had three part-time jobs and lived with her BF happy that after a long-wait they found a small 1-bedroom apartment for slightly under $2,000 a month.
You didn't read my post correctly. I mentioned a new person moving to CA will pay more property tax than a potential neighbor in the same neighborhood with a similar house who may have been living there for 20 years and had the advantage of Prop 13 which limits property tax increases to around 2% per year.
Quote:
Originally Posted by 2sleepy
That's true but if you were to buy a house in California and you lived there for 10 or 20 years you would be paying less than people just moving in to the neighborhood. That law has allowed many elderly low income retirees to remain in their homes, I don't understand why you see it as a negative.
jgustav was stating what you are stating ... that people MOVING to California will pay a higher property tax rate than those who have been in a like house/neighborhood for 20 years. That is the part of Prop. 13 that is relevant to anyone thinking about moving there (the topic of this thread).
Unless your income is higher than just "expenses" from a IRA or 401k, the income tax isn't necessarily killer - but I did maintain my former state residency nonetheless, (even though I spend 8 months in CA annually)... I simply own a small condo there - just for that.
Property tax in CA is pretty average, and unlikely to change. Otherwise, CA is CA. The lights still go on when I switch them on and the roads are in good shape. Santa Cruz is lovely; wonderful climate. Real estate is very expensive in CA and I predict will get more expensiver as time goes on - so don't dawdle. Just remember - if you actually earned that money through your own efforts, you can't take it with you.
And remember, the day you die, in fact the instant you die, everything you own suddenly, and instantly, is of no further concern to you.
Last edited by TwinbrookNine; 11-18-2016 at 01:08 PM..
I'm assuming this holds true mostly for the 5 Boroughs, Long Island, Dutchess and Westchester Counties? Are the taxes better in upstate NY?
I can tell you for sure that all of those areas, including Long Island where I live, are expensive. I can also tell you there are some advantages to the high costs. I live near the financial, art, music and cultural center of the world. I can pay whatever I want, or nothing, and see some of the greatest art works at the Metropolitan museum. I just visited Lincoln Center and paid $20 to attend a "rehearsal" of the NY Philharmonic. I pay $330/year and can walk a mile to attend up to 12 semester long courses geared towards retirees. I even have plenty of opportunities for low cost, outdoor activities including two of my favorites, 3d archery and surf fishing.
When I retired, we sold our house, moved into an RV and traveled throughout the US. We had planned to relocate but ended up back on Long Island. We never found any place we could afford to live that offered more.
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