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Old 11-22-2016, 04:08 PM
 
Location: Washington State
18,459 posts, read 9,554,421 times
Reputation: 15750

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Quote:
Originally Posted by bpollen View Post
My choice (I'll make up amounts, to give a sense of it all)::

Retirement city #1 (city of 125,000): House $240,000; Property taxes $2,000 more a year; No freezing of value or taxes at age 65, but an extra $10k exemption; Cost of living about 0.87% of national avg.

Retirement city #2 (city of 100,000): House $275,000 (for a somewhat comparable house); property taxes $2,000 LESS a year than city #1; Value of house frozen at age 65; Cost of living also about 0.90% of national avg. Also has $1,000 higher cost homeowner's insurance, and a small ($500 or less) state income tax.

Health care is less expensive in city #1. This is figured into the COL, but I wanted to single that out, since it's important to seniors. There is also more health care locally w/o going to a nearby big city. So their COL is about the same, but they are pricier or less pricey on different things.

Your choice would be......?????
Income taxes I would have to pay in that state would be my determining factor but I wouldn't want to live in such a small city. I have decided to retire in Washington state (no state income tax) and plan to do so within the next year.
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Old 11-22-2016, 04:13 PM
 
2,975 posts, read 2,701,897 times
Reputation: 5627
Quote:
Originally Posted by RiverBird View Post
Why not a less expensive house or condo in City 2? If you're 60 or older, that may prove a good idea. As you age you need less space and amenities that you have to keep up or hire out for.

How much space do you really need? To me, location is more important than size of home.
Because back in post #11 the OP stated he wanted a garden and fruit trees.
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Old 11-22-2016, 04:15 PM
jw2
 
2,028 posts, read 2,631,579 times
Reputation: 3358
Quote:
Originally Posted by james777 View Post
So Texas has high property taxes and high homeowner's insurance rates. Is it worth it just to avoid the state income tax?

I am paying under $700 a year for a house valued approximately $375,000 in Maryland. I suggest you look farther if you are basing this move on saving money.
It depends how one has postured their retirement. If it is low income/low expenses, then the no income taxes but high property tax states do not work very well. States with income tax can work better

As an example, people in California buy houses, pay them off, and can enjoy low costs through retirement.
  • Property taxes can be low as their increases are limited
  • Income taxes are progressive, lower though mid income do not pay much
  • Along the coast, utilities such as electricity and gas are cheap because you don't need much
  • Food is cheaper than a lot of states
  • Recreation is cheaper, a lot of times free
Despite what every web site says that rates states for retirement, CA is a great place to retire. But you have to plan for it. None of those analyses take that into consideration.

If, on the other hand, you plan a retirement that requires large IRA withdrawals to live, a non-income state may start to payoff.
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Old 11-22-2016, 06:09 PM
 
Location: VT; previously MD & NJ
2,186 posts, read 1,340,059 times
Reputation: 6292
Quote:
Originally Posted by james777 View Post
So Texas has high property taxes and high homeowner's insurance rates. Is it worth it just to avoid the state income tax?

I am paying under $700 a year for a house valued approximately $375,000 in Maryland. I suggest you look farther if you are basing this move on saving money.
What part of MD are you in? Certainly not in the DC/Baltimore area.
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Old 11-22-2016, 10:37 PM
 
Location: San Francisco Bay Area
4,691 posts, read 2,541,255 times
Reputation: 9122
Quote:
Originally Posted by RiverBird View Post
Why not a less expensive house or condo in City 2? If you're 60 or older, that may prove a good idea. As you age you need less space and amenities that you have to keep up or hire out for.

How much space do you really need? To me, location is more important than size of home.
60+ here.

We do not need less space, we need more space! Hubby retired and lost his big old office.
We are bumping into each other here!

Last edited by SFBayBoomer; 11-22-2016 at 10:46 PM..
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Old 11-22-2016, 11:42 PM
 
Location: Eugene, Oregon
9,125 posts, read 2,996,123 times
Reputation: 13768
Quote:
Originally Posted by bpollen View Post
My choice (I'll make up amounts, to give a sense of it all)::

Retirement city #1 (city of 125,000): House $240,000; Property taxes $2,000 more a year; No freezing of value or taxes at age 65, but an extra $10k exemption; Cost of living about 0.87% of national avg.

Retirement city #2 (city of 100,000): House $275,000 (for a somewhat comparable house); property taxes $2,000 LESS a year than city #1; Value of house frozen at age 65; Cost of living also about 0.90% of national avg. Also has $1,000 higher cost homeowner's insurance, and a small ($500 or less) state income tax.

Health care is less expensive in city #1. This is figured into the COL, but I wanted to single that out, since it's important to seniors. There is also more health care locally w/o going to a nearby big city. So their COL is about the same, but they are pricier or less pricey on different things.

Your choice would be......?????
I see it as close to a toss-up financially, with a small edge to #1, because of health-care and homeowner's insurance. But you don't know how long you'll be able to live there., which makes some of the advantages uncertain over time. Whichever place you like the most, should be your choice.
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Old 11-22-2016, 11:57 PM
 
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
22,541 posts, read 39,914,033 times
Reputation: 23653
Quote:
Originally Posted by SFBayBoomer View Post
60+ here.

We do not need less space, we need more space! Hubby retired and lost his big old office.
We are bumping into each other here!
Many a Hubby needs a 'barn / shop / acreage' to 'get-away' / putter. Some of us can still not find enough SPACE. (My neighbor has a 240'x 120' shop, (bigger than most people's LOTS... and it is just a tad too small... ) One of my retired friends collects WWII items like Sherman tanks and armored personnel carriers. He has a LOT of shop(s) and a LOT more stuff still sitting outside.

Thus I like the NZ Menz Shed concept! Great for other reasons too, but then that is a country that values engaged / productive seniors and health / wellness.

Go for the low taxes, you can always build a NICE apartment (the size of a LARGE house) INSIDE a decent sized shop / barn. Tax assessor / permitting just needs to know you have an 'accessory dwelling / bathroom or kitchen Range in there... they don't NEED to see it)

BTW: most of my CA originated coworkers fled back to CA in retirement to 'exercise' their Prop 13 benefits.
I could never go cuz they have CARB (and 100zillion people (cars) in the 'drive-up' at in&out, Lobby is often EMPTY, and people are NOT staying in their cars cuz it is RAINING, as it is in PNW only 200+ days / yr.) only 29 days of drizzle in Oct 2016! (but not 2 days of sun...) We are not short on water!

CA is looking pretty good to many in PNW about Feb / March.

Low property taxes and NO income taxes can be found in a few states (even NV with some decent weather (Carson City / Reno).) SD is great domicile, but short on warm winters. (one overnight per lifetime to establish 'residency') Next door SD neighbor, sales tax free MT is handy, as is Oregon to WA domiciled retirees. Have a Sales Tax free state LLC own your motorhome, boat, and luxury car. Works well for FT RVrs, and a few others who can comply with domicile rules.
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Old 11-23-2016, 08:28 AM
 
625 posts, read 381,346 times
Reputation: 698
Low property tax for everyone is a big issue in retirement. For instance I was in Florida not long ago and was shocked no lifeguards at beach or pool, no concession stands, very few sidewalks to walk on, no public bathrooms at beach or parks. Most homes had low taxes but HOA fees to cover road repair, bulkhead repair, garbage pick up and lots of houses with cesspools and well water. Plus car registration and fees high. Heck in Florida even an activity fee for students so clubs and sports are not even included.

My house in a "higher" tax state. We have sewers, sidewalks, water, roadways, etc maintained by town no HOA fees and when I go to beach, lifeguards, public bathrooms and plenty of free adult ed and movie nights for all in summer.

If you like to do nothing low taxes are good.
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Old 11-23-2016, 08:44 AM
 
Location: The Triad (NC)
28,487 posts, read 62,101,894 times
Reputation: 32153
Quote:
Originally Posted by FloridaBeachBum View Post
Low property tax for everyone is a big issue in retirement.
Again... not in isolation to all the other costs.

The *totality* of all housing costs has to be the basis...
which extends to state/local income taxes too.
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Old 11-23-2016, 10:31 AM
 
6,615 posts, read 3,738,816 times
Reputation: 13660
Quote:
Originally Posted by RiverBird View Post
Why not a less expensive house or condo in City 2? If you're 60 or older, that may prove a good idea. As you age you need less space and amenities that you have to keep up or hire out for.

How much space do you really need? To me, location is more important than size of home.
Condos are almost nonexistent in City #2. They have patio/garden homes, but they're poorly built in my price range. Real estate in City #2 is about $20k to $20k more than City #1.

City #1 has condos and a few garden homes. I am reconsidering a garden home there, which has a tiny yard, but I really need more yard for the dogs, shade trees, fruit trees, and a couple of small gardens (although there is a way to garden in a small area).

I don't need a large house. I would like a small cottage. Unfortunately, there aren't many small houses in nice areas.

Whatever I get, it's still true, the differences between the two cities.
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