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The author breaks down the likely expenses in low, medium and high cost of living areas in Florida. I like that she uses realistic SS income projections and provides estimates of how large a portfolio needed to augment SS in each scenario.
Last edited by djplourd; 07-17-2018 at 05:33 AM..
Reason: typo
We live 30 miles South of Jacksonville in a beach town. You cannot buy a decent home for $165k period! A dump in a crappy area maybe. It is so far off for the JAX area unless you live in a poor run down OLD neighborhood. Median price means nothing for REAL housing calculations.
Our home is >3,000sqft and cost less to insure and run than the example in this report and we are walking distance from a beach. Other items are more expensive. Food is more for example. We average $7,500 a year but do not eat out much.
We do not do our own lawn maintenance and it is $160pm. House Taxes are higher for us as we have a larger home. HOA Costs are about right. We lease a car too and is it ~$400pm.
I am concerned that people write this stuff leading folk into a poor sense of security. I do not know about Boca and Orlando. Both are too crowded for retirement IMHO anyway, and the traffic is unbearable. The Weather in inland Florida is terrible also. 10 miles from the beach is really the better climate all round the Florida coasts. We have been her for 14 years so we talk from experience.
JAX is the best of the 3 but you really need to re-evaluate the housing costs. A simple Zillow check will reveal that one cannot but a decent home in a decent area for <$300k.
costs with no mortgage run about 1k a month with a nice home in the 225-325k range . that is village dues , utilities , bug maintenance ,taxes , home maint. , insurance and cable
The author breaks down the likely expenses in low, medium and high cost of living areas in Florida. I like that she uses realistic SS income projections and provides estimates of how large a portfolio needed to augment SS in each scenario.
What I think is hilarious is that the linked article from MSN is based on a withdrawal rate of 4%...
Quote:
In general, retirees can withdraw a maximum of 4% of their portfolio each year without being at risk of depleting their portfolio too early, so the total portfolio value needed to supplement Social Security income to cover expenses in each city is the variable in our calculation.
...but just yesterday, MSN posted an article entitled Don't Cheat Yourself with the 4% Rule, and in that article, they quote the esteemed retirement expert Michael Kitces as saying: Unless we see the return of a Great Depression era, followers of the 4% rule “will most commonly just leave a huge amount of money left over.”
I have relatives in FL, some of whom are not doing all that well financially, and it's quite possible to get by on less.
My brother's ex wife did get lucky on housing, buying a new duplex town house at the bottom of an overbuilding downturn a few years ago. I don't know her exact costs, but she mentioned that her total income is around $40k. She is not within walking distance of the water. Bay access is a couple of miles away. She works at a marina on the bay. Beach is about 15 or 20 minutes.
I have 2 cousins within walking distance of the beach, both in older homes, one of which is a converted rental cottage. Neither has an HOA or high property value. Admittedly, some people might be put off by the quality (and size, in the case of the converted cottage) of their homes, but they live simply for far less than the costs listed.
the examples above are in the panhandle.
My sister and her husband rent a small house near JAX; close enough for him to work there. Beach is a ~20 minute drive. I know their total income is under $50k. They don't have a lot left over, but they get by okay.
I think there is an assumption about lifestyle in the article that is more than some of us would insist on.
Interesting information in this article. It's particularly interesting to me since I live in one of the three cities that were discussed.
Of course, everyone's individual situation is going to differ from the hypothetical couple in the article. Some of the amounts that are cited for Orlando are similar to my expenses, others are very different.
I wonder where the analyst got her information about car insurance. It has been my experience that the amount you pay for car insurance is very different from south FL to north FL.
And where is this hypothetical retired couple driving to so much that they spend $250 a month on gas for one car?
I think the article can be subjective for most of the general expenses. Where it is really out is for Decent Housing Costs. At least IMHO Living in a beach town, walking distance from the beach, and close to everything else.
Car insurance for us is $800 a year for a new BMW. We spend about $50 a month on Gas but everything is very close.
Note the HOA fee of $7000 a month, this place surely skews the numbers!
The $97,675 annual tax bill hurts too!
The people who can afford that much for a condo probably have enough spending power that the other costs are just drops in a bucket.
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