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You may be right. I guess it hasn't come yet to that old Yogi quip about the 'restaurant?' ..something like 'No one goes there anymore it's too crowded?'...;-)...
Really as we also are doing an 'investigation' of place Philadelphia seems to be a 'rational' place to live after seeing articles that say NY is THE worst state for retirement. Ok if not THE worst surely one of the worst. The state does 'giveth' but when you get on in age it 'taketh' away!
Things I'd like to hear: the Beatles 'Taxman' stop ringing in our ears.' .;-)..
Depends on one's personal situation. What kind of taxes are you looking at (when it comes to states with income taxes - it often depends on what kind of income you'll have in retirement)?
FWIW - I've lived in Florida for 40+ years. Moved to Florida from Philadelphia. Florida has no state income tax (or estate or inheritance tax). Philadelphia has - IIRC - both a state and local income tax (although - if I also recall correctly - there are certain exemptions in terms of certain kinds of retirement income - check it out). Property tax in Florida is all over the place in % terms - county to county. We pay about 1% of current value a year now in property tax. Base sales tax - not at all important to us - is 6% (although it's higher in certain counties).
When it comes to being older - in terms of costs (as opposed to intangibles) - the cost of housing in a place you care to live in - and the cost of health care are important as well. As are the costs of things you like to do (e.g., my husband and I play golf).
IMO - it's like a menu from a Chinese restaurant. 2 from this column - 3 from that column - 1 from the last column. Add it all up in a particular area - and see what you're looking for will cost for you in any particular place. Robyn
You may be right. I guess it hasn't come yet to that old Yogi quip about the 'restaurant?' ..something like 'No one goes there anymore it's too crowded?'...;-)...
Really as we also are doing an 'investigation' of place Philadelphia seems to be a 'rational' place to live after seeing articles that say NY is THE worst state for retirement. Ok if not THE worst surely one of the worst. The state does 'giveth' but when you get on in age it 'taketh' away!
Things I'd like to hear: the Beatles 'Taxman' stop ringing in our ears.' .;-)..
Travic, keep us updated on your search findings.
As mentioned earlier, one of our major concerns is RE taxes, not so much sales tax, and as retirees income tax less of a concern. We do feel that proximity to good health care, good transportation, cultural venues and all that a college or university offers make Philly a plus.
I would just circle areas 4 hours southwest of NY since that's where there is a milder winter & then just see what amenities are available for what you like & COL/taxes situation. Knowing you want to be 4 hours away eliminates a lot of areas.
Hefe, appreciate the input. Our reason for roughly a 4 hr driving distance is being able to visit family & friends on LI once or twice a year. We've had it with the airlines and avoid that option whenever possible, and as we get older like the option of Amtrak, so cities near that have a plus.
Travic, keep us updated on your search findings.
As mentioned earlier, one of our major concerns is RE taxes, not so much sales tax, and as retirees income tax less of a concern. We do feel that proximity to good health care, good transportation, cultural venues and all that a college or university offers make Philly a plus.
I agree ul 885. At this point though we will need to personally check out the areas on RE taxes. I hope that say in 2 yrs I can say hey I did find a good place 4 hrs away that won't kill our budget and that we could live reasonably well. We will see!...;-)...
I would just circle areas 4 hours southwest of NY since that's where there is a milder winter & then just see what amenities are available for what you like & COL/taxes situation. Knowing you want to be 4 hours away eliminates a lot of areas.
As an update, we decided to take your advice and look a little further distance from NY. Happily, we found a great community (not age restricted, which is great) just outside of Chapel Hill, NC. It has everything we are looking for plus all the activities, restaurants & events a college town offers. The community is also adjacent to a Duke Wellness Center (indoor pool, gym, classes and a primary care physician's office!) Taxes <$1800 - taxes on our condo in LI are $7800
So being within 4 hr drive is no longer an issue - we can take Amtrak or fly out of Raleigh.
Thanks for your suggestion!
As an update, we decided to take your advice and look a little further distance from NY. Happily, we found a great community (not age restricted, which is great) just outside of Chapel Hill, NC. It has everything we are looking for plus all the activities, restaurants & events a college town offers. The community is also adjacent to a Duke Wellness Center (indoor pool, gym, classes and a primary care physician's office!) Taxes <$1800 - taxes on our condo in LI are $7800
So being within 4 hr drive is no longer an issue - we can take Amtrak or fly out of Raleigh.
Thanks for your suggestion!
We never considered that Amtrak was right in our new neighborhood when contemplating our move from NJ to NC. While it is a longer ride than drive 12 hrs vs 10 hrs it costs just the same, around $85 and I don't have to do the driving. I like the fact that I can just show up right before the train arrives and no TSA hassles or baggage check.
Very happy that I have another option instead of driving. I have taken the train to FL and back to NJ a few times.
We are in the Sand hills so those travel times are a little longer than CH.
Back to the OP's question. Have you considered perhaps moving to an area outside the 4 hour drive circle that's serviced by an airline like Southwest (which has service to Islip Airport)? That would expand your options considerably (although it might make it harder to pick a place ).
Also - I don't recall how old you are. But - as my husband and I get older - we dislike driving more and more. Especially in highly congested areas (I suspect the NY metro area is one of those these days - but there are many others).
Also - we've observed in our families that the travel to see friends and (especially) distant family gets old after a while. Especially if you're the one doing all the driving. Especially as those friends and family wind up scattering all over the place (you're not the only person thinking about leaving LI - we have many visiting the JAX forum these days). Along these lines - I think the most important family to think about is elderly living parents first. The older they get - the less ability they have to come visit you. And you can't not visit them. Also - many elderly parents will wind up being dependent on you (or your siblings). In the case of me and my husband - we wound up relocating halfway between both sets of parents (when they were all alive). About a 4 hour drive to each (in opposite directions). At least 2 trips to each set annually (and more when there was illness in the family).
Our fathers wound up moving to our neck of the woods after our mothers died. Although we didn't know it when we moved here - our area has excellent (and reasonably affordable by national standards) "senior senior" places in various flavors. They have really made our lives easier over the decades (yes - decades - my late FIL moved here in 2002 and my father - still alive - moved here in 2006 less than a year after my FIL died). FWIW - my husband's and my siblings rarely visit(ed) us - even to see their fathers. Anyway - this is a family job that someone usually winds up doing (and my husband and I have been "it"). Might not be an issue in your situation. But it's something for people to consider.
Also - there are children/grandchildren to consider (again perhaps an issue in your situation - perhaps not). They usually won't need help like parents. OTOH - they're more likely busy with their own lives. With little time to visit you. And they're more likely to be mobile - and wind up moving here/there/everywhere. Proximity to a good airport is better insurance when it comes to visiting than being an X hour drive away.
Anyway - those family members would be my primary considerations of terms of people when it comes to moving to a particular place. When it comes to people your age - your friends - I think that 10 years down the road - you'll find that many have left LI (like you're planning to do).
As for COL - there are lots of things to consider in addition to property taxes. For example - when it comes to the cost of housing - the property taxes where we live are lower than those on LI. But we do have to buy things like windstorm and flood insurance. OTOH - there are people from the NE inquiring about our area now who have mentioned the need to buy flood insurance/do other things these days up north as a result of storms like Sandy - the floods in IIRC Vermont - etc. So it pays to scratch the surface when it comes to COL (everyone associates Florida with flood insurance - but few associate it with a place like NJ).
Same thing applies when it comes to condos and the like. Especially monthly maintenance costs - which can vary a lot for many reasons (e.g., the condo with the low monthly maintenance may not be keeping enough reserve funds). Also note that if you prefer a non-multistory building - you are in general talking about areas that are suburban as opposed to urban.
When it comes to medical stuff - again there is more than meets the eye at first glance. When you get on Medicare (if you're not there already) - the cost will vary - especially when it comes to Medigap policies. For example - our Medigap policies cost us $380/month here - but would cost us 40% more in south Florida. I have no idea what the prices for these policies are anywhere outside Florida. But - as you can see - they can be right up there with property taxes in terms of budget amounts - and the prices can vary a whole lot. If you're not on Medicare yet - check out the available insurance options (which could be anything from an employer policy to an ACA policy) - what they cost - and what facilities they cover. The last is particularly important these days as many insurance companies increasingly restrict their networks. Doesn't matter if the best hospital in the world is around the corner from you but your insurance won't cover you if you go there.
In terms of other taxes - I don't think sales tax is a "biggie" for most people. But income taxes can be. You have to go state by state - sometimes city by city - and see what the tax man will take from you for the "privilege" of living in a particular place. Keeping your particular forms of income in mind. The amount you have to pay to your local tax man can range from $0 to surprisingly large amounts.
Then there are smaller - but often not insignificant - budget items. Like auto insurance. Could cost you $500 in one place - $3k in another. And all the various flavors of utilities.
When you start drilling down into specific numbers in larger budget categories - you may well be able to rule in/rule out various places before you even step foot in them. Robyn
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We've read every post carefully, and thank you all for your comments
After months looking, we unfortunately had to rule out Philly, though I still love it and would move there in a heartbeat if we could afford a condo in the Center City area (can't budget for the parking costs and DH wants to keep the car), or Media (prices and taxes a little high for us).
So, as suggested, we looked further than the 4 hr drive from NY and found a wonderful community (not age restricted!) just outside of Chapel Hill, NC. Within a very short drive we have that great college town with all it has to offer, top notch medical care (UNC & Duke), four seasons, low taxes and a bit of the country near the city. If we choose to visit LI we can drive (probably not), take Amtrak from Raleigh or fly (hopefully not).
We'll continue to share our experiences during the upcoming move and look forward to hearing from others.
Philadelphia has - IIRC - both a state and local income tax (although - if I also recall correctly - there are certain exemptions in terms of certain kinds of retirement income - check it out).
Robyn is right - there are state and local wage taxes which combined equal about 7%. If one is not earning wages, however, there are minimal taxes for most retirees. Pensions (public and private), 401(k) distributions, IRA distributions, and Social Security are exempt from both state and city taxes. Dividends and income from so called "non-qualified" investments are taxable however; they are taxed around 3% by the state and also around 3% by the Philadelphia school district. Property taxes in Philly are just a fraction of what we paid in Houston. Texas is known to be tax-friendly, but the money has to come from somewhere, and it comes from high property taxes. Whether it is high or low to someone will depend on where they are moving from.
To the OP: congrats on landing on Chappel Hill for your new home. It takes a lot of work just to figure this where you want to live, so now the fun can begin. Best of luck
Robyn is right - there are state and local wage taxes which combined equal about 7%. If one is not earning wages, however, there are minimal taxes for most retirees. Pensions (public and private), 401(k) distributions, IRA distributions, and Social Security are exempt from both state and city taxes. Dividends and income from so called "non-qualified" investments are taxable however; they are taxed around 3% by the state and also around 3% by the Philadelphia school district. Property taxes in Philly are just a fraction of what we paid in Houston. Texas is known to be tax-friendly, but the money has to come from somewhere, and it comes from high property taxes. Whether it is high or low to someone will depend on where they are moving from.
To the OP: congrats on landing on Chappel Hill for your new home. It takes a lot of work just to figure this where you want to live, so now the fun can begin. Best of luck
My late in-laws lived in NC post-retirement. It's a very tax unfriendly state IMO. IIRC - could be wrong - all of their income (SS/pension/investments) was taxed at pretty high regressive rates. And there were some pretty nasty estate/inheritance taxes as well. Can't recall all the particulars. All I know is when we had to move my late FIL to a SNF here for his last couple of years - the first thing we did after getting his medical situation stabilized and making sure he was in a place was to make sure he was considered a tax resident of Florida ASAP.
I don't know how things work in other states - but high property taxes can be illusory depending on what your property costs. For example - the house my inlaws had in NC was assessed at/was worth about $100k - and they paid about $700/year in property taxes. Our property tax rates are higher in Florida. But - if you buy a $100k house here (hard to find) - you'll probably get a $50k homestead exemption - and would only be paying taxes on $50k. So the property taxes here would be about the same (give or take) as those in NC (depending on the property tax rate where your house is located).
The devil is always in the details. And it always makes sense to find out how tax stuff in a particular state works when it's applied to one's particular situation. When it comes to me and my husband - most of our taxable non-retirement account money is in a very diversified high grade municipal bond portfolio. In Florida - we don't have to worry about state income tax - so we can buy here/there/anywhere when it comes to state tax stuff. It would be a very different story in states with state income taxes - especially high state income taxes. In all honesty - there isn't a single state in the US where I'd feel comfortable buying all or even most of our munis these days. We don't have more than 10% of our holdings in any one state. And forget about Puerto Rico!!! Robyn
I don't know how things work in other states - but high property taxes can be illusory depending on what your property costs. For example - the house my inlaws had in NC was assessed at/was worth about $100k - and they paid about $700/year in property taxes. Our property tax rates are higher in Florida. But - if you buy a $100k house here (hard to find) - you'll probably get a $50k homestead exemption - and would only be paying taxes on $50k. So the property taxes here would be about the same (give or take) as those in NC (depending on the property tax rate where your house is located).
I believe people who focus only on taxes are missing the forest for the trees. I see lots of posters in the forum who only seem to be interested in finding the tax-friendliest locale they can take their money to and retire. While taxes are important when considering where one can afford to live, I suggest folks look at a bigger picture.
Most of us want to live as comfortably in retirement as our resources will allow. The biggest expense most of us will have is our home and so in moving, we search for a house that fits our budget in a setting we can afford. Prices for homes vary enormously across the country, but costs for maintaining those homes vary considerably, as well. Our roughly 2000 square foot home in Houston costs us around $600/month to keep modestly cool for 5 - 6 months each year - I am not exaggerating. We also paid about as much for heating when we'd have cold snaps as we had vaulted ceilings and the downstairs heat rose to the rafters. Folks who live in hurricane-prone areas, such as Houston, also pay a premium for home insurance because of the possibility (nay the reality) of hurricanes. We also carried flood insurance (and are glad we did). In addition to home insurance and utilities, other costs that can vary widely across the country include car insurance, groceries, and sales tax (not to mention which items are exempt - food? drugs? closeting?). Let's also not forget commuting/driving costs in case anyone plans to spend lots of time on the road - some areas are loaded with toll roads and their freeways are constantly clogged - and those costs can add up quickly if one is on the road daily. For for those considering single family homes with property, many of us can't do the same upkeep we used to, so costs for lawn care vary across the country and folks up north will pay a lot for snow removal once their backs are no longer up to it. I'm sure there are other costs I've overlooked, but you get the picture.
My point is one could find themselves moving to a low-tax area only to end up paying more overall just to keep their home cool, manicured and insured and drive their cars where they want to go. There is no one place that is the most cost-efficient for everyone. I quoted your post above because as you note, each person's financial situation is unique and will vary depending upon location. Anyone considering moving in retirement should take into account every cost associated with living in their potential new home - not just housing and taxes - to avoid some costly surprises they hadn't budgeted for.
[btw - In case you don't recognize me, I changed my username from jm02. You're likely to find me just as annoying, however ]
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Decided on Chapel Hill area
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