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But beware of other taxes and insurance. In 9 years our insurance went from $1200 to $8000. Our neighbor who sits a little lower on a stream pays $12000. If you live on or near the water, even more! Counties here vary in how they charge property tax, but it can make for an awkward conversion with new neighbors who find out they are paying almost 3 times what their neighbors are paying. A house down the street recently sold for $985K, the only sale on our street since 2014, when most of the homes were built, and those sold at ~$550 on average. They are paying way more than us original owners but even we have seen it go up every year by about $100.
Other things that people forget about when moving to Florida is that yard work and its costs are year-round, and as growing grass here is hard, many end up going with professional lawn care, everyone needs sprinklers etc. We use reclaimed water in my neighborhood, but for many, it is paid for by the homeowners. My mother's water bill was on average $150 a month, while mine is $85 but that includes trash and recycling pickup and 3 people. Hers was just water for a single person..with a yard. More bugs mean more aggressive pest control, an additional cost. Mold and mildew grow on everything here so powerwashing etc is an additional expense people who move from other places don't consider.
So the income tax thing is just a tiny part to consider.
Wow! That is really incredible. But, they need to raise it where the issues are happening instead of raising the entire US. Populating the most risky areas should actually be discouraged.
I agree that there is no simple formula for assessing the cost of living for various areas. People are making some really interesting points.
I can see how this is a double edged sword. Taxing food hurts those that can least afford it.
On the other hand, much of Tennessee's huge growth is because of a lack of income tax. Many people along with job creating industries have moved there because of that reason. It seems many people especially retirees won't consider moving to a state with income taxes anymore, no matter how small they are. Florida is somehow able to do it without taxing grocery store foods but I know little about all of this.
When I lived on the East Coast of Florida we used to joke that the seasonal influx of people made it hard to get a table at a restaurant but it was the price we paid for them keeping our taxes low by spending and paying sales tax.
Yes, I think people are surprised by the reality vs their preconceptions of living in NYC.
NYS doesn't tax SS nor the first $20K withdrawn from an IRA. Over time I have used this to do Roth IRA conversions with little tax consequence so that now 2/3 of my retirement savings is in the Roth IRA.
So $40K from SS + $20K from IRA + $20K from Roth = $80K income annually with no taxes due at all. NYC RE taxes are suprisingly much less than our surrounding suburbs as well.
If one is able to find a nice place to live with reasonable costs it isn't bad at all for an urban lifestyle, but that is the key element that takes some searching & luck. My non discretionary costs, excluding groceries, barely reaches $1K/month for a very comfortable lifestyle for me on that potential tax free $80K that I can hardly figure out how to spend (still haven't figured out how to spend that much!)
I really investigated almost all of the LCOL places mentioned all the time on here & every single one of them would cost me more per month to live in with a great reduction in choices of the (urban) activities I enjoy. (I understand many people don't want to live in a city, I would wither in the 'burbs based on past experience.)
Between you and MathJak I feel like I would enjoy NYC and it would be a relative bargain. One of my issues is I cannot live anywhere where there is ice, black ice or a few weeks or months of snow will be on the ground (due to a mobility issue from an accident). So, that is a limiting factor. The big issue is being older and not knowing people there.
If I transition and downsize I could see spending a year renting in NYC, six months in France, six months in Italy. That would be an interesting way to experience other areas.
I actually would like to see Tennessee have a reasonable progressive state income tax and do away with the regressive sales tax on food. That would help people on the lower rungs of the economic ladder and there are a lot of them here.
I agree. It would also help out with the "you get what you pay for" (or not) and services and schools might be better.
Why do people spend money for water to grow grass where it naturally doesn't grow in order to then spend money to mow it year-round? That seems to me the height of insanity. In other words, some of these "hidden costs" can be mitigated with a little common sense.
Couldn't agree more but if you want a certain house in a certain area, which we did (right school etc) it can force you to comply with the HOAs etc. We wanted a big lot, with a limited view of our neighbors, so we are on a corner lot, bigger than others, but with the minimum required amount of grass, but it still costs.
Couldn't agree more but if you want a certain house in a certain area, which we did (right school etc) it can force you to comply with the HOAs etc. We wanted a big lot, with a limited view of our neighbors, so we are on a corner lot, bigger than others, but with the minimum required amount of grass, but it still costs.
In a perfect world....
My HOA is annoying. But, we also do not have anyone painting their house bright blue or parking in their front yard. It maintains values.
No State Tax on Social Security Benefits: Alabama, Alaska, Arizona, Arkansas, California, Delaware, District of Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, Nevada, New Hampshire, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, South Dakota, Tennessee, Texas, Virginia, Washington, Wisconsin, Wyoming
Sometimes the answer to the question is not a simple yes or no. For example, Colorado is not on this list, so one might assume it's all bad news. But if you dig into the details you'll find out that SS benefits are largely untaxed by Colorado.
Here's another article that may be of interest to followers of this thread...
Georgia doesn’t tax social security, or pensions under $65k.
Pretty much in effect in a very few states/situations your SS will be taxed - even the states that tax SS on paper provide exemptions based on age and income.
Majority of people with the average income don’t pay tax on SS anywhere in US - unless they have high income in addition to SS from other sources
Yes, I think people are surprised by the reality vs their preconceptions of living in NYC.
NYS doesn't tax SS nor the first $20K withdrawn from an IRA. Over time I have used this to do Roth IRA conversions with little tax consequence so that now 2/3 of my retirement savings is in the Roth IRA.
So $40K from SS + $20K from IRA + $20K from Roth = $80K income annually with no taxes due at all. NYC RE taxes are suprisingly much less than our surrounding suburbs as well.
If one is able to find a nice place to live with reasonable costs it isn't bad at all for an urban lifestyle, but that is the key element that takes some searching & luck. My non discretionary costs, excluding groceries, barely reaches $1K/month for a very comfortable lifestyle for me on that potential tax free $80K that I can hardly figure out how to spend (still haven't figured out how to spend that much!)
I really investigated almost all of the LCOL places mentioned all the time on here & every single one of them would cost me more per month to live in with a great reduction in choices of the (urban) activities I enjoy. (I understand many people don't want to live in a city, I would wither in the 'burbs based on past experience.)
It's funny you are saying this because SO MANY People are under the impression it's too expensive to retire in America. I tell them all the time that most retirees are doing just fine. They pay little taxes, they don't spend much and most own their homes outright.
Very few believe me though.The proof is in the data the Bureau of Labor Statistics presents every year. But people like to live in fear rather than reality, sadly.
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