Choosing a Place to Live in Retirement

Where should you live in retirement? Many have weighed in this topic and there are periodic ratings on which states are the best or worst places for retirement. One resource for such lists is WalletHub, which rates states in three key areas on 24 different metrics. While this resource and other articles may be helpful, it is important to go through your own thought process so you can assess your unique priorities.

Financial Considerations

  • Taxes, specifically state income taxes, are usually the first financial consideration individuals think of. There are other types of taxes to consider, such as state estate or gift taxes, property taxes, and sales tax to name a few. The Tax Foundation is an organization that produces various reports and rankings on the overall tax burden individuals face by state. Not surprisingly, the tri-state area of CT, NY and NJ are among the highest in overall tax burden (latest date found was for 2012).
  • Affordability. Think about the cost and availability of housing you want currently and may need in the future. This might be a retirement community with continuing care alternatives, a free-standing home or patio home, townhouse, apartment or condominium. Additionally, look at the basket of goods you purchase and what these items cost in the area you are considering.

Community Considerations

  • Demographic profile. What type of community are you looking for in terms of size and demographics?
  • Geographic profile. Is it important to you to be in an area with natural bodies of water, mountains, parks, recreational activities, forests, certain weather conditions or some other geographic characteristic?
  • Proximity to educational institutions and cultural amenities. Do you plan to take courses at area educational institutions and/or participate in cultural activities such as music, theater, dance or art, sports and/or other community activities?
  • Availability of quality health care and related facilities. As individuals age, they often consume more health care services so it can be important to research their availability and proximity in advance.
  • Transportation. Do you plan to travel, internationally or in the U.S., or to see friends and family members? If so, proximity to a major airport may be an important factor. Also, if you are unable to drive at some point, what kinds of transportation or support systems are available in the community?

Personal Considerations

• Family and Friends. Is it important to you to be near family and/or friends?
• Fit. Do you see yourself being part of the community? Are there people like you or that you are interested in getting to know in the community?

Each person will prioritize the above considerations differently.

It is key to know what you value most as you may not find a place that satisfies 100% of your preferences and may need to look at a “best fit” as opposed to a “perfect fit”.

To guard against making a mistake, try out the handful of places that are finalists in your opinion. Over time, you can vacation in each finalist location or go for an extended period by renting a place to stay before making a larger or more permanent commitment. In this way, you are more likely to make a satisfying, longer term choice for where you live in retirement.

Valerie Connolly, CFA

Valerie joined HTG in 2011 as a senior advisor. Drawing on 30 years of experience in financial services, she greatly enjoys collaborating with clients to shape their financial aspirations. Valerie takes a lead role in developing client investment plans, researching investment vehicles and developing firm-wide investment policy.

Valerie received a BA from Wellesley College and an MBA from University of Chicago. She is a CFA® charterholder and a member of the CFA Institute, the New York Society of Security Analysts and CFA Society Stamford.