Retirement is a time of major life changes. For some retirees, relocation is one of them.
If you were tied to your town because of your job or were staying in your home until the kids left, the end of your working life may be a prime opportunity to find a new city better suited to you.
However, when you're considering where to set up your home base during your golden years, there's a lot to think about beyond just where you think it might be fun to live. In fact, there are five key things to consider when you choose where to locate yourself for the next phase of your life.
As a retiree, you'll likely get income from Social Security, investment account distributions, and potentially a pension. You'll probably be living on a fixed income. And the more taxes you pay, the less of your hard-earned retirement funds will be available for you to use to enjoy life.
States have different rules on how different sources of retiree income are taxed. Thirteen states impose taxes on Social Security benefits, for example. And while a minority of states don't tax pension income or retirement account distributions, most states impose taxes on these funds in at least some situations.
Property taxes and sales taxes can also eat into your retirement account balances, and these are much higher in certain states than in others.
You can check out our guide to the most tax-friendly states for retirees to see some of your options for where to live to keep taxes as low as possible.
2. Cost of living
Taxes are just one of the factors that determine how far your money goes. Local costs of living also play a major role when it comes to the quality of life your retirement income can provide.
Ideally, you'll want to pick a retirement locale where your money stretches as far as possible. To find one, consider the costs of housing, food, healthcare, entertainment, and transportation.
A recent study showing the most affordable states for retirees is a good place to start in your search for an affordable new home.
3. Availability of healthcare services
Sadly, as you age, the chance of developing chronic conditions or serious health problems increases.
You don't want to find yourself in an area with few specialists or a limited number of hospitals if you fall ill. To make sure you can get the help you need, explore both the quality of local medical care as well as the number of doctors and hospitals in the area who accept Medicare patients.
The U.S. government has helpful resources available, including a tool that assists you in locating doctors and long-term care facilities in different areas in the country. Use it to evaluate access to care in places where you're considering relocating.
Transportation can be a big expense for seniors. Finding an area where you can walk to most places helps you cut down on this cost. In fact, if you find a very walkable location, you may even be able to get rid of a vehicle. This can save you thousands of dollars per year in registration, gas, and maintenance costs, and it frees you from wasting hard-earned retirement funds on a car loan.
Selecting a walkable area is also a good idea as you may lose your ability to drive as you move into the later years of your retirement. If you aren't in a walkable location, this could signal the end of your independence and the need to move to assisted living. But if you can easily walk to places, you may be able to stay in your home a little longer.
You can check the Walk Score of areas you're considering to find a place where you can easily get around on foot.
5. Activities for seniors
Finally you want to make sure you have things to do in the area you chose to call home.
This may mean relocating to be near family or moving to a place that's a popular retirement destination so you can make lots of friends and find entertainment options catering to an older crowd.
To see what there is to do for retirees, research senior centers, local classes, and local calendars. You can also look out for a large senior population or an ample number of retirement communities, which can indicate there will be plenty of people in your age group in the area.
Make a smart choice about where you'll spend your golden years
By taking each of these key factors into account, you can find an affordable place to spend your retirement where you can hopefully remain active and engaged in your community for a long time to come.