5 things couples should consider before moving out of state in retirement

Feb 04, 2022

Until recently, it was uncommon for retirees to pick up and move. But new trends show that the tide may be changing. In 2020, nearly 400,000 retirees moved—the highest number in five years. And among those who moved, 38% of them relocated to another state.1

The idea of moving in retirement may sound downright exciting. You’re starting a new chapter in your life and could be ready for a change of scenery, especially if work no longer ties you down. Additionally, you have the freedom to move to a place you love, form new relationships, find exciting adventures, and create a fulfilling life.

But moving in retirement is a serious decision.

If you’re contemplating a move, I’d love to review some critical considerations first. Below I’ve identified five things every retiree should think through before waving their home state goodbye.

1. Cost of living

Evaluate the cost of living in your desired destination as it can be a significant determinant in your retirement readiness, especially if you’re looking to move somewhere with significantly higher living costs.

Living in downtown Atlanta, for example, will look quite a bit different than relocating to Savannah.

Some critical factors to evaluate include:

Home prices
Food and groceries
Transportation
Entertainment
Gym and local club memberships

If the cost of living is comparable to your current area, this point may not be an issue. But if you’re looking at moving to a significantly more expensive area, you’ll need to revisit your retirement savings strategy.

A higher cost of living in retirement could mean revising your timeline, like working an extra year or two. Or, you may also look at other ways to increase your savings (redirect funds to max out your accounts, invest more in brokerage accounts and other savings vehicles, cut current expenses, etc.).

2. Healthcare

By the time you reach 65, you’ll accrue around $11,300 in healthcare costs per year, according to the U.S Department of Health and Human Services.2

Before moving to a new location, ensure it has an adequate medical network to address your needs. Cities or towns with large universities may offer state-of-the-art facilities, whereas rural areas may be limited.

If needed, will you have access to specialists? Does the hospital have a good reputation, or is it your only option? No matter how healthy your lifestyle is, it’s always good to prepare for the unexpected.

You’ll need to look at your current insurance coverage as well since most Medicare C Advantage plans are zip-code specific. Check if the medical facilities in this new location are within your network. If not, determine a course of action for changing plans before moving.

3. Taxes

Every state has different tax laws, which could impact your projected retirement spending.

Potential tax obligations in retirement could include:

Inheritance and estate tax
Property taxes
Vehicle tax
Income Tax

Since tax planning is a significant part of protecting your retirement savings, you’ll want to walk into a new state with both eyes wide open.

4. Quality of life

Arguably the most crucial consideration to make before relocating in retirement is your future quality of life. The place you move to should complement the lifestyle you envision for yourself.

If you’re a foodie at heart, give yourself the option to fine dine any night of the week. Or, if gardening is your passion, you’ll need a warm area with good soil and plenty of sunshine.

Know your lifestyle goals and prioritize them when choosing where to live in retirement.

5. Community

Isolation is one of the most major threats to a happy retirement. If you’re contemplating moving to a new area, create a game plan for how you’ll combat loneliness and find a community.

A fulfilling retirementshould be spent with people you care about, which is why cultivating friendships and making connections with others is critical.

You’re starting fresh in a new area where you may not know anyone. Put some thought into how you’ll create new networks, whether through the gym, social clubs, part-time jobs, volunteering, etc.

Tips for relocating in retirement

As you continue reviewing these important factors, I’ve compiled a few tips to help make the decision easier.

Do a trial run

If possible, try a low-cost, low-commitment trial run in your new area. Ask friends or family who already live there if you can stay for a week or two or rent an apartment on Airbnb.

Staying in an area of interest for several weeks can give you a better sense of what everyday life would be like.

Here are a couple of examples:

Miami’s fun for the weekend, but how will you handle the raging humidity? Are you prepared for hurricanes and other inclement weather? Are you comfortable being surrounded by so many people? Will the daily traffic get on your nerves?

A cabin off the beaten path can be a tranquil break from city life, but will you get bored by day five? Are there hospitals and medical facilities within a short commute, or will you have to drive hours? Do the hills bother your stomach and make you car sick?

Places that feel magical at first may be best left as short-term retreats. In other words, I always recommend looking before you leap, especially when it involves your retirement.

Gauge future travel plans

If traveling and vacationing are definitive goals you have in retirement, make sure you can do so from your desired location.

How close is the nearest airport?
When do they have flights?
Are there several destinations, including domestic and international?
Does your preferred airline fly in/out of there?

Flights may be more expensive from smaller airports, and you may be limited on available connections. So, if a plane ticket to visit your grandchildren jumps from $250 to $500 on average, you’ll need to include that bump into your plan.

If you’re moving away from family and friends who you’d like to visit often, take future travel costs into account. Flying even just a couple of extra times a year can add up quickly. Account for these potential added costs when weighing your options.

Research the weather

What’s one of the first things you do in the morning?

Check the weather.

The weather in a new location may seem minor, but it can drastically impact your lifestyle. If you’re a northerner at heart, it may be challenging acclimating to 100 degree southern summers. If you’re used to flatlands, mountain altitudes, and significant temperature shifts could affect your health.

Finally, understand what the weather will be like all year long. Moving from Georgia to Mississippi won’t be a big shock to your system. But if you’re moving from Florida to Colorado, take additional costs into account—winter clothing, snow tires, heating expenses, snow removal equipment, and more.

Unless you plan to split your time between two places in retirement, you have to be comfortable with the weather in the new location year-round. Remember, there will be tradeoffs no matter where you go.

Making important decisions about retirement

Moving out of state in retirement could be your opportunity to explore a place you love and embark on a beautiful adventure. But before making this crucial decision, I’d love to review these considerations (and more) with you first.

Moving is just one of the many factors you’ll need to consider as a couple. I’m passionate about helping couples better prepare for retirement, find alignment, and make a plan to support one another’s dreams.

Together, we can create a fulfilling retirement plan that leaves you both excited for the future.

If moving is something you’re thinking about, schedule time to talk with me soon.