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Finding Cheap Places to Retire
Retirement dollars are worth more in cheap places. That's a fact. Think about it. What if you could have an extra $10,000 a year just for travel and entertainment during retirement? That's the power of a cheaper place to retire. The trick is finding cheap places to retire that you will actually enjoy.
The first thing to think through for retirement is taxes. If you pay your mortgage down completely then you only have insurance and taxes left to pay. There are states whose property taxes are so low it's worth considering moving there for just that reason. Alabama and Louisiana have taken a beating lately through hurricanes and oil spills, but their taxes on property remain low. Property values have as well. That's a double bonus.
Check on property values
Why pay $500,000 for a home that you could get for $120,000? Some people will pay that much for climate or a view. Think about it though. Save that $380,000 and spend it on travel. You can travel to any climate, and pay for any view you want for a long time with the difference. That money invested could conservatively give you an extra $20,000 a year in retirement income. Look at places outside the beltways in the midwest, or consider Arkansas. Even small towns just inland in Florida can greatly reduce your cost of living.
Watch out for Pension taxes
If you are considering California or Connecticut to retire in, you may want to reconsider. So far, these two states flunk on all three accounts. High property taxes, with high property values, and high taxation of pensions. It's like taking a handful of money and tossing it to the wind every morning when you wake up. Some states have such low taxes for retired persons that every dollar might as well be $1.35 compared to other states. Think about it.
Find Quiet Out of the Way Places
Believe it or not, they are often the cheapest. Funny, you would think you might have to pay more for a little peace and quiet. But the reality is a sleep town just outside a busy hotspot can often save you tens of thousands of dollars on property values, hundreds a year on property taxes, and still give you all the access you want to airports and restaurants or golf. Apparently if you want noise and crowds, you have to pay more for it. Go figure.