Thinking About A State To Call Home

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Via Facebook, I see that the question of where to live in retirement strikes a chord.

A friend from high school and college (he’s definitely a retirement-eligible Baby Boomer)  provides some interesting info. He reports that the best five states to live in, if you want to stretch $1 million in retirement savings, are Mississippi, Arkansas, Tennessee, Kansas, and Oklahoma. I can see how they’d all probably be among the low cost-of-living states. And Tennessee is picturesque, plus it has Nashville. I don’t know that I’d be interested in the other four. ($1 million in retirement savings? Only in my dreams!)

Long as we’re on the subject, my friend reports the five worst states to spend your $1 million are Hawaii, Washington, D.C., California, Oregon, and New York. Or maybe they’re the best places to spend a million real fast. They all sound plenty pricey. Hawaii is probably worth it. And the other four all have some advantages to recommend them, depending on your individual preferences.

An excellent source for all kinds of U.S. geographical information is Bob Wells, famous for his Santa Claus beard and his YouTube channel, CheapRVLiving. Bob goes into the question of home states in some detail, including four long videos on YouTube and posts on his website, CheapRVLiving.com.

After listening to Bob, you’ll understand that choosing a state to call home is not an inconsequential matter. Far from it! It’s a lot more than cost of living, although that is important. First, he sets us straight about legal issues. You can own or rent a home in more than one state, if you can afford it. But Bob says only one state is your legal domicile. You can only have a driver’s license or vote in ONE state. “Domicile Sweet Domicile.” Doesn’t sound poetic, but it has serious implications.

I’m not going to repeat everything Bob Wells explains. Go to his YouTube channel or Website. Some of the most important domicile considerations for retirees who aren’t old enough to qualify for Medicare are medical. Does your health insurance cover you wherever you roll in the USA, or only in your home state?

Bob approaches the question of legal domicile from the perspective of folks who live on wheels, in their recreational vehicle (RV). It could be a travel trailer, a Class A, B, or C motor home, a van or pickup truck, or even a car. Whew! Come to think of it, more than a few retired folks choose exactly that lifestyle. Once they were tied to jobs, now they’re free to take to the open road.

Bob Wells identifies some of the best states for RVers to consider as a domicile, even if they’re rarely in that state. They are: South Dakota, Florida, Texas, and Nevada. A major item of interest to RVers is how easy the state makes it to become a legal resident, get a driver’s license and register your vehicles. In SD, FL, TX, and NV it’s pretty easy. South Dakota is easiest of all. And all four states offer the advantage of no state income tax, a major attraction for many retirees.

Other states with no income tax are Washington state, Wyoming, New Hampshire and Alaska. I’m not sure about Tennessee.

I think the Middle Atlantic states are generally among the higher cost of living and taxes. My state of Maryland has an income tax, plus a county income tax that piggybacks on the state tax.

Many people from Maryland move to Delaware for retirement. Far as I know, Delaware has income tax, but no sales tax. My Uncle Joe owns a home in southern Delaware, and besides no sales tax, he brags about his low annual property tax. Uncle Joe just turned 90 and he’s sharp as a tack.

Remember, it’s not all about money. Low cost of living and low taxes are not the only considerations, and maybe not the most important. Please don’t make any decisions based on the information in this post, or anything else you see on the Internet. Do your due diligence and make decisions based on verified correct info.

In a day or three, I’ll get back to why I chose Florida. Hint: It’s not about the income tax.

— John

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Geography And Retirement

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green trees

MARYLAND IS A DELIGHTFUL PLACE TO LIVE. IT’S GREEN, IT HAS MOUNTAINS AND SEASHORE. THIS IDYLLIC SPOT IS IN MONTGOMERY COUNTY. BUT . . .

Time to get serious about answers to that pesky question:

How and where do I live a good life at this late age on a sustainable basis?

As I approached and passed the retirement point, the where question was the most urgent one for me. I’m still working on the more elusive how, and I’ll leave that one for later.

For many retirees, where is not an issue. If you live in a home that you love and can afford to keep, AND there’s no strong attraction to a different location, then case closed.  For most folks in that situation, proximity to children and grandchildren might be the only reason to consider relocating. I had never in my adult life established a permanent home, and I have no children or grandchildren, so I was free to move or stay put.

Two issues convinced me I badly needed a change of geography.

I didn’t mind the weather in my home state of Maryland until my fifties. But after 50 I came to dislike the winter months more with each passing year. Even so, I might not have moved for climate alone. I liked Maryland in most respects, and I have siblings, nieces and nephews, and friends living there.

My car 2

MARYLAND WINTERS CAN BE COLD AND SNOWY.

SnowMon5

HOW DEEP CAN SNOW GET IN MARYLAND?

The deciding factor was cost of living. As job prospects deteriorated in my fifties, I moved to smaller and smaller apartments. Income declined and debt increased. It became obvious that I couldn’t AFFORD the Washington-Baltimore region of Maryland, where I’d lived most of my life. I began researching the alternatives long before I would qualify for Social Security at 62 or Medicare at 65. I started the research close to home, in the different regions of Maryland, and gradually expanded outward.

In a day or three, I’ll pick up the geography story.

— John

 

The Most Privileged Americans

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Income insecurity is not an important problem for retired Americans.  Not at present.  In fact, it’s just the opposite. Retired Americans probably enjoy more income security than the vast majority of people around the world and throughout history.

I’m a retired American on the brink of 70. I’m not wealthy or even affluent, but neither am I poor or insecure. I’m very grateful for the life and security I enjoy at this point.

The most privileged people in the world today are the following:

  1. The top one percent or five percent of Americans. I don’t know exactly where to draw the line. Maybe it’s the top 20 percent or 40 percent.
  2. Most elderly and retired Americans. (However, it must also be acknowledged that too many Americans, including elderly Americans, remain trapped in poverty.)

Just my opinion.

Some people reportedly believe that older Americans are a wealthy class, living the high life at the expense of impoverished children and struggling younger adults. That’s because we enjoy remarkable income security, thanks to Social Security and Medicare. Many of us also have some pension benefits and even some savings. Younger and middle-aged Americans are rightly skeptical that they will enjoy similar benefits. The stage is set for intergenerational contention. The future is impossible to predict. The income security of younger generations is a matter of politics and economics, and I don’t want to go there. At least not today.

What I want is to present an honest picture about the realities of retired life. It’s not all about money. It’s true that many will need to cut back spending and lifestyle to be in balance with our retirement income. But my previous post about income and spending may have left an incorrect impression linking income and spending issues entirely with retirement. In fact, people can suffer a sudden loss of income at any time in life, and for myriad reasons. Loss of job, divorce, recession, business failure, and illness, to name a few.

Most of the natural world and human life run in cycles. It’s Biblical. Seven wet years and seven dry years. And so forth. The business cycle of expansion and recession is notorious and causes much misery. Financial consequences can be cumulative. An adjustment of income and spending at retirement is simply a part of the much larger cycle of human life. It may be that we are at the peak of the Social Security and Medicare cycle. I hope not.

I will turn soon to lighter subject matter.

— John

 

Income can decline quick and easy, spending seems frozen

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One thing I know. It’s easy for income to crash and burn. It’s not so easy to reduce outgo, that is, spending.

People become accustomed to a standard of living. It’s painful to take an ax to that standard of living after a loss of income. People cling to the familiar. Spending seems frozen solid. It thaws slowly.

If you live in a house, mortgage payments won’t go down, at least not easily. Selling the house could take months, or years. If you live in an apartment, you might at least have to wait for the lease to expire before you can move. And then, move where?

The kind of clothes you’re accustomed to wearing, the food you’re accustomed to eating, the entertainment you enjoy, whether lavish or simple. The car you drive! And the cost of gas. All the familiar things constitute your lifestyle. They cost money. Lifestyle is change-resistant; cutting spending is slow and painful. It’s the way of the American capitalist-consumerist economy.

A few days ago, I promised to outline the steps that brought me to the present, which includes being able to restart this blog. I don’t want it to be all about money. Money is not important; that’s been my philosophy. Nonetheless, income and spending dictate the details of the way we live.

When I turned 65 in the summer of 2013, and became eligible for Medicare, I imagined I could afford to retire. You know, stop working. So when the motel closed at the end of the season, I told the owner I wouldn’t be back for the 2014 season. Even now, I can’t say if that was the right or wrong decision. No point in looking back.

I moved to my home county, because that’s where I grew up and where most of my relatives still lived. It seemed the logical thing to do. But the Washington, D.C., metro area is high cost-of-living. It became apparent that I couldn’t afford to rent an apartment congruent with my accustomed lifestyle. (And I was accustomed to living in quite small, one-room efficiency apartments.) Since rent is the largest item in my budget, rent became the central issue.

So I decided to stop working (retire) in 2013. Retiring and moving in the same year are probably not a good plan, but that’s what I did. The reality of the income/spending lifestyle predicament soon became obvious. I should have been more aware that retirement would reduce income and require adjustments.

The obvious question, which I raised two posts ago, presented itself:

How and where do I live a good life at this late age on a sustainable basis?

Before long, in early 2014, I began pondering and researching the above question. Researching consumed most of 2014, 2015 and 2016. In a day or three, I’ll pick up the story.

— John

Florida Next Winter

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Note: This post was first published Jan. 8, 2015 on one of my experimental blogs. Now it’s December 2015. The year has come and gone, and a new winter will begin Dec. 21. And I’m not in Florida yet. My excuse is that major life decisions take time. I’m working  on it. 

Baby, it’s cold outside!

Tuesday, we had snow and 26 degrees. Wednesday, it was 17 degrees in late afternoon, and down to 12 degrees by the time I got home from work, around 9:30 p.m. I live in the Mid-Atlantic states. The climate here is supposed to be relatively moderate.

Except when it’s not. Tonight, it’s cold as a witch’s tit.

The heater in my 216-square-foot apartment runs constantly all night. It can’t raise the temperature inside high enough to cut off.

Is it any wonder that every year about this time, my thoughts turn to Florida? I’ve only been there once. I flew into the Tampa airport to help rescue my brother (he was very ill) and drive him back to Maryland. I have very little direct experience of Florida, but I know a lot about it second-hand. (Update: Took a two-week road trip to Florida in June 2015 to research housing options. So I’ve made a little progress.) Continue reading

Retirement Made Simple, A Brave New Blog

Here’s a new blog of interest to readers who are retired or dreaming of one day being retired.

Retirement Made Simple

Aging gracefully and enjoying retirement on a limited income

Here’s a sample of posts that made a hit with readers at the new blog:

  1. Social Security Cost-Of-Living Increase For 2016 In Danger
  2. AARP Says More Work And Less Retirement Is Good News
  3. Erica Jong on Fear Of Dying
  4. Colorful Cuba On My Travel List, Because I’ve Already Seen Florida
  5. Retirement Offers Freedom, If We Can Seize It

The new blog has a narrow focus. It’s about Retirement, Simplicity, and Aging Gracefully on a fixed income, with a little bit of travel in the mix. If you have an interest in any of those subjects, Retirement Made Simple might be for you. Its target audience is retired folks and workers who are nearing retirement or thinking about it. But surprisingly, many of the readers have been younger adults. Seems that people of all ages are curious about retirement.

I hope you find something informative or interesting on the new blog. Let me know what you think.

What Happens To Social Security Owed To Folks Who Die Young?

Retirement is good. I haven’t felt like going to work a single day this week. I’m thankful that I don’t have to. Been there, done that. Enough!

When I say, hear, or read the words “Social Security” or “Medicare,” my reaction is:

“Thanks to God and the Democratic Party.”

Some say Social Security benefits need to be reduced because people are living longer.

Really?

We’ve always had old folks — eighty years, ninety, one hundred, and even higher. Nothing new under the sun. But are more folks living to advanced ages than ever before? Probably, because the population is larger than ever. But just because nearly everyone knows someone very old, that doesn’t mean that everyone is living deep into old age.

“Are people living much longer in retirement? Or is the truth, now and always, that a few people with good genes and good luck make it to old age?” — From “Me And The Blog”

I personally have known more people in the Boomer generation who died at 60, 62, or 66, to pick a few numbers. Boomers are dying in their forties and fifties. All the folks who die young paid into Social Security every week since they began working. They’re never going to collect a penny. Those who die in their sixties draw benefits only briefly. Who gets the money?

Who gets the uncollected old-age benefits of the masses of people who die young? Seems to me that more Baby Boomers are dying in the fourth, fifth and sixth decades of life, than will make it to the eighth and ninth decades.

Seems to me that the many who die young balance out the few who grow old. I’ll leave it to an enterprising young auditor who understands actuarial data to figure it out.

— John Hayden

AARP Online Retirement Livability Index

A new AARP Livability Index can tell you how your city or town (or the place you’re thinking about relocating) ranks as a place to live and grow older. The Livability Index, which can rate practically any neighborhood in the U.S., goes live this week, according to The Washington Post and a host of other mainstream media outlets. You can find it at aarp.org/livabilityindex. (Interestingly, many MSM sources fail to give the url for the new AARP tool.)

AARP describes the new resource as follows:

“The Livability Index is a signature initiative of the Public Policy Institute to measure the quality of life in American communities across multiple dimensions: housing, transportation, neighborhood characteristics, environment, health, opportunity, and civic and social engagement.

An interactive, easily navigated website, the Livability Index allows users to compare communities, adjust scores based on personal preferences and learn how to take action to make their own communities move livable.”

I entered my Maryland zip code into the system and found out in about half a second that my Gaithersburg neighborhood rates 59 on a scale of zero to 100. I also received specific ratings on the following livability measures:

  • Housing (affordability and access)
  • Transportation (safe and convenient options)
  • Environment (clean air and water)
  • Health (prevention, access and quality)
  • Engagement (civic and social involvement)
  • Opportunity (inclusion and possibilities)

Housing in my neighborhood rates a measly 36. Not a surprise to me. I already know that generally speaking, you can’t buy or rent a home in Montgomery County, MD, unless you’re affluent. You need two middle-class incomes or one high income to support a family here. (That’s why I’m researching communities in Florida. The cost of living in many parts of Florida is quite reasonable, compared to the Maryland suburbs. Needless to say, the AARP Livability Index will be a great help in my search.)

On the positive side, my neighborhood rates high in Health (79), and gets pretty good scores of 64 on both Neighborhood and Engagement. (I’m doubtful about the high rating for Engagement. If AARP considered voter turnout in the last election, we would rank much lower.)

Transportation rates 56. Even if you own a car, that’s an optimistic number. The Washington, D.C. area is notorious for rush hour traffic. If you depend on public transportation, I dunno. My part of Montgomery County is past the end of the line for the Metro subway. And Metro overall? I don’t have to ride the subway every day, and I’m glad I don’t. MARC commuter trains are good if both your home and workplace are near a rail station.

The transportation score could go up or way down in the future, depending on whether our leaders and voters are willing to fund plans for the Purple Line in the southern parts of Montgomery and Prince Georges Counties, and Bus Rapid Transit in northern Montgomery.

Take a look at the AARP Livability Index. How does your hometown rate? Are your civic leaders going to be bragging, or running for cover?

— John Hayden

Retired

Let the record show that I’m officially and fully retired from paid work. My final night shift ended at 9 p.m., April 16, 2015.

I first retired in the fall of 2013, after the motel closed for the season. A year later, fall of 2014, I decided to take on a part-time job, four evenings a week. Six-months later, in the spring of 2015, I decided to give up the part-time gig and return to full retirement. I think this time, retirement from paid work will stick.

Retirement. What could possibly go wrong?

Friends and countrymen, retirement is like ice skating. It looks easy, but it is difficult. Like ice skating, retirement requires practice. Also like ice skating, retirement involves risk, even danger, especially if done recklessly.

I’ll have more to say about retirement, probably much more. But not tonight.

— John

Retirement Ennui

Folks who earn their living in a seasonal beach town get an adrenaline rush during the whirl of summer. Naturally, letdown and loss follow when the music stops. By Christmastime, the “Wait till next year” anticipation sets in. Anticipation is good to have during the dark night and the cold winter.

This October, the music really stopped. For the last time. Retirement. Fin de siecle.

The motel will reopen in May, but it will reopen without me.

The initial experience of retirement is bittersweet for most lifelong workers, I would venture. You don’t know whether to laugh or cry. It’s disorienting, unbalancing. But probably not as bad as quitting smoking cold turkey.

I’m making too many changes, more quickly than is advisable. I’ve been thinking about and planning the changes for a year, at least. And heaven knows, I’ve experienced plenty of other changes along the way.

Equilibrium will return eventually.

— John