Is a Big Retirement Move for You?



October 7, 2014


In a past WEALTHWISE, we discussed how you can create a new lifestyle by moving to a different part of your own city. But as a retiree, you may have an even bigger change in mind. Many retirees move to completely different parts of the country or even to foreign countries. Citing figures from the industry publication Travel Market Report, a Wharton School study reports that some 3.3 million baby boomers plan to retire abroad.


Whether you retire to Timbuktu, or just a different region of the U.S., there are numerous factors to consider. One is climate. It’s no coincidence that Florida, with its year-round warm weather, is a retirement destination for many cold New Yorkers. A dry, desert locale may be attractive to retirees who suffer from certain types of allergies.


Another important consideration is cost of living. Many retirees choose a certain place because their retirement dollars will stretch farther there. This is particularly true for retiring abroad, where some destinations boast a cost of living half that of the United States. But any move beyond U.S. borders will also be a very big change and should be thoroughly understood beforehand.


For instance, just because you live abroad doesn’t mean you can avoid tax obligations in the U.S. And the obligations to your host country will depend on whether the U.S. maintains a tax treaty with them.


Healthcare is an important concern. Medicare coverage will not generally be available to you in a foreign country. But many countries do have more affordable healthcare and health insurance than the U.S. does.


Also, make sure you understand the culture of the place you are considering moving to. This applies within the U.S. as well as abroad. Some states and towns may be politically and culturally very different from what you’re used to. Ask yourself: is it somewhere I can fit in and feel comfortable?


Last but certainly not least, consider your family and friends. They are important to your peace of mind. Will you be far away from them? How will you handle that, especially as you age and perhaps need more help with things? Technology certainly makes it easier to stay in touch, but it’s not quite the same as old fashioned physical proximity. And remember that frequent trips back to visit may overwhelm a cost-of-living advantage.


It comes down to two things if you are planning a retirement move. You need to research and understand all the myriad issues we have touched on above. And you need to spend time in your intended destination on a temporary basis first.


It helps to have a PERSONALCFO who can be your sounding board for issues such as these. At PARTNERSINWEALTH we fold together all the diverse aspects of your financial life so you can make better decisions and rest easy about your future. For more information please contact Jim Waters, CFP®, at 713.964.4028 or