Moving Out Of Your Home Can Lower Your Retirement Expenses

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Starting retirement generally means the kids are no longer at home and your income is lower. So you don't need the big house any longer and you're looking to lower your living expenses to make your income go further. This means moving! But consider these options for moving on out...

-Buying down:

Obviously, you should buy a less expensive house. If you still have a mortgage on your current house, limit your new house choice so you have no - or very little - mortgage on it.

If you don't want the trouble of yard upkeep, get a condo but watch out for condo fees. They can rise fast. Hopefully your new utility fees will be smaller too.

-Moving to a city:

Living in a city with good public transportation can allow you to dispense with the costs of a car and insuring it too - a major expense. But you'll still have to pay transportation expenses in the form of subway, bus, or taxi fees. So get a good idea on just how much these will add up to.

-Moving to a state with no state income tax:

Though your federal income taxes are the same everywhere, state taxes vary. Theses state-based taxes are its income tax, its sales tax and the real estate tax on your property.

Watch out for states with little or no income tax. They often make up what they don't get in income tax by having high real estate taxes; so, in those states, what you save in state income taxes, you may pay in property taxes.

-Moving to another country:

Many countries in Central and South America present low living costs - for real estate, goods, and services. Local health service can be quite inexpensive too. Living there can truly make your income go a lot further.

Medicare payments generally won't pay for foreign health care. So you'll have to fly back to the states for any care for which you must rely on Medicare to help pay.

As a U.S. citizen, you're still obligated to pay U.S. income tax. You can get an exclusion for earnings generated in your foreign country - if you're going to work there. But as a retiree, you'll rely on Social Security and a pension income from a U.S. source. The latter is always subject to U.S. income tax no matter where you live.

-No matter where you move Be sure you can accommodate a lifestyle you want or need. This includes:

* reasonable access - to family and to enjoyments like museums, skiing, golfing, etc.

* acceptable weather - perhaps not too hot or not too cold

* a sense of community - for you that you can feel apart of

* any specialty health care you must close access to

Now go and enjoy.

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