Finding The Best Retirement States
Although it is obvious that many seniors prefer the warm climate and leisure activities of states such as Florida and Texas for nationwide retirement solutions however they are not necessarily the best where income is concerned. Many retirees judge the suitability of a state based simply on whether or not it has an income tax. This is an oversimplified way to judge the amount of money owed each year to the state Some of the states that have no income tax more than make up for it in other forms of tax.
Retirees naturally seek to preserve as much of their money each year as possible, and many are drawn to states like Pennsylvania that do not charge anything on retirement income. Although this is an understandable reaction, failure to do some research can cost these seniors a great deal of money. Ironically, Pennsylvania is actually one of the most expensive places in the United States to live. The average property tax in Harrisburg, PA, amounted to an unbelievable $6,551. Combine that with $840 on average in sales tax, and Pennsylvania residents are really paying around $7,391 in taxes per year.
Surprisingly, states like Arkansas and Delaware are really the most affordable for seniors.For example if you live in Dover, DE, the avereage cost is around 0 for taxes. Kentucky is another affordable state for seniors, with residents of Frankfort paying around $1,114 per year. This is much less than supposedly tax friendly states such as Pennsylvania and Florida.People living in Florida pay nearly 00 per year.
Despite the importance of tax income, it is very important to take other factors into account. Be sure to research the cost of homes, as well as cost of living. In areas with high home prices, property tax can really end up costing an arm and a leg each year. Look out for potential money sinks by researching state tax laws before making a move. The general livability of a state is also important.
Online sources such as Kiplinger and Taxsites.com can help greatly in the search for the best retirement states. Finding the best retirement states is all about striking a balance between taxes and livability. Just because a state has the lowest taxes doesn’t mean you should move there, but don’t neglect to check out a state’s tax laws before moving. Some states, such as Pennsylvania, can quickly eat away at your retirement fund if you are not careful.
