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Retirement Questions: Should You Move or Stay in Your Home?

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One of the most important decisions couples must make in retirement is whether to stay in their current home after they retire or move somewhere else. While the term “snowbirds” has often been used to describe older Americans who move to warmer climates after they retire, a growing number of older Americans say they want to “age in place” by staying in their home, instead of downsizing or moving into a retirement community.

In a survey conducted last year by the American Association of Retired Persons (AARP), nearly nine out of 10 respondents age 65 or over said they would like to stay in their current residence for as long as possible. And in a survey conducted by Freddie Mac in 2016, six out of 10 respondents age 55 or over said they were very satisfied with their community while two-thirds said they were satisfied with their current home.

There are lots of different factors to consider as you decide where to live during your retirement years. Here are five of the biggest:

  1. Your and your spouse’s health condition — This could play a major role in whether you can remain in your existing home or need to find a home that can accommodate any physical limitations. For example, if you or your spouse has trouble getting around and you live in a two-story home, you might need to move to a single-story house. If you really want to stay in your home, you might be able to make renovations or retrofits, such as widening doorways or installing grab bars in the shower.

Meanwhile, there are some health conditions that might be improved by moving to a change in geography. Many people who suffer from asthma, for example, can live a much higher quality of live in the dry southwest.

  1. The importance of proximity to family — If being close to children, grandchildren or other family members is a priority, you’ll need to factor this into your retirement living decision. However, make sure you talk to family members to find out what their long-term plans are. You don’t want to make a decision to move and be close to family only to out that they plan to move soon after you arrive.

You should also think about which family members might be willing and able to help care for you or your spouse after one of you dies. These are hard conversations to have with children — but it’s better to have them now when plans can be made in advance than later after a spouse has passed on.

  1.  Your financial situation — If you have been in your home for a long time and have a small mortgage payment (or no mortgage payment at all), staying where you are could yield tremendous financial benefits. This could be true even if you have to retrofit your home to accommodate physical limitations.

Conversely, if you reside in an area of the country with a high cost of living, moving to an area with a lower cost of living could help stretch your retirement dollars further. State income taxes are a big factor here — many retired couples save thousands of dollars a year by moving to one of the nine states that collects no state income tax. Currently these states are Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming.

  1.  Your friendships and relationships — One of the biggest drawbacks to moving for many retired couples is leaving behind friendships that they’ve built over many years. If you have lived in your home for a long time and have lots of close friends in your neighborhood, pulling up stakes and starting over again could be difficult — whether you’re moving across town or across the country.

On the flip side, moving might offer an opportunity to make new friends and acquaintances. This is especially true if you move into an active retirement or country club community where you can meet lots of other folks with the same interests as you.

  1. Your lifestyle preferences — If you and your spouse enjoy outside recreation, then you will probably want to live somewhere with a moderate climate throughout most of the year. Many retirees who live in northern states do just this, moving south to Florida as snowbirds where they can play golf or tennis and enjoy the beach and boating year-round.

You and your spouse should take time now to think about how these and other factors could influence your decision about whether to move or stay in your home after you retire.

The commentary is limited to the dissemination of general information pertaining to Frontier Wealth Management, LLC’s (“Frontier”) investment advisory services. This information should not be used or construed as an offer to sell, a solicitation of an offer to buy or a recommendation for any security, market sector or investment strategy. There is no guarantee that the information supplied is accurate or complete. Frontier is not responsible for any errors or omissions, and provides no warranties with regards to the results obtained from the use of the information. Nothing in this document is intended to provide any legal, accounting or tax advice and Frontier does not provide such advice. This information is subject to change without notice and should not be construed as a recommendation or investment advice. You should consult an attorney, accountant or tax professional regarding your specific legal or tax situation.