How Should I Financially Plan to Move in Retirement?

Moving and retirement are both big changes.

For years you have been tied to the same location as your employment.

You have been “following the money,” so to speak.

As retirement nears, you are wanting to move to a destination you have always loved.

I guess we could call that "following your heart"?

According to a 2014 study from Merrill Lynch, you are in good company.

The study is reported in a recent article from CNBC titled “A financial flight plan for snowbirds.”

Twenty-seven percent of the retirees surveyed said they were planning to move to another state in the near future.

Fully one-third of respondents had already moved.

If you are going to join their ranks, you need to plan.

For example, are you going to be selling your home or merely purchasing another one?

Although you can have two homes in different states, you need to decide on one as your primary residence.

You will want to weigh the pros and cons of each state.

Income taxes, real estate taxes, and estate taxes can be significantly lower or non-existent in certain states.

You will likely need to provide proof regarding the state you have selected as your domicile.

The government will look into your case to ensure you are being truthful.

Why?

Both states may want to tax you.

What steps can you take?

Change your driver’s license at the DMV.

Update your mailing address.

Also, remember to change your tax return address and voter's registration, too.

The government shares information and inconsistencies could cost you a lot of money.

Estate planning will vary depending where you live—especially if you own property in more than one state.

Be sure to find an experienced estate planning attorney in your new location.

He or she will be able to provide a smooth transition, as there may be some unique legal nuances to navigate in your new state.

Your automobile insurance may require few changes to ensure full coverage as well.

One last bit of advice.

Consider your relationships before you move.

Will you be okay with phone calls and FaceTime or will you miss consistent face-to-face interactions with the grandchildren?

This is a big decision.

Do not rush into it.

Follow your heart ... but do not leave your brain behind.

Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.

For more information about estate planning in Overland Park, KS (and throughout the rest of Kansas and Missouri), visit our estate planning website and be sure to subscribe to our complimentary estate planning e-newsletter while you are there.

Reference: CNBC (December 8, 2016) “A financial flight plan for snowbirds”