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Anyone move to avoid property taxes in retirement?
Posted on 8/20/21 at 9:30 am
Posted on 8/20/21 at 9:30 am
My house will long be paid off by the time I retire but taxes in Texas are insane. In a few years I'll be paying more in taxes than mortgage.
Anyone else consider moving to a state with low property taxes in retirement?
I know there's a tradeoff with other taxes (income, etc.) but I still think it might be worth it.
Still don't really understand how income tax is calculated when you're not working but just taking money from retirement accounts.
Anyone else consider moving to a state with low property taxes in retirement?
I know there's a tradeoff with other taxes (income, etc.) but I still think it might be worth it.
Still don't really understand how income tax is calculated when you're not working but just taking money from retirement accounts.
8
Posted on 8/20/21 at 9:36 am to ghost2most
Property taxes are one of the reasons I'm thinking of moving. Of course our other taxes are among the highest in the country too.
Posted on 8/20/21 at 9:36 am to ghost2most
quote:
Still don't really understand how income tax is calculated when you're not working but just taking money from retirement accounts.
Any money you take out of pre-tax accounts (401Ks, traditional IRAs, etc) are treated as ordinary taxable income. IE if you take 60K out of your 401K, that is the same as making 60K to the federal government.
Roth 401Ks and Roth IRAs are a bit different since you already paid taxes on that money and can be withdrawn tax free.
Posted on 8/20/21 at 9:48 am to UltimaParadox
quote:
Roth 401Ks and Roth IRAs are a bit different since you already paid taxes on that money and can be withdrawn tax free.
Simple enough. So in Louisiana you have federal and state income tax but your property taxes are almost nothing.
What about healthcare subsidies through ACA? If you're pulling out say $60K from your retirement accounts, is that considered your income and your rate is based on that?
This post was edited on 8/20/21 at 9:51 am
Posted on 8/20/21 at 11:53 am to ghost2most
Property Taxes are just one piece of the financial pie. I would calculate all of the financial aspects together first and then decide how much you really like to live where you currently do.
Additionally, I'd consider strongly where your kids live. I know multiple people that have recently moved closer to their kids from another state.
Additionally, I'd consider strongly where your kids live. I know multiple people that have recently moved closer to their kids from another state.
Posted on 8/20/21 at 12:37 pm to baldona
quote:
Additionally, I'd consider strongly where your kids live. I know multiple people that have recently moved closer to their kids from another state.
Most definitely. People don’t give enough thought when it comes to having help close by as you age. Simple tasks such as yard work can tax you and if you should fall sick it could mean the difference of staying home or being put into a nursing home. That is if your kids aren’t pieces of shite and are willing to help you.
Americans would actually build more generational wealth if we took in our parents as they age. Had this discussion with my Indian friend. They have no social services there so parents when they age hand over the business to their children and move in with them. Cheaper to maintain one large home than two average american homes. Also gives you help with your own kids.
This post was edited on 8/20/21 at 12:41 pm
Posted on 8/20/21 at 12:39 pm to ghost2most
Just go down to the office and act all cripple and they’ll put you down for double homestead exemption
Posted on 8/20/21 at 12:54 pm to ghost2most
quote:
What about healthcare subsidies through ACA? If you're pulling out say $60K from your retirement accounts, is that considered your income and your rate is based on that?
This is where a sit down with a competent retirement planner can be worth it.
Posted on 8/20/21 at 12:57 pm to bayoudude
quote:
Americans would actually build more generational wealth if we took in our parents as they age. Had this discussion with my Indian friend. They have no social services there so parents when they age hand over the business to their children and move in with them. Cheaper to maintain one large home than two average american homes. Also gives you help with your own kids.
This sounds like cockblock central.
Posted on 8/20/21 at 1:15 pm to ghost2most
If there is one thing I have learned in my years on this earth, govt gets it's tax dollars one way or another.
Now they waste 75% of it, but they still take it.
Now they waste 75% of it, but they still take it.
Posted on 8/20/21 at 1:28 pm to el Gaucho
quote:
Just go down to the office and act all cripple and they’ll put you down for double homestead exemption
Go on...
Posted on 8/20/21 at 4:05 pm to baldona
quote:
Additionally, I'd consider strongly where your kids live.
We spend the majority of our adult lives working and in some cases following our jobs to less than desirable areas.
Not to mention all the people on the O-T that constantly say: If it weren’t for my kids I would have gotten out of Baton Rouge (or Louisiana) a long time ago. A good amount of people on there have a countdown to when their kids finish high school to leave and move somewhere they’ve been wanting to live for years.
So after all of this is said and done, we have to work our whole lives and save money but then strongly consider where our kids live?
I dreamt about having grandparents that lived along the coast in a nice beach city or someplace cool in the mountains to spend the summers there.
Not to mention, what if your kids live somewhere you truly don’t want to live and they are stuck there for a job?
Retirement is when you’re finally able to say I’ve sacrificed so many things in my life, now it’s my turn to to live where I really want to.
Posted on 8/20/21 at 4:18 pm to ghost2most
quote:
What about healthcare subsidies through ACA?
how early before 60 are you looking to retire? Biden is looking to lower the age of Medicare
Posted on 8/20/21 at 4:38 pm to ghost2most
quote:
In a few years I'll be paying more in taxes than mortgage.
I have great news for you. You’ll find the fountain of youth is located in the same state where property taxes are less than a paid off mortgage.
Posted on 8/20/21 at 4:39 pm to ghost2most
Homestead is just a la thing but it’s like 75k so you just go and spin a sob story at the assessors office and they might give you a break. I mean 150k off property tax is significant
Posted on 8/20/21 at 4:41 pm to The Ole Cowboy
quote:
Retirement is when you’re finally able to say I’ve sacrificed so many things in my life, now it’s my turn to to live where I really want to.
Manchac but walking distance to Ivar’s isn’t a real place
Posted on 8/20/21 at 4:51 pm to ghost2most
I bought a house in CO Springs last year. I sold my house in ATX because I didn't want to die in this horrid town. My taxes on a house I bought for $168k (paid off long ago) are closing in on $10k a year. So I basically buy my house again every 15 years. Traded it for 5 acres in a CO town thats probably more conservative than anywhere I've been in TX the past 10 years, sadly. I'd rather end up in a very red area of a beautiful blue state than say I'm from TX and its the place to be. It WAS the place to be. Anyway, to the OP's question, I now pay about $2k a year for a larger house and 5 acres than in TX and yes it was a consideration. $8k per years in saving pays for alot of extra needs.
Posted on 8/20/21 at 8:09 pm to ghost2most
quote:Sort of. We have two nice places. Main home has remained relatively flat price-wise. Numbers escalated much more on our second home, so we swapped permanent residences. We'll still get tagged with major cap gains on the sale there, if/when we do sell. But at least it will maximize our one-time exclusion. In the meantime, the switch drops our property taxes a good bit.
Anyone move to avoid property taxes
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