Now, before you turn your nose up at the topic, we aren’t talking about senior living communities – those group homes for baby boomers and their elders where they take a little bus to Walmart once a week and someone else does all the cooking.
We’re talking about retirement communities – for boomers who are active and independent and want to downsize yet still be around people their age. They’re sometimes called “55+ communities.”
Yes, it’s the one case that a community can legally discriminate by saying “no youngsters allowed.” At least to live there.
Recent studies show that many boomers prefer to retire to urban centers, where they can be around a diverse age group, walk where they need to go and take advantage of the cultural and dining experiences that downtowns have to offer.
But, there’s still a big chunk of retirees who choose retirement communities so they can hang out with folks who share a common historic and cultural perspective. People closer in age.
Whether it’s a resort retirement community, a golf course community or a typical neighborhood-type community designated for “seniors,” there’s a lot to consider when buying a home in which to spend the rest of your life.
Will you relocate?
Spending an occasional holiday in a certain region and settling in for year-round living are two entirely different things. Even in the balmiest cities, there are changes in the weather and climate that you may not be familiar with.
For example, have you ever heard of Boise, Idaho’s inversion layer? It’s an atmospheric condition that traps polluted air in the valley, making it unhealthy to breathe for some residents.
The layer also traps moisture, creating “dense fog and gray, sunless days that we can get in the winter,” according to the Argus Observer online.
Even in what seems to be the “endless summer” of Hawaii, “vog” can hang in the air on the Big Island during volcanic eruptions. Oh, and the dust – covering windshields and even your indoor furniture.
While these are seasonal or event-dependent considerations, they are considerations, nonetheless. Learn all you can about the climate, weather and other events that may impact you, especially if you have an ongoing respiratory illness.
Then, spend some time in your choice of retirement cities during the off-season. For instance, spend an August in Florida to ensure you can tolerate the humidity, visit Arizona in early spring if you’re an allergy sufferer.
Oh, and if super-hot weather doesn’t agree with you and you have your heart set on retiring in Henderson, Nevada, visit during July when the average temperature is 105 degrees.
Who else lives there?
If you’re toying with the idea of buying a home in a “resort-style” retirement community, you’ll be spending more time with your neighbors than you would if you chose a standard 55+ neighborhood.
Tour the area during the times when the social activities you’re interested in participating in take place. Strike up conversations and study the group. See if these are people with whom you have a lot in common and with whom you’d like to spend more time.
While many of the homes in these types of retirement communities are of the condo variety, those that offer single-family homes frequently come without fences between neighbors.
In a standard neighborhood type arrangement, drive or walk through the neighborhood at different times of day and do stop and chat with any residents who are outside.
Do you need nearby medical facilities?
Sure, this seems to be a no-brainer when choosing where to retire, but you’d be surprised how many people fall in love with a community that isn’t convenient to needed medical care.
The financial considerations
If there’s one thing that can greatly impact your income during retirement it’s taxes. To estimate your monthly obligations, including your new mortgage payment, requires careful consideration of taxes.
Seven states currently have no state income taxes:
- South Dakota
Add Tennessee to the list, starting in 2021. While New Hampshire doesn’t “tax an individual’s earned income (W-2 wages),” it does impose a 5% tax on income from interest and dividends, according to BankRate.com.
But lack of a state income tax shouldn’t be your only consideration when thinking about paying as little tax during retirement as possible.
Buying even the least expensive home in a retirement community may not be worth it if that community is located in a state that taxes Social Security benefits, pensions and retirement plan distributions.
Since you’re buying a home, first look into property taxes. These can add greatly to your monthly mortgage payment.
Kiplinger.com offers a list of 10 Most Tax-Friendly States for Retirees and USAToday.com compares Average Property Taxes for all 50 States and D.C.