My husband is 55 and 5 years away from our target retirement date. We currently live in Florida and are debating whether to move to GA. We have family there and FL is changing rapidly. We've been here for 20+ years and are sick of the heat and the housing costs are rising. GA is still affordable and homes seem to have more land. Our biggest concern is moving from a no income tax state to a state that will tax his pension. Has anyone done this and regretted the move?
That’s interesting that it worked that way for you. I’ve never seen any study where Mass had an overall lower tax burden than Nh. Actually quite the opposite.
Retirement math sometimes works differently due to the tax breaks for retirement income. For instance, PA has high taxes but does not tax pensions, SS, or withdrawals from retirement accounts so a retiree with those income streams makes out.
I did just read that PA is another destination for retirement.
Can confirm the tax side. 3 years into retirement with a mix of SS, pension and IRA withdraws. Zero state income tax in PA.
But my wife and I just left PA and moved to Massachusetts. There is more to life than tax rates.
Agree wholeheartedly. And MA looks out for its people.
Yes; for a long time it was known as Taxachussetts
That’s because it looked after its people.
Born there, got out early. Lol.
$95k? Wow, that's far more than most.
Was wondering the same thing, if this is social security only?
I’m $56,364 at age 70. I have 30 years with the maximum contribution and 5 others that are close. My partner isn’t quite as high. $38,940 at full retirement age. The total is $95,304. After ~ $5k each for Medicare, Medigap, and Part D plus the Federal tax, it’s about $80k net to spend. COLA-protected.
My Massachusetts quarterly property tax bill is due this month. $842.90. My New Hampshire one used to be 4x that amount for a similar house. Massachusetts has Proposition 2 1/2 so I’m shielded from big property tax increases.
Massachusetts has a flat 5% state income tax until you make more than $1 million. We won’t have a very big state income tax bill.
We have the same situation in California (a supposedly high tax state). Own properties in Texas (a supposedly low tax state) and California, which is our main residence. The property taxes for the Texas property alone are much higher than all the taxes we pay in CA. In Ca, Prop 13 caps my property tax increase, no tax on SS income, reasonable income tax rate on everything else. If we moved to Texas full time and bought a true replacement property for our CA home, the total new property taxes would be 2x what we pay now in CA.
I used to work in TX and I’ve never heard TX considered a low tax state. For sure a no income tax state, which I frequently see stated. But, it is well known for high property taxes and a “fee” on everything. For a senior who has owned their home for a long time, they are shielded on the property tax for their homes, but that is about it. The state has to make it up some way or another. FYI, we found the same to be true during our stint in CA. We lived in the Central Valley and it actually cost us less with the income tax. IJS—people just choose to look at only what they want.
But the house itself would cost less.
House size? Our taxes are $11k annually on 2650 sf in Texas, but a very desirable area.
My property taxes on our CA house are $2.5k (bought long ago, increases capped). We can also transfer our tax rate to another CA house if it cost less than our current house sells for. Any comparable house in Texas would have taxes near $20k.
Comparable in cost, not size. CA homes cost 5x of TX.
This is true. And our gas has doubled in value.
Not near Austin..,
Sure, let's compare Highland Park and Chico, right? Cause that's not typical
Yes. We're in upstate NY. NY doesn't tax our SS or pensions. Our property taxes are reasonable and our combined home owners and car insurance is $1500 per year. A no tax state like FL would cost us thousands more to live in. You have to look at everything and run the numbers.
My parents are in upstate NY and besides the harsh winters and lack of shopping/ Healthcare, they are pretty comfortable.
By Albany, healthcare is abundant, more than most states. And winters are easier and easier. Pretty much no snow last year until March. Most of Jan was in the 30s and 40s.
This is a great answer: it’s complicated for some people. You have to factor income, property, spending, lifestyle (travel a lot?), family, etc.
So many more things to think about!
One of the other advantages is that Massachusetts is a Medigap guaranteed issue state. This means that you can start out on a free Medicare Advantage plan, and if and when your health deteriorates, switch to Medigap. There’s still some risk because of the time frame of when in the year you’re allowed to change. Also, because of this the Medigap insurers are all required to use community pricing, which means the supplement plans cost more starting out than they do in other states.
Good news is that Georgia and Florida are both considered tax friendly. This site will estimate taxes for any state for comparison. https://smartasset.com/retirement/georgia-retirement-taxes
Thank you for that! I'll crunch some numbers.
We moved from Florida to a state with income tax, NC. Most of my income is not taxable, so we still don't pay income tax.
Username :)
Maybe I should change it to Lazy-ExFloridian
Lol.
State Income tax is the least of your worries. There's a lot that goes into the cost of living besides state income tax. With just the basic 24,000 deduction that will reduce your state income tax bill by 25%
Retired for 5 years and I live on the west coast in CA and have a home on the East Coast near Chesapeake Bay VA. And split my time between the two.
Property taxes in VA are twice what they are in CA and that home is worth three times as much. And her property doesn't get reassessed every year to full market value. Like it does in VA.
They have personal property tax on vehicles in VA, but not in CA so we pay way more for vehicles registered in VA.
Homeowners insurance is twice as much in VA. Automobile insurance is twice as much in VA. I find it way cheaper to own the home in CA.
And beer and all foods and vegetables cost way less In CA and are way fresher.......
Was it Bart Simpson that said, “Beer! Beer is the cheese!”?
Move to western Iowa. It won't help you live longer but it will seem like it did.
🤣
A lot of water activities there now, I hear.
Choose Pennsylvania instead.
I pay tax only on capital gains from my regular (not IRA) retirement account.
But I pay no other state income taxes:
- No income tax on pensions.
- No income tax on Social Security.
- No income tax on IRA withdrawals.
Yes, but Steeler fans and Eagles fans. Not worth it
Iowa is the same.
I'm not sure I can take the winters. Grew up in the tri_state area and don't miss the cold weather at all. Can't say I haven't thought about it though.
Ah! Don't forget global warming!
It might terrorize the tropics, but it's a welcome relief here in the north.
THIS.
I have lived in Georgia for over 60 years so my best advice is stay 75 or more outside of Atlanta. Inside that perimeter your car insurance will be sky high.
We're looking at coastal GA mostly. I've been pushing the search inland a bit and north towards the mountains.
Car insurance in Florida is creeping higher along with everything else.
you need to look at coastal (flood/wind) insurance boundaries with the help of an agent where you're moving to. you may decide that 50 miles is close enough to the beaches.
I pretty much know that already from living in Florida. Even Central Florida has had storm damage and flooding so hurricane/ flooding is forever on my radar. Georgia coastal isn't the same as FL but still a concern for sure.
I can’t imagine that wind/hail premiums will be higher in GA than in FL.
Not an expert but generally speaking, no income tax states aren't going to be significantly cheaper. The state government has to keep the lights on. They're getting tax revenue in other ways. On the flip side, your tax prep is simpler. I've lived in WA for 20 years (no state income tax). I think our tax burden is probably average.
I believe Florida gets a lot of tourist money..
Yep. We rely on tourism dollars here.
It’s generally a smaller tax burden the more money you have as non-income tax’s are not regressive.
Non-income taxes tend to be regressive (which favors the people with more money)
Georgia looks sweet with a retirement income exclusion.
This one should be higher for OP to see. Might not have much to worry about as far as taxes.
Now, heat and humidity along the Georgia coast may not be much of improvement over Florida.
As others have noted, it depends.
I retired and moved from California ( a state where many love to criticize for high taxes) to Washington where there is no state income tax but property tax is much higher. Neither state taxes Social Security. Overall it is about the same. Ironically, California is comparable to Florida for lower income folks because they pay nearly zero state income tax and property tax is low.
We are in California and had planned to move out of state. Prop 13 protected property taxes, low mortgage rate and friends and family as well as healthcare we know. For now we are staying because I’ve learned that something cheaper in one place tends to get replaced with something just as costly in the new place.
I never felt life was more expensive in California other than housing it that is largely because it is a place everyone wants to be in. Bought in Palm Springs in the 80s and prices were well below Inland Empire because it had not gotten hot with Mid Century and the hipster culture. We only moved because the kids moved.
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It adds up.
HOA fees are what makes Florida unaffordable. We're renting now and even if we purchased something in our target price range, the HOA fees overextend us. Fees are typically $400-600 a month here.
HOA fees are dependent on a variety of factors. Age is the key factor as old properties require significant refurbishment. I live in a condo that was built in 1981. A few years ago we had a new roof put on that created an assessment of $10,000 per owner. There were screams of rage. Dues were raised to replenish the reserve account and save for future repairs. Now we are facing the job of re-siding the building. Estimates suggest a $35,000 assessment at a minimum. This is all because owners in the early days did not want to save for future repairs that would benefit future owners. In Florida, since the condo collapse, assessments have skyrocketed to eye popping levels. But then living in a SFH outside of a condo association just means you pay 100% of repair costs. TL;DR If looking at a condo of HOA situation, see how old it is and see what their reserves are.
Yikes. Those assessments are scary.
Depends on where you are in FL: my HOA is 12 ( not a typo) dollars a month!
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Florida taxes lower income people the most.
There are extra penny sales taxes and many of the counties.
There are toll roads.
There are impact fees.
There is tourist tax.
There are HOA fees and fees developers stick on homeowners
Beware of states that didn’t expand (a word I’ve been warned I can’t use)
We moved from Illinois (no tax) to Arizona (tax). Off the top of my head, the first pro to this is the savings on property tax ($6,900 in Illinois, about $2,000 in Arizona) for the same size house. The difference zeros out the AZ income tax. We don't miss those cold winters, our daughter & family are here, win-win all around.'
Caveat: car registration in AZ is based on car value, where Illinois is a fixed rate. If you buy a nice car, you will be paying hundreds each year as opposed to $100+.
Huh? Illinois has a state income tax of flat 4.95%, higher than the AZ flat tax of 2.5%. Unless you're talking about specific income that isn't subject to tax in IL, like pensions. And of all the states with an income tax, AZ's is one of the lowest. Every state has quirks in taxation, and two people with equal income may have very divergent tax situations, depending on what makes up that income. For example, in AZ, a retired postal worker doesn't pay tax on the first $2500 of their pension. A retired servicemember doesn't pay any state tax on their pension.
Sorry, should have clarified that I meant pensions.
Wow. So interesting.
We live in Georgia. Once you hit 62 you are not taxed on Social Security, 4,000 of earned income and 35,000 of retirement income. 70,000 if married. Then when you hit 65 it’s $65,000 or $130,000 for married couples. So depending on your retirement income you may not pay any income tax.
That's encouraging!
*state income tax
I’m in Fl and moving to PA…for the same reasons you want to leave; plus don’t like the governor. In PA if you are retired or over 65 you don’t pay state income tax
I feel the same. The state has changed in the 20 years I've been here and while we would consider staying if we could afford a decent home, the real estate market is ridiculous right now. My husband is fond of Pittsburgh, maybe I'll toss PA into the hat.
I’m buying in Greenville, just northeast of Pittsburgh. In my FL neighborhood there are 6 homes for sale in a 2 block radius. What does that tell you? If you make the move, you should dm me so I can make some new friends. I live in Pittsburgh in the 1960’s and visited often since because my Mom lived there. It’s a nice city; greatly improved
I have coworkers from Pittsburgh and they really love it. I'm not sure we'll make it that far north but who knows.
I’ll be fine in any case…I want to step back in time…
I retired from Florida 2022. moved away to NY (yes NY upstate). The state taxes will be noticeable on his pension. But the move from south Florida was a welcoming change for me and my family. Spent 22 years Florida and now I embrace the changing seasons. I have not regretted the move and still happy as a clam. Have not returned to Florida since and don’t plan on it. Best of luck
Depends on your income. I think you have $65000 per year exemption after 65. So if the social security and pension is below that, no tax.
It’s 65,000 per person and that doesn’t include social security. So say you have $130,000 of retirement income and $50,000 in social security you wouldn’t pay any income tax. You could even get small part time job and make $4,000 and that wouldn’t be taxed. Now those numbers are set so I suppose 20 years from now $130,000 might not seem like a lot..
Social Security is not taxed in Georgia.
Right. Thats what I was trying to say.. I guess my example wasn’t very clear.
Thank you. I've read about the exemption. Alot of my husband's coworkers are telling him it's a bad move simply because of the income tax issue.
Home insurance will be a lot cheaper. Depending on where you live, homes too. Georgia is still extremely hot in the summer too, with high humidity, and you get much colder winters. I suggest also looking at Tennessee (no income tax) as well homes which are still reasonable outside of metro Nashville, and still within easy (2 hrs) driving distance of Atlanta if you live close to the border (e.g. Chattanooga) .
So so many people here are talking about retirement in TN. Almost seems like a FL cliche. I've looked a little bit but still more apt to pick GA mostly because my grandchildren are there.
Keep in mind TN sales tax makes up for income taxes. Most populous counties have a total sales tax rate of 9.75%. 7% statewide, and local jurisdictions can tax up to 2.75%.
That said, simply focusing on income tax doesnt give you an accurate picture. You need to look at total cost of living, and your lifestyle, to judge if one area is cheaper than another.
Well, your property taxes will go down. Your treasury bills will be a better value to you.
Not necessarily. If you bought 20 years ago and landowners in Florida, you are likely paying nominal taxes for the annual increase is limited and not based on current values. When you move to GA, you property tax will be based on the sale price. Your property taxes may go up, depending on the value of the home in GA
You have to look at the whole picture and the cost of living in a particular area. I’ll just list a few points on my relocation after retirement.
Nebraska has income tax and property tax, sales tax. For me, being retired military, the state excludes my military pensions from income tax. The old people part of the Homestead adjustment for property taxes is a sliding scale based on your Nebraska income tax form. Our state income tax was zero last year, and our property taxes for last year were zero.
Grocery stores are not competitive, so prices are relatively high. Gasoline was $3.27 last fill up. It is 25 to 60 miles into a town for in person shopping, depending on what store you want. We have very little crime, most of it from outsiders passing through on the interstate.
Available local healthcare is excellent. We have family coverage for life, so I don’t know the cost as we never get any bills.
That's fantastic. I'm familiar with the military healthcare for retirees. Healthcare an unknown for us at the moment. We live in an area that is saturated with health facilities and moving to a more rural area may be a challenge. More to think about.
The bulk of my retirement income is Social Security, which is non-taxable in Massachusetts.
I draw about $8,400/year from an IRA, which is taxed at 5%.
Massachusetts has a $4,400 per person personal exemption plus another $700 per person for over 65. You’re paying 5% of $3,300 as state income tax if you’re filing single. $165. No taxes at all on a joint return.
Good to know.
We use TurboTax, and my wife does it all.
I get a modest annual mandatory distribution of about $1,00 a year from an inherited IRA. Our money guy has taxes withheld. 1
It's been awhile since I left Florida, but I found no state income tax was more than offset by much higher insurance for auto and homeowners, higher government fees for stuff like vehicle registration, tolls, and sales tax. I'm not sure what the income tax rate is in Georgia but I think the difference will be minimal or non-existent.
We moved from Florida to NC thanks to hurricane Ian. Yes, there is an income tax here BUT:
We are more than adequately insured and it is 5000 less than the nonsense garbage that passed for insurance that we had. That was also a year ago so I’m sure it is higher now.
Property taxes here are far lower. Again, down 1000 from where we were.
Car insurance is also less than we paid in Florida for a better policy. We are saving about 500 a year.
We would have to spend over 6000 on income tax to make it more expensive than we would have had in Florida. That’s a LOT. Add in that housing, food, utilities and incidentals are less expensive and it makes sense.
Run your numbers but it’s really not as big a horror as it seems.
Hurricane Ian is what caused me to want to leave FL. I don't want to dread hurricane season every year for the rest of my life. That and the ridiculous price increases of every single thing. Condos in our neighborhood went from $250k to $500k right after the pandemic. Makes no sense at all.
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Moved from Georgia to Florida and all in on taxes we pay a little less here in a coastal area. Like not paying the 6% state tax which would be a bigger hit had we stayed.
TRY a 3 month or 6 month GA. Rental. If you love it, then buy and sell your Florida residence, move and retire. Your goal is 80% of current income for a 20 year worry-free retirement. #1 expense is Medical so Medicare plus a supplement and move near excellent doctors and hospitals. Being near family is the best! Good luck! One of my client’s just did this and loves Georgia!
Thanks for the optimism!
I moved the other way and frankly I’m paying more in taxes now. They are just different taxes. I’d rather pay income taxes frankly; those are fairer for the middle class. The years before you move, you may as well take out more from your IRAs than you need, using up whatever fed tax bracket you are in.
Life is too short to let the tax tail wag the life dog.
Live where you want to live, within your means.
I earned my money so I can live in the world’s best climate, with among the best recreational options, restaurants, global transportation, etc.
You get what you pay for.
Do I pay huge state taxes, sure. But those taxes also fund services which make the community better as well. Low tax states often have horrible services and minimal resiliency for disasters or public health crises, etc. For example, during Covid my are never ran out of hospital capacity and funded excellent vaccine outreach, reducing deaths. The state pays closer to living wages for public works, which keeps the middle class going to a large degree.
Also, as mentioned many income tax less states ping in other areas like high RE rates or sales taxes.
No income tax usually means higher property tax so compare what you’re going to pay in income tax in GA compared to the property tax in GA compared to FL.
Look at all expenses. I lived in AZ for a decade and moved back to FL. We had state income tax in AZ. In addition, things like auto tags were crazy expensive. But property tax, auto insurance, property insurance, etc…. were lower. End of the day it was pretty much a wash for us.
We recently moved from Florida to LA (lower Alabama) and the personal income tax we will now pay is offset by much cheaper auto, homeowners and health insurance. The real estate tax savings compared to Florida ($15k to $5k, same value of a home) is actually putting money back into to our pocket.
The Google machine says that Social Security retirement income is taxed in only the following states in 2024: Colorado, Connecticut, Kansas, Minnesota, Montana, Nebraska, New Mexico, Rhode Island, Utah and Vermont.
Im thinking about Utah . . .
As others have posted, you have to look at the totality of the circumstances if trying to find a "low tax" state.
Has anyone done this and regretted the move?
We have just done something similar. Left PA (zero state income tax for retirees) and moved to MA (Taxachusetts). No regrets so far.
First, as other have said reality can be very different from rumor, so run all the tax numbers yourself. Second, to a degree you get what you pay for in terms of infrastructure and services.
But the most important thing is that tax rates should not drive your life. IMO, anyway. Family is important, especially once retired.
I agree. I'm driving 8 hours each way to visit my grandkids right now and I do this at least 4x a year. I can't imagine doing this as I get older. Trying to shorten the length of the commute and beat the sweltering winters.
Yep. That was our situation (other than the winter part). And now we see the grandchildren regularly, but more importantly we can backstop our kids. And since we have moved it is pretty much every week that there is some little thing that we can help with.
One thing I do suggest. We didn't do this, but if I had it to do over I would 1/move only what I wanted to take, then 2/have an estate sales and cleanout firm come in and clean out what is left. Trying to work the "sell, donate, dumpster" part of moving out of the house that we raised the family in was very difficult.
Thanks for the advice. I've started cleaning stuff out now (because we anticipate a move here before a move out of state) and it's already overwhelming. We have so much stuff that we've accumulated and paring it down is daunting!
PA here. We’re at about $84k including SS, small fed retirement and RMDs. Quarterly fed is $650. No PA or local income taxes.
One practical point is that if you do move, then unless you move around New Year’s, make sure you file a part year return. I’ve seen people make the mistake of filing a standard full year return for the year of the move, and then get charged tax on their entire year’s income instead of just the part of the year they actually lived there.
Also, if you’re planning any stock sales or retirement fund withdrawals, do those before the move (unless they wouldn’t be taxed in the new state anyway).
Great tip! Thanks
We moved from Florida to Georgia two years ago. We are similar, we retired at 55 and had lived in Florida forever. We found the move to GA to be not that big a deal. Yes there is a state tax, and we’re not crazy about that, but our home and car insurance was and continues to be significantly lower than what we paid un Florida. We live in Athens, so a college town, tons of things to do, never a dull moment. Having a real change of seasons is amazing. It's hot like FL right now, but unlike FL, there will be fall, winter, and spring, and it lasts, unlike Fl. Definitely pick a town that caters to the things you enjoy and the things you want to do during your non working days. We picked Athens for sports, food, music, arts, and nature. Yes, our yard is much bigger than ours in Fl, and what you plant actually survives (well, the deer have definitely eaten quite a bit of what we planted but we love our daily deer visits). Our move came with a 'two & five year rule.' If.in two years, we hate it, we move again. If in five years we absolutely love it, we still consider moving as there are fewer years ahead of us than behind us. I'm pretty sure we'll end up back along the coast in a cooler state. What do I miss about Florida, being close to family and sunsets. I really miss sunsets.
I'm torn about eventually leaving. There is so much to love about Florida BUT the heat is too much and the weather is becoming unpredictable here. Most of my family is scattered all over the US so moving is easier. I'm looking near Savannah (suburbs of) but would really love a small town with arts and hiking trails. I'm constantly looking!
I get it, we did not want to get to an age and look back saying,'If only we had ...' Florida will always be a special place to us, but it's not the Florida we grew up loving and enjoying. It's changed dramatically in so many ways and not for the best. Best of luck to you on your decision.
Thank you!
Don’t sweat the taxes. All states need money to operate and they get it somehow. Don’t decide where to live based on taxes. Choose based on the type of life you want to live in retirement. I moved to a higher income tax state that doesn’t have sales tax and has lower property taxes. It all washes out.
Georgia won’t be much cooler. Lived in both states a long time.
I'm almost in the Everglades in Florida. I'll take an 85 degree summer day over a 100 degree day.
85, you are so funny.
Georgia doesn’t tax SS payments and has some other tax breaks for folks over 62.
Thanks!
Check out grocery prices too
Grocery prices are killing us. A large portion of my income covers grocery bills. The expense is substantial. Pre-pandemic I worked in a grocery store and enjoyed a 20% discount. Really missing that these days.
We pay 20% less in our new state vs Florida, where we lived before we retired.
Groceries there are stickin’ it to the people.
Yes, as others have said, you need to consider the whole picture. Some states that have income tax do not tax much of what would be retirement incomes.
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It’s the whole picture as others have said including what you give up in the non tax state. We moved from NY to Ohio. Yes, income taxes are less but what we gave up in terms of services from the state as well as local services, access to quality healthcare, etc. erase any perceived savings.
Access to Healthcare is a worry for me. We're literally surrounded by Healthcare here. The area in GA is rural so I assume we'll have way less options.
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You have to look at the whole equation. Income tax. Sales tax. Property tax. Homeowners insurance. Car insurance and other car costs. There’s no one correct answer. I moved from New Hampshire to Massachusetts because the retirement math worked better. My New Hampshire property tax bill dwarfed the combination of Massachusetts property tax, income tax, and sales tax. We project to have $95k in combined Social Security income that has no state income tax. There are a lot of alleged high tax states that have big breaks for seniors. You have to do the math for your particular scenario.