Best Rretirement States

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Although it is obvious that many seniors prefer the warm climate and leisure activities of states such as Florida and Texas, they are not necessarily the best for retirement planning locations, especially if income is concerned. Many retirees judge the suitability of a state based simply on whether or not it has an income tax. This is an oversimplified way to judge the tax burden of a state, and can lead to paying very high amounts each year in taxes. With a little investigation you will find that states that do not impose income taxes upon their citizens, will find other ways to make up for it in other taxes.

People who have retired find it important to become more aggressive with their savings and look for states such as Pennsylvania, where there is no charge for people receiving retirement income. Although this is an understandable reaction, failure to look closer can cost these seniors a great deal of money. Pennsylvania is one of the more expensive states for people to live in the continental United States. Even with the property tax relief released in April 2008 of $169. per household, the average property tax in Harrisburg, PA is still around $6,000 annually. Combine that with $840 on average in sales tax, and Pennsylvania residents are typically paying around $7,391 in taxes per year, depending on their annual income.

There are states that are more economically friendly to seniors, such as, Arkansas, and Delaware. Annual taxes in Delaware range from a minimum of $75.00 to a maximum of $165.000 and homeowners in Dover, DE pay an average of $543 in annual taxes. Another place to find good retirement locations that is more friendly in taxes would be the state of Kentucky, the average resident senior pays around $1,000 in taxes per year. This is much less than supposedly tax friendly states such as Pennsylvania and Florida. Residents of Florida pay around $3,424 per year.

Although income tax is a major component of the overall tax burden, it is very important to take other factors into account. It is important to research not only the cost of home, but also what the average cost of living will be in your desired place of retirement. States with higher mortgages due to property taxes can be a long financial burden many are not able to bear. Avoid paying too much by researching state tax laws before making a move.

Resources such as Kiplinger and Taxsites.com can help greatly in the search for the best retirement states. Finding the best retirement friendly states is all about striking a balance between taxes and livability. Now that you have some good starting tips to help you make a good choice for a retirement location, you may want to enjoy a few of my favorite retirement quotes: “Retirement: That’s when you return from work one day and say, “Hi, Honey, I’m home - forever” - Gene Perret. Another is: “A lot of our friends complain about their retirement, we tell ’em to get a life” - (Larry Laser).

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