Thinking About Moving Closer to Your Kids? 4 Financial Implications to Consider
Maybe you have a good base of friends where you live now, but your children have moved away. As they continue to grow families of their own, you may consider moving closer to your children and grandchildren. If so, there are some financial considerations to keep in mind.
Consideration #1: Cost of Living
Complete a cost comparison between where you live now and the area where you’re thinking of relocating. What are real estate prices? You’ll want to determine how monthly expenses like health care and insurance will vary as well.
Check out local restaurants, grocery stores, shops, and any other daily expenses that will impact your budget.
Consideration #2: Housing
One of the biggest considerations you’ll need to make is what your living situation will be. Will your child move you into an in-law suite? Or do you need to weigh the pros and cons of renting versus buying a home? When you’re looking for housing, you’ll also want to consider functionality. Will you be hosting celebrations and holiday dinners in your home, or do you primarily plan on spending time over at your child’s place? If so, then you may find it best to downsize to a condo or apartment.
If you want to have grandchildren sleep over, host Thanksgiving dinner, and entertain friends and family, then you’ll want to look for a piece of property that can accommodate your needs.
Consideration #3: Resources & Discounts for Retirees
Some areas offer resources for senior citizens and retirees, such as community centers and volunteer opportunities. If staying active in your community and connecting with other retirees is a priority, you’ll want to check ahead of time to see what opportunities are available to you.
Additionally, you may find that the area you’re moving to offers added perks for seniors, such as discounts on public transportation.
Consideration #4: State and Local Taxes
If you’re considering staying in-state, checking into what your state and local taxes will look like may not be a top priority. But it is a good idea to check into taxes in the area you’re considering. In addition, you’ll want to look into other tax obligations, including sales, property, and estate taxes. Depending on where you move, taxes can vary greatly across the board.
If you’re struggling to determine whether or not you should move closer to a child or if your budget will allow for it, you’ll want to speak with your financial advisor. Together, you can determine the best decisions for living comfortably in retirement.
If living near your children is a big priority in retirement, weigh the pros and cons and talk to your loved ones to see what the best next step should be.
Erickson Braund is the Founder and Chief Financial Officer at Black Walnut Wealth Management. He is a Certified Financial Planner®️ professional and a Chartered Retirement Planning Counselor®️. Eric brings over 20 years of experience working with high net-worth individuals and families, helping them achieve their goals of protecting and growing their wealth for retirement and for generations to come. Because Eric is a CFP®️ professional, he adheres to high ethical standards and engages in at least 30 hours of approved continuing education in the financial industry each year.
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