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3 Reasons to Consider Moving During Retirement


It might help help you achieve the retirement you’ve always wanted.

Katie Brockman

Retirement is an adventure, and it can be the perfect time to start fresh with a new beginning.

For some people, that may mean living out their golden years in a different city. Moving during retirement is a big decision that shouldn’t be taken lightly, and it’s not always the right decision for everyone. Some retirees may not be able to bear the thought of moving away from friends, family, and their community, and it can also be a big risk to leave everything behind and start new.

That said, there are also a few great reasons to consider moving once you retire. Not only can it be a fun adventure, but it can also help you save money and afford a more enjoyable retirement.

A wallet, airline tickets, and a cup of coffee with an airplane image etched into the foam sit atop a map of Europe.

Image source: Getty Images.

1. You can stretch your savings

If you’re currently living in a city with a higher than average cost of living, moving to a less expensive area can help you save loads of cash on everything from housing to transportation to healthcare and more.

This can be an especially smart move if your savings are less than stellar, because you’ll be able to afford a more comfortable lifestyle even without a robust retirement fund. And if you’re also willing to downsize to a smaller home in your new city, that can help you save even more.

Depending on where you choose to move, you may even be able to get by on Social Security benefits. Although relying on your monthly checks as your primary source of income in retirement isn’t typically recommended, if you’re nearing retirement age with little to nothing saved, you may have no choice. But if you move to a city that’s much more affordable than the one you currently call home, you just might be able to lower your general living expenses enough to survive on Social Security.

2. You could save money on taxes

Each state and city has slightly different regulations when it comes to taxes, but some are more tax-friendly than others.

For example, Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming don’t have a state income tax, which could potentially help you save thousands of dollars per year. This is particularly beneficial if most of your retirement income is coming from tax-deferred accounts such as 401(k)s or traditional IRAs, because with these types of accounts, you’ll typically be responsible for paying income tax on the money you withdraw in retirement.

You may also be able to save money on Social Security taxes, depending on where you live. There are 37 states that don’t tax Social Security benefits, and moving to one of these could result in more money in your pocket. Keep in mind that you’ll probably still need to pay federal taxes on a portion of your benefits, but avoiding the state tax will help you save some money.

Before you consider moving, however, make sure you’re looking at the big picture. For instance, if you move to a city where you can avoid paying taxes on your income and Social Security benefits but you’re paying sky-high property and sales taxes, that may not necessarily be the best decision. Or if you’re saving on taxes but the overall cost of living is much higher, you might not come out ahead financially. So before you make any big decisions, make sure you’ve done your homework and understand whether you’ll really be saving money by moving.

3. You might find more job opportunities

Many Americans want to continue working in their 60s, 70s, or beyond, but not everyone is able to do so. In fact, although 80% of workers say they expect to continue doing at least some work for pay during their retirement years, only 28% actually do so, according to a report from the Employee Benefit Research Institute. Part of the reason why it might be difficult to continue working at an older age is because in many cities, there may be fewer opportunities out there for retirees looking to pursue part-time work.

If you’re determined to continue working part-time in retirement — whether it’s to boost your income or simply satisfy a career change you’ve been craving for years — moving to a city that has more job opportunities could be a smart decision. Especially if you currently live in a smaller town with few job openings in your field, you might have more luck moving somewhere with more opportunities to continue working part-time after you retire from your full-time career. Just keep in mind that if you plan to move to a big city, you’ll probably see your general cost of living increase. So be sure to weigh the pros and cons of moving before you decide it’s the right choice for you.

Moving to a new city in retirement can be an exciting new adventure, but make sure it makes sense for your situation. If you’re up for a change of scenery and a new beginning — and you’ve done your homework to make sure it’s the right decision financially — it might be one of the best choices you’ll ever make.


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