4 reasons to retire

Many elderly people retire at the same place they lived during their working years. And if the town or city you lived in throughout your career is filled with amenities, family members and friends, you may want to stay in your golden years. At the same time, moving into retirement can provide a more relaxed, stress-free lifestyle. Here are some reasons to consider making a move.

1. You live somewhere with high cost of living

Some cities are more expensive than others across the board. Often living in an expensive city gives you access to better jobs and a higher paycheck, but when you stop working, it is no longer a motivating factor. Therefore, if you live in a place where the overall cost of living is high, moving may allow you to better stretch your limited income.

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2. You live in a high-income or property tax area

High taxes can be a source of financial stress when you retire, even if you live somewhere that is not that expensive. Even if you do not want to collect a paycheck from a full-time job, you will still have income from social security, retirement savings (hopefully), or perhaps a part-time job or business. The less tax you pay for that income, the more money you will have left to spend.

The same applies to property taxes. Many seniors retire with mortgages already paid, but even if you own your house directly, high property taxes can be brutal when you have a fixed income. Therefore, moving a place where it is cheaper to own a home can help you better manage your limited income.

3. You live in a state that taxes Social Security

Most states don't tax social security benefits, but there are 13 that do:

1. Colorado
2. Connecticut
3. Kansas
4. Minnesota
5. Missouri
6. Montana
7. Nebraska
8. New Mexico
9. North Dakota
10. Rhode Island
11. Utah
12. Vermont
13. West Virginia

The good news is that most of these states also offer exceptions for low-income households to middle-income, so if your retirement income is not particularly high, you can avoid taxes on your social security benefits. The only ones who say that does not offer exemption at all are Minnesota, North Dakota, Vermont and West Virginia. Still, it's worth considering moving somewhere where you don't have to worry about government fees on your benefits.

That said, some of the above states may offer a lower cost of living for a whole, so do not allow social security taxes to be the only factor that informs your decision. Also, remember that even if you manage to avoid state-level social security taxes, you may be taxed on the benefits at the federal level, especially if they are not your only source of retirement income.

4. You live in a place where you absolutely need a car

Living in a walkable city, or one with public transport, can save you a significant amount during retirement by allowing you to get away without a car. It costs an average of $ 8,849 a year to own a vehicle, according to AAA.

Meanwhile, walking is free, and public transport can be relatively cheap compared to car rental, especially since many cities offer discounts to the elderly. Living a walkable place can also help keep you fit and thus save you money on health care.

Retiring is not an easy thing to do. It costs money to pack life and move, but making that investment can make your golden years easier from a financial perspective. And who knows? You may find that your new city offers more activities and social opportunities than you previously had access to.