Category: Financial and taxes in retirement
March 21, 2025 — Finding a tax-friendly location to retire is very important for a significant percentage of retirees. High income individuals often find a state with no income or sales tax very attractive. But other taxes, like those on property or pension and Social Security, can be very important considerations, and should not be overlooked. LIkewise, if your retirement income is low, state income taxes will be a minor consideration.
Just because a state has no income tax doesn't mean that it might be the best one for your tax situation. Some states, for example, offer generous tax exemptions for military retirees or public servants, making them equally attractive. Others tax other kinds of income like pensions in very friendly ways. Some have generous deductions based on your age. Considerations like your desired lifestyle, where your family and friends live, or a climate where you can pursue your favorite activities, might be a lot more important to your retirement happiness than saving a few dollars on taxes. States like Texas tend to have high property taxes, which can neutralize its not having an income tax.
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Published on March 20, 2025
Comments 5
Category: Active adult communities
March 10, 2025 — The 2021 Surfside Towers collapse near Miami killed 98 people and injured many more. The Florida legislature’s response was swift and strict. Now, as those laws go into effect, backlash from the hardships they created is leading to efforts to soften the regs.
Already burdened by exploding insurance premiums, condo owners now also face huge assessments to catch up on their new reserve requirements. Added to those woes, newly required building inspections have discovered costly building repairs that need to be made. All of these combined factors have led to special assessments and/or significant dues increases. The result is a spate of homeowners who are unable to pay. Many have no choice but sell and and then find a new, more affordable place to spend the remainder of their retirement years.
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Published on March 9, 2025
Comments 4
Category: Best Retirement Towns and States
February 13, 2025 -- Good news is coming to 8 states this year when it comes to income taxes. It is part of a trend to lower taxes, make themselves more competitive, and enjoy the surpluses many of them experienced from the Covid years. Others, though, are concerned that the lower taxes will result in the cutting of public services. Seven of the 8 states that lowered their rates are controlled by Republicans.
Most of the reductions were relatively minor, usually less than a half a percentage point. Two of the states have moved to a flat tax instead of income brackets.
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Published on February 12, 2025
Comments 3
Category: Active adult communities
January 10, 2025 -- In a sign of what is to come from Florida's strict new condo laws, an entire condo building in Fort Lauderdale is for sale. The condo owners can’t afford the millions it will cost to repair it.
Damage from saltwater to the building's foundation is only part of the problem faced by the condo owners. Residents at Springbrook Gardens in Fort Lauderdale were forced to evacuate last September after an engineer warned of an unsafe foundation. The roof also needs expensive work, and there have already been many special assessments. According to one owner, the condo is spending $1 million in engineer studies and to get the building up to code. Foundation restoration work is estimated to cost over $4 million. There are only 18 units in the 70 year old building, so even though there might be some loan assistance, the cost per unit would work out to be about $222,000, a pretty large number.
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Published on January 8, 2025
Comments 4
Category: Financial and taxes in retirement
November 19, 2024 -- A number of people are in the fortunate position of having multiple accounts tohat could fund their retirements. They might have IRAs, 401(k)s, 403(b)s, Roths, and/or non-retirement savings and investments. But which one(s) should they tap first when they need money for retirement. Note: We are in no way an investment or financial experts, we are just laying out the issues and providinginformation for you to consider in your planning.
Complications affecting which account to withdraw from first
Before you even get to withdrawal strategies, there are other financial considerations that might apply to your decision. Among others, those include: when to apply for Social Security benefits, Roth conversions, and the state of your finances. In general we believe that in most cases it pays to wait until age 70 to start collecting Social Security, assuming you have enough to live on until then, and you and your spouse have an average life expectancy. But we could write a whole article on whether it is better to delay when you take Social Security by using your savings and investments, or let that money ride, and collect early.
Roth conversions, which allow you to tap retirement money tax free, are another complex subject, but often a worthwhile idea for people with big balances in their regular IRA and 401(k) accounts. These conversions need to thought through carefully, as you will pay taxes on any converted funds as they go in (but if you have low income or big losses you might be able to offset that).
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Published on November 18, 2024
Comments 4
Category: Financial and taxes in retirement
October 15, 2024 -- As if Florida condo owners didn't have enough to worry about. A deadly duo of hurricanes caused suffering and loss of human life. But Condo buildings 3 stories face other kinds of challenges, as December 31 deadlines for Florida's stringent new engineering inspections and reserve studies go into effect.
If condo and HOA boards aren't nervous about all this - they should be.
The original Building Safety Law (SB 4), and later clarified by SB 154, was a reaction to the tragic Surfside building collapse in Miami in 2021. It specifies 2 key requirements for condominium associations that will fundamentally those will affect their finances. The first is a Milestone Inspection Study, the second is the Structural Integrity Reserve Study. We will explain those in greater detail, later. But first, let's talk about how this will unfold in the real world.
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Published on October 14, 2024
Comments 6
Category: Financial and taxes in retirement
Sept. 1, 2024 --You could write a best seller on the ingenious ways criminals use to steal money from people, especially those over 60. These crooks capitalize on a sense of trust to drain senior retirement accounts with ploys like asking for help on stamping out corruption, or rescuing a relative or friend in trouble.
Folks 60 and over are often targeted by cybercriminals because they are such a rich source of funds. Among all age groups in 2023, people over 60 lost more than $3.4 billion from scams, according to the F.B.I.
Per the New York Times, retired attorney Barry Heitin lost almost all of his retirement savings, $740,000, to an incredibly complicated scheme. Criminals persuaded him that he was helping out with an important government investigation, so he spent months and many hours draining his accounts, where the money vanished into the black hole of the Internet. What's more, he owed the IRS taxes on his "withdrawals".
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Published on August 31, 2024
Comments 7
Category: Financial and taxes in retirement
August 6, 2024 -- The New York Times reported on a phenomenon that is literally uprooting retirees and others in Florida and elsewhere. In "Skyrocketing Insurance Is Clobbering Consumers" the Times reported on the crippling escalations in homeowner insurance that are forcing many homeowners out of their homes.
An unhappy situation!
When someone retires one of their most important moves is to calculate a retirement budget. To do that they balance how much money have they saved plus their income from all sources against expected expenses. Let's say that a retired couple figures they can swing a move to Florida or Arizona. Everything looks good when they retire. But after a few years one of their big budget items, home insurance, has doubled (FL insurance rates are up 40% in the last 5 years, higher in some areas). Instead of paying $3000 a year in premiums a few years ago, they might be on the hook for double what they originally budgeted for. Mortgages typically require flood and other types of homeowners insurance, so it is not optional. For anyone with a tight budget, the increases could be catastrophic.
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Published on August 5, 2024
Comments 13
Category: Financial and taxes in retirement
May 15, 2024 -- Many people are eager to quit their jobs and enter the ranks of retired. Spending their days golfing, relaxing, fishing, socializing, etc. But for more people than you think, retirement doesn't stick. Florida NPR has a great podcast that explains how and why some Florida retirees ended up re-entering the workplace, for a variety of reasons. It is definitely worth a 20 minute listen, particularly because it has interviews with real people explaining the circumstances why they went back to work, and the types of jobs they found.
Fastest growing group of workers in Florida - folks over 65!
It doesn't seem to make sense that so many workers in their 60's and 70's are going back to work. In fact it is not unusual to find people over 80 who are working. There are many reasons why. For one, the realities of the world can wreck even the best of dreams. Insurance costs have exploded in many areas of Florida, particularly on the coast. Home Owner Association fees are growing faster than the rate of inflation, usually because of insurance, but also because of higher than expected maintenance costs and other community expenses. Rents and ground leases go up steadily. Cars wear out and need repairs. The cost of everything is going up, particularly since Covid's disruptions started 4 years ago. The result is that many retirees are finding their income is not coming up to what it takes stay afloat. So in most cases, their only recourse is finding a job.
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Published on May 14, 2024
Comments 3
Category: Financial and taxes in retirement
April 20, 2024 -- The Dow Jones average is up over 10% in the past year, and the S & P 500 could hit its all time high of 40,000. If you have investments in the stock market that has probably been sweet music for you. But you might be wondering what will happen next - will the market continue to go up, sink like a stone, or just stay the same? Should you buy, sell, or just hold on to what you have? Here are some thoughts for retirees or those approaching retirement.
Safety is important. First, recognize that your investment decisions now have a different weight than they were when you were younger. You now have fewer years to recover, should something go wrong. So protecting your retirement funds should be your first priority. That means rash decisions - like selling everything or going all in - should be avoided at all costs.
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Published on April 19, 2024
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