Taxes are one of the main expenditures during retirement. Family, career and other factors are less as important and pressing as earlier in life, and a move may be beneficial to your wallet. Changing zip codes could save you thousands of dollars in tax dollars. Each state has a different tax scheme, and the amount you pay can widely vary by state. Several states offer no sales tax in addition to low property taxes, while states like California, Hawaii and New York are significantly higher than the lower states.
- Many states have low taxes across the board like income, sales, and property with estate as no exception. These states will allow the retiree to keep most of their money.
- States the have a higher tax burden often have exemptions and deductions for certain retiree classes as well as pension income.
- One should consider there portfolio of income, investment, and savings when they approach selecting a state for minimal tax burden.
“But as you consider the cost of living in potential retirement destinations, don’t overlook the impact of state taxes on your bottom line.”