I’m not sure this answers your question, but if you keep your federal insurance as a retiree, your benefits are exactly the same as they were before you retired (except for changes implemented each year, for both employees and retirees). You can also choose a new insurance company/plan each year, just as you could before retirement. The drug coverage, etc. will provide same benefits as pre-retirement.
Several people I know have chosen to skip part B., etc. and just keep their FEHB (fed emp health ben).
If you decide to do both Medicare part B and FEHB, check into the “lower” level plans. Some give you a rebate if you have Medicare. I know BCBS does, but not sure about GEHA.
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I think MA counts how many days you are in MA. Pre-Pandemic, I was out of the state more than I was in it. But, to move my tax home, I would also need to take steps to make the new residence real (voting as you point out, drivers license, car registration, doctors, churches/synagogues, favorite possessions). In my case the likely main index would be where my wife was.
From what I can tell, Puerto Rico counts days in the territory. I don’t know how they count days in which I’m out of town on business. I know that in Alberta, if you work for a Canadian company, any days spent out of the province on business working for an Alberta company count as a day in Alberta. I don’t know how Florida or Puerto Rico count them.
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As with anything there are so many variables to consider. I’m sure it’s a difficult decision with so many variables. Good Luck!
I’ve been told…this should be “creditable” a mistake I also made earlier on this thread.
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Sounds to me that moving to a no income tax state would save money in retirement.
There’s a reason athletes (golfers) live in certain states. For the tax advantages.
The issue is getting the spouse on board. They might be ok with some residence in a low/no income tax state for some of the year. Getting them to buy into it for half may be the biggest challenge.
As they say, you don’t have a tax problem, it’s a spouse problem. Not that I blame her. She may not care, she may not want to be away from friends and family for half of the year. Lots of personal issues overweight the financial situation. For her.
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I’m with @anxiousmom, 100%. I wish I paid more taxes because it would mean I have even higher income, and I’m grateful that the taxes I do pay do not impoverish me in any meaningful way. There’s enough left over to support our lifestyle. I don’t resent a single penny I pay into the public good.
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I moved in 2023 from NJ to MA. Doing my taxes now. Each state has asked me to proportion my income. I am going strictly by the day I moved - end of October. So 5/6 to NJ and 1/6 to MA.
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I used that same approach when helping my recent college grad file taxes as NYC resident vs non-resident. This was a couple of years ago so I am not 100% confident of my response, but I believe one of the TurboTax options was to count the days and then input.
So since I opted out - kept just BC/BS and have medicare A&B but not medicare part D- do you think they might charge IRMAA anyway?
Local and state might function well with the tax base, in high or lower tax states. A person’s quality of life may be impacted with higher taxes as their household may not believe they are getting enough benefit for the cost, and they look to ‘the grass is greener’ elsewhere.
For many households, the tax difference is not significant enough - while others will see the things they can do with that money. Some people jump into change with retirement in a big way.
In our area now, being in the best public school district is a big help with maintaining property value. With our homes in another state, the towns/city did not have that distinction, so we were a bit unprepared with our first home purchase in the larger city (our 3rd purchased home in 3rd city) prior to building our current home.
We have locally had to fight some ‘layering’ of municipal management where residents would absolutely lose not only ability to have local services be for the better of residents, but for lots of pocket lining “selling” our city to developers and having large bonds for projects that benefit individuals and developers/outsiders. Not contracting with local/area/state businesses but instead with their ‘network’ of municipal ‘insiders’ where someone surely is getting a cut of the action. Changing some of the ways the city is doing business, and pushing off costs with large bonds for projects - like a large $100 Million plus baseball stadium and now more development around that area.
We got the vote out with grass roots efforts on the big change in municipal government change. We have retained our form of government with a 3 to 1 voter margin. Slick advertising and outright lies, but fortunately we have a free weekly local paper that had both sides presented with opinion columns. Sign waving at specific areas with high traffic got people aware, with a short paper spelling out what the vote means.
With DDs home purchasing and any home purchasing that we will have in the future, we have a ‘head’s up’ on what to look for with good municipal and public school management - where we have choices in actual home location.
We will not be in our area super long term, but many families are here for generations. I have been involved with local municipal government for a while, but I have stepped back for other personal priorities. If major issues come up again, or when it is time for city council elections (2025), I will be out to help with getting good decision makers in there.
We don’t have the kind of income where state tax (especially in our CO 4.5% state) would make us consider relocation. And honestly I’d not want the stresses of maintaining two homes and the inflexibility imposed for residency reasons. The older we get, the more complicated it would get…. especially the medical angle.
Now would I consider a short term rental for a month or two in a warmer climate in the winter? Yes, that might be an option some year instead of the February warm-weather 1 week fancy vacations we’ve taken past few years. Definitely fits our priority of flexibility.
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I am not sure.
Did you mean you only have Part A?
I don’t see how they can charge you more - IRMAA is for B and D.
But I kept a federal HMO plan that requires Medicare recipients to be in the Medicare Advantage (Part C = Part A, B, and D) so my IRMAA applies to both B and D.
I opted for full Medicare and full federal. I don’t mind overpaying for insurance, glad that I can afford it. My plan reimburses me for Medicare premiums up to a point and my SS COLA this year more than covered the increase in premiums.
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Dh and I moved to Florida from a flyover state six years ago. We are now seriously considering moving back for a variety of reasons.
I am a Florida native and even though I moved away my senior year of high school, I had several childhood friends who had migrated from our hometown to the beach a couple of counties over. Since we have moved here, all but one set of friends has moved away for various reasons (caring for aging parents, new jobs, new marriage, etc). Besides having built-in friends, other aspects of Florida that made it appealing were no state income tax and the warmer weather.
At the time we moved, dh had retired from his corporate job. He was part of a non-qualified deferred compensation plan with his company, and his payments from that are pretty significant for the first ten years (less so for the last five after that, after which they cease). He unexpectedly got recruited for a job and went back to work full-time. While not making near the same level of income as he was, it’s not chump change either. The lack of a state income tax has definitely benefited us. Dh is now considering retiring again. While we do have four more years of deferred comp coming in, factors besides the tax angle exist. I miss my friends from the area where we lived most of our married lives and raised our son. This is dh’s home state and his mom just turned 85. She’s in good shape, but that won’t last forever. All of dh’s extended family is there. We wouldn’t be in the same town, but at least being in the same state, we would be much closer and able to easily get to his mom to assist.
When we first moved to Florida we were in a small condo we had bought as a second place on the intracoastal side before dh retired from the corporate job. We have since moved across the street to a larger place (still much smaller than our home was) on the beach side. That increased HOA costs (which, of course, is on us as we knew that when we made the move). Hurricane issues have increased costs further. However, a big pull in considering moving back is the increase in the value of the condo we are currently in. We really got in here in the nick of time right before prices started soaring. Since we have lived in this unit over two years, the idea of selling and being able to get a $500k tax-free gain is very appealing to us. Yes, prices have also increased back in the flyover state, but we could buy something for much less there than we would sell tthis for and pocket the difference.
In hindsight, we should have just held onto the original, smaller condo we had here in Florida. But, as others have said, I am not sure we are interested in owning two places. So, we are talking about what we should do.
@shawbridge - I am surprised you are considering a move to Florida again. My recollection was that you felt its citizens lacked intellectual vitality and you found the state to be generally lacking in meeting your cultural needs as well. I know nothing about Puerto Rico’s tax rules, but we know of friends of friends who sold their large home, acreage, horses, etc. and moved there this past year for the tax benefits. Again, you have the hurricane issues, and I would probably want to know about the quality of health care. No idea what hoops have to be jumped through in order to obtain the tax benefits there.
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Wow you did a lot to get where you are, but it seems you will get that nice win-fall with selling and having the 2nd retirement. With family there (when you move back), you can have some flexibility with timing on purchase to get the best property that fits what you want where you want it.
I was looking on line and with real estate local listings to see how our home stacks up. We definitely have a quality home in a particular niche - very desirable location, private back yard, etc.
DH just is fixing the garage hot/cold water spigot (he had to order a $49 part through Granger, and now has to order the $49 part for the hot side which was broken, and also one of the turn knobs needs replacing as well) - good to have a handy guy and avoid a repair call.
Our microwave just went out (DH already has taken it apart, the ‘Magnetron’ went out which is what makes it work - he said it melted, a small metal box device) - since it is in a built in upper cabinet spot, the width dimension had us get a Cuisinart Inverter the last time we purchased, but that new dimension on their current models has us getting the Cuisinart 100 instead (doesn’t have a few features but is fine) which will fit in the spot. Ordered on Amazon and will be here Feb 24th. Good. We use the microwave multiple times a day. This is only our 3rd microwave in 45 years.
DH has an achy lower back, and he has worn out his current Stressless Chair (the lower seat area has lost its fluff so we put a small pillow there, but not ‘optimal’) - well he was interested in replacing, and 10% off sale through March 5th at our local store. I waiting until DH was ready to act. We not only ordered the Admiral Medium Chair and Ottoman (to arrive in 4 - 6 weeks), but also go a clearance Stressless Love Seat, same leather color (two people can independently recline some - very comfortable). The love seat will go at the end of our bed for watching TV there, replacing the sectional piece that is currently there and uncomfortable for DH (and the old Stressless Chair and Ottoman will also go into the bedroom as well). I can envision DH using the Ottoman and switching back and forth on which ever he feels most comfortable. The family room new chair will get used every day by him. DH goes back and forth from BR/TV to his office, and when downstairs goes between the kitchen and his family room chair/TV.
We haven’t purchased furniture in years, and here we are with two furniture items. I thought the chair/ottoman would be closer to $3K and it was $2K. To me it was a ‘win’ with our perfect spot for the new clearance love seat.
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I think you put things really well.
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IRMAA for Part B, and D is based on your income. If you don’t have a part D, you won’t have a premium (or IRMAA) for that part. But your IRMAA for Part B will not change because you elected not to take Part D.
At least that is my understanding!
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Homeowner’s Insurance is getting very high in FL.
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This is true. Each portion, B and D have their own income related charts;
This is a good explanation:
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I think owning two places is something to think about, especially as we age. We just came back from 5 weeks in Florida, where we go to help ShawWife’s mother who at 92 is independent but not as independent as she thinks she is. Last winter, we were there for 6 weeks. She hires quite a few people regularly to take care of her place. If the tax savings were $30K or $50K or more a year, one could probably see one’s way to hiring help – maybe a property management company.
I can work there fine (although traveling to business meetings is harder as we are on the west coast and not Miami. I love the weather (compared to MA) and we bicycle every day at 4 pm. Easy to do. The bikes are just underneath the house and in one hour and 15 minutes, we are back in time to pull together dinner. ShawWife was having trouble working in her mother’s house but would have no trouble if we had our own place.
@Hoggirl, in general, it is still true that where we are on the west coast of Florida, the people on average don’t have the same intellectual depth or interest as they do in Boston (but that is true of most places in the world, I think, because of Boston’s concentration of great universities, biotech business, consulting firms, policy shops, etc.). Artistically, culturally and food-wise, Boston is OK but not great (NY, LA and SF are much stronger) but again, relative to Boston, the west coast of Florida seems weaker to me in all these dimensions. (Miami would be different). But, the stress-free warmth and easy exercise are attractive. Plus, we have some good friends from MA who now make Longboat Key their primary residence. They are exceedingly interesting – she is already on the board of one of the museums. And, they have interesting friends there. Longboat Key is very nice but would not work for us as we would need studio space for ShawWife. But Sarasota could work and ShawWife said a friend/mentor of hers just had a very good show at the museum there. And, there is a rowing center there (in Bradenton). If there are bike paths and rowing, I could be very happy.
But there are tradeoffs wherever we might choose to go for the winter: Low or no taxes, warm weather, and a sense of feeling freer in the winter on the one hand; language issues for ShawWife (most of the people we hire there are native Spanish speakers), likely lesser health care, less interesting people overall (but clearly this does not apply to every one), less interest artistically, culturally and food-wise. Life is about tradeoffs. I also would not mind voting in Florida if I could as voting in MA is unlikely to ever make a difference. Similarly, I have friends who say they want to retire in NY – easy transportation, doormen, great restaurants, theatre, art, opera, and very good health care. Would not be my choice but the tradeoffs work for them.
In any case, we would not give up our place in MA, though we might change its legal structure, and would likely be here for much of the time we are not in Florida (as much as we are anywhere – as I mentioned, I was in Brussels, London, LA and Las Vegas earlier this month and will go to DC and San Francisco next month, and likely London, Sao Paolo and several African countries over the course of the year).
As you point out, health care quality is an issue generally. The accounting firm we use specializes in helping entrepreneurs and our accountant told us that he has prepped a lot of people to move to Florida. He cautioned that toward the end of life, quite a few end up moving back to go to Mass General, Brigham and Women’s, Beth Israel or Dana Farber. In the process, their estates become subject to tax so some of the benefit is lost.
That would probably be a much bigger issue if Puerto Rico were the place of choice.
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Anyone who wants to pay more to the government is free to do so.
Citizens who wish to make a general donation to the U.S. government may send contributions to a specific account called “Gifts to the United States.”
This account was established in 1843 to accept gifts, such as bequests, from individuals wishing to express their patriotism to the United States. Money deposited into this account is for general use by the federal government and can be available for budget needs.
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