Personal Finance

Where is home when you retire?

Barbara McMahon
Barbara McMahon Random Photography

I was surprised when the young widow told me she had quit her job and planned to use all her savings to buy a manufactured home in rural Arkansas.

She was emotionally spent after her husband’s lengthy illness. Her kids, all adults now, wholeheartedly supported her. It was, for her, a well-considered, rational choice of where to live in retirement. And it illustrated to me how people will weigh different factors to reach the decision about where they want to live after they stop working.

I’ve seen more typical retirement housing decisions, of course.

There’s the option to scale down, where couples judiciously review everything accumulated during their lifetimes in an effort to reduce their possessions. They then move to a smaller, more manageable home, often in a maintained community to free them from burdensome home chores and create more leisure time.

I’ve seen the “scale up,” where retirees move to a larger home in hopes of longer visits from family, especially grandchildren. Often these homes are custom built with an eye toward “aging in place,” featuring such things as a single level, wider doors that can accommodate walkers or wheelchairs, and levers rather than knobs on doors and as faucets.

Then there are the couples that relocate in retirement. Sometimes it’s to be closer to family. Grandchildren are a big pull. Sometimes it’s a lifestyle decision, moving to a more favorable climate or a location that they’ve always loved to visit.

These can be tricky decisions. Many magazine and Internet articles create annual lists of the “best” places for retirees to live.

I encourage retirees to visit the location in all seasons so there are no surprises. One couple absolutely insisted they would retire in Florida because of its warm weather and favorable income tax structure. They reconsidered after a hurricane devastated the area they were considering.

“Why,” she asked, “would we want to live somewhere where a single storm can wipe out our most significant investment?”

They relocated to a lovely community on a lake in Texas, far from the coast.

Retirees can find themselves revisiting the “rent or own” discussions of their younger days. There are pros and cons for both.

Increasingly I’ve noticed retirees moving into apartments or managed communities. This relieves them of the burden of property upkeep and provides them with the ability to “lock and leave” their homes when the travel bug strikes.

Some choose these locations with an eye toward future care, anticipating that they may need available medical assistance in later years.

The snowbirds seek the best of all worlds. They continue to live in the neighborhood where they’ve set down roots and established friends. When winter weather approaches, they pack up and travel in their well-equipped RVs to another neighborhood in a milder climate.

Over time the RV park (some are quite luxurious) becomes a second neighborhood for them, allowing them to associate with a different set of familiar people.

Some RV groups arrange to meet each year in a different location.

Other snowbirds will lease an apartment, condo or vacation home elsewhere for a few months to escape the wrath of our winters.

So was I surprised when a friend recently announced she was investigating working as a volunteer and hoped to live, at no cost, in a National Park over the summer. With all the options available to her, the only surprise will be which volunteer opportunity she’ll choose.

Barbara McMahon is a Certified Financial Planning professional and member of the Financial Planning Association of Greater Kansas City. She is the president of Innovest Financial Partners in Kansas City. Securities and Advisory Services offered through an Investment Advisor Representative of Cetera Advisors LLC, Member FINRA/SIPC. Innovest Financial Partners, Inc. is independent of Cetera Advisors LLC, 601 E 63rd Street, Suite 220, Kansas City, MO 64110.