Transition Thursday: Less Means More for Baby Boomers Who Downsize in Retirement

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According to writer Jeff Reeves, “A comfortable retirement is not just the money you have, but also the expenses you’re tallying up, too.” In the article “Less means more for Baby Boomers who downsize in retirement,” Reeves shares advice from experts who suggest that the cost of downsizing can add up.

“A variety of items can add up to a pretty big difference in the monthly budget of Boomers who are willing to downsize. Those items can include:

Taxes. ‘It’s really dramatic, where you have Florida on one extreme that has no income tax, to states like New York or New Jersey or Connecticut that have very high income taxes,’ said Chris Blunt, president of the investments group at insurance giant New York Life. ‘A 7% swing in income tax, if you’re on a tight budget that matters.’ Property taxes can also vary widely even within a few hours’ drive from your current home, and could result in hundreds or even thousands of dollars saved per year.

Access to public transit. Being able to downsize from two vehicles in your household to one – or even none – can save you on car payments, insurance and maintenance. However, a move like that requires Baby Boomers to downsize to an area that can keep them mobile even without a vehicle of their own.

Health care. Many factors influence health care costs, including location and access to good doctors and specialists who are responsive and within your coverage network. ‘There are parts of the country with more cost-effective health care systems than others,’ Blunt said. For instance, a 2015 study by HealthView Services estimated supplemental medical insurance can vary widely – with a 65-year-old in Maryland paying 72% more than one in Hawaii.

Electricity and overhead. ‘With moving to a smaller home, you would expect to see lower utilities and you might see a difference in maintenance costs,’ said Lori Trawinski, director of banking and finance with AARP’s Public Policy Institute. And generally speaking, a smaller and less valuable home will also carry smaller insurance costs than a larger home in a similar area, she said.

Read additional tips at Less means more for Baby Boomers who downsize in retirement.


DAYNA WILSON: As a Certified Senior Housing Professional (CSHP) , I have special knowledge about everything from reverse mortgages to the importance of universal design. I can tap into my network and put you in touch with my team of qualified home inspectors, movers, attorneys, CPAs, organizers and other experts. I have all the resources and knowledge to simplify the transaction and eliminate the anxiety of selling your home.

Call me today to talk about your real estate concerns. I’m here to listen: 925.788.6582