Bloomberg News reports NJ retains its crown as tops for national property taxes. The 2011 average was just over $7,750, up 20% since 2009, and 66% since 2001, though slowed to a 2.4% gain over 2o1o by a Christie 2 percent cap that went into effect last year.
Inflation risk, along with market risk and regulatory risk, is one of the principal threats to your retirement income stream. A 66% percent jump in 10 years is double the rate of inflation most planners project today for the decades ahead. If you are a home owner, property tax will be a significant part of your retirement budget. It’s enough to make you want to leave home!
I’m adding a series of PDF booklets to the LFA website on Managing Retirement Decisions produced by the Society of Actuaries. The first is “Where to Live in Retirement,” which looks at the variety of issues you face planning housing during your non-working years.
Housing is central to retirement planning, since it anchors a myriad lifestyle and financial options and decisions. Aside from the local weather and cost-of-living, there are other inter-related considerations such as proximity to family and friends, health and access to healthcare, public transportation, options for recreation, hobbies, and continuing education, and opportunities for full or part-time work, starting a new small business, or volunteering.
If you are in reasonable health, you should consider that retirement housing is not necessarily a one-time choice. This period of your life could extend 30 years and encompass two or three different phases. In your early retirement, you may feel more adventurous, and look for experiences living abroad or in a place you’ve always wanted to live but couldn’t because of your work. As you grow older, you may find a more retirement-centered community offers conveniences and advantages as you slow down your pace. And after that, elder care issues may become foremost.
Take a look at the brochure, and the others I will be adding. Planning now will make some of the more difficult transitions to come that much easier.