Whether you’re facing imminent retirement or just daydreaming of the far-off day you can hand in your ID badge and office keys, one thing you won’t find a shortage of is advice: from what kind of insurance you’ll need to when to collect Social Security to the best place to retire.
So, where should you retire? Hey, how about Bulgaria?
The former Soviet Bloc country nestled in the Balkans features a low cost of living, good medical care, little crime, a favorable currency exchange rate with the dollar (they don’t use the euro, though they’re part of the European Union), and great transportation and infrastructure. The capital city, Sofia, is cosmopolitan, cultured, and cheap (how about a three-bedroom apartment in the city center for $500 or less a month?). The Black Sea boasts world-class beach resorts such as Varna and Burgas, and there’s fine skiing in the mountains near Sofia. (In other words: The summers are hot, the winters are cold and snowy.)
Convinced? Great, send us a postcard.
Oh, there are a couple of caveats. It would be a good idea to learn Bulgarian, since you won’t find English spoken much outside the cities. And though there’s easy direct deposit of Social Security, residency requires a bit more paperwork and bureaucracy than the average American may be accustomed to.
So you may be intrigued by Bulgaria as a golden-years destination, or you may have decided against it. Or (correct answer, ding-ding-ding!) you may want to do more research on your own, after making a list of what you really need from any retirement relocation.
Every year, there are articles guiding you to the best states or countries for retirees. Every year, the locations change. Kiplinger, using financial date, ranked South Dakota tops (Hawaii is second, so climate is clearly not a factor). Bankrate.com, in a study cited by CNBC and Fortune, used weighted factors from cost of living to taxes to climate to crime and also came up with South Dakota. Wallethub, relied on by AARP, uses a variety of criteria including affordability, quality of life, and health care, and came up with Florida as No. 1 (but it’s interesting to note that South Dakota was third). Forbes, using data from the National Institute on Retirement Security focused on taxes and wages, came up with Wyoming, followed by Alaska and North Dakota (don’t tell the folks in Pierre).
One factor that may explain South Dakota’s ubiquity on these lists: it’s one of seven states that don’t levy income taxes, along with other perennials Florida, Alaska, and Wyoming (plus Nevada, Texas, and Washington). In addition, a little more than one half the states do not tax Social Security; if you live in the other half, this may influence a decision to move.
When it comes to retiring abroad, International Living (also cited by Forbes) comes up with longtime favorite Costa Rica, based on the Central American nation’s political stability, health care, and affordability. CNBC, meanwhile, using data from U.S. News and World Report (focused on folks describing themselves as “upper class”), comes up with New Zealand.
Bulgaria makes none of the lists.
How did we pick Bulgaria? Well, our methodology starts with having friends there who have extolled its virtues (and warned of its drawbacks). The same goes for our first choice among the states we’d move to: California, where we have friends and family.
This is the factor we call the “spiritual” side of retirement decision-making. In making a move, consider where you’d be happiest. That view of the mountains or the beach from your window may be wonderful, but it may come at the cost of outing geographic distance from those you love and rely on.
Retirement and aging go hand-in-hand and advancing years can take a toll on both mental agility and physical prowess. Some find solace being near children, grandchildren, other family members, and friends. The toll on children taking care of elderly family members can be tremendous, and adding geographic barriers and time differences may be an added difficulty, even in an age of social media. If you expect to rely on an adult child to advise you through medical decisions or accompany you to important doctor visits, it adds an extra layer of difficulty when you live on opposite coasts.
This is something to consider whether you change locations or not. Can I handle the driveway, much less the stairs, or do I need a single-level house or apartment? Where can I expect to get the most help as I become less able to make decisions for myself?
Ultimately, the choice of your retirement location is personal and truly unique for each individual (or family). There is much more to the decision than the financial incentives some states of countries may offer. As with every aspect of retirement, consider what’s best for you, and be aware of the methods used by those who make recommendations. You may end up in Sofia or Sioux Falls. Or you may decide to simply stay put. As always, it’s best to discuss the decision with both your family and financial adviser.
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