Retirement Housing Decisions

For the vast majority of my life, where I lived was decided for me by one factor or another.

Initially, wherever my parents lived, I lived.

Then it was school. The colleges I went to (undergrad and grad) were in specific cities/areas I had to live in.

And finally, there was my career. Of course I could choose who to work for, but if I picked the employers I did, then I had to live where the job was.

In retirement, things are different.

Sure you might want to live in one place over another (for family, friends, weather, etc.), but you have much more freedom to choose where to live than you’ve probably had at any other point in your life.

And that’s what this post is about — the discussions my wife and I have been having about where we want to live in retirement.

Warning: I don’t have a lot of answers at this point. This isn’t a “How to Decide Where to Live in Retirement” post.

Instead, I’ll detail our background and thinking, then I’m counting on you to offer suggestions and advice. My hope is that others will learn from this process too so that they can decide their best retirement location.

How Did We Get Here?

Let’s rewind a bit for some backstory.

As you know, we could have retired many years earlier, when we lived in Michigan.

I loved Michigan despite the terrible weather. It was a great place to raise a family and we had many friends there.

But it’s not really what I would consider ideal retirement territory.

Instead I took a job in Oklahoma and when my “contract was exercised” (company lingo for “we are firing you but we’re paying you a lot of money to leave”) we could have retired there as well.

There was only one problem: we lived in Oklahoma.

My wife liked it there (it was a warm weather climate) but it was probably my least favorite place we’ve lived.

I loved the people, but the dirt was red (and everywhere), it was rather trashy (we used to joke that people simply threw trash out of their car windows knowing the wind would blow it into Arkansas), too hot for me (I can take heat if there’s a beach, but OK is pretty dry), and during the spring/summer months you had to fear for your life from the killer tornadoes.

If you live in Oklahoma and/or are from there and love it, I’m happy for you. I’m just saying it’s not my cup of tea.

So we decided to move on and took my last job in Colorado, arriving in Colorado Springs in the fall of 2015.

Oh, Colorado, where had you been all my life? Why didn’t I move here three decades ago?

It’s amazing here! So when my new boss turned out to be much more than I wanted to deal with, I decided to retire in my beautiful Colorado. It seemed like a no-brainer.

You would think that the story might end here — and it well may — but events have transpired recently that have us wondering whether we should stay or go.

Things to Consider

What events you might ask? Well, here are a few:

1. The winters.

I feel like a weenie even mentioning the winters. After all, we lived 14 years in Michigan. In about 10 of those years we had five plus months of cloudy, cold weather with 100+ inches of snow. So compared to that, Colorado is a breeze.

That said, if Michigan is a “1” on the winter scale and Grand Cayman is a “10”, Colorado Springs is a 5 or 6. Not bad, but not great either.

Now someone might be thinking about all the great winter activities Colorado has available.

Yes, you can drive to those if you like them, but we’re not big skiers. Plus it’s not like we live in Breckenridge, Aspen, or Vail. Ski places are hours away.

The first winter we had here was not good — lots of snow and my maniac boss made us drive in despite it being hazardous.

The next two were pretty mild, and if those would be normal, then I would rate Colorado Springs a 7 on the winter scale.

But they are not normal and this winter has been brutal — more like a 3. It’s been long, cold, and snowy and has us thinking this may not be our ideal winter climate.

2. Our daughter’s plans.

After our daughter graduated college, she moved back to Colorado Springs, which was awesome.

If she was staying here we probably would as well.

But she has a fiance, will be getting married soon, and will be leaving the area (he’s in the army). That means we have one less (major) tie to our city (our son would likely move with us as he’s always up for an adventure).

Now she could move and then come back. Or she could move and never come back. They plan to come back but those of us who have lived several decades know that life has a way of changing your plans.

3. The housing market is on fire.

The housing market in Colorado Springs has been on a steady march upward the past three years!

I don’t know what our house is worth now, but my guess would be $80k more than we paid for it (we paid $370k and now I’d estimate it being worth $450k after realtor’s fees).

Better yet, they are putting the finishing touches on a new hospital about five blocks from our house.

Do you know who needs nice, big houses and has plenty of money to over-pay for them? Doctors.

Realtor friends have said they think the hospital makes our area ready for a mini-boom on top of what the city has already seen.

So within the next year or so might be the time to cash in and call it a day on home ownership.

4. Loving Grand Cayman.

You’re probably tired of me talking about Grand Cayman, but we really do love it there, especially given the winter we had.

We should have stayed longer than 10 days this year, but that can be rectified easily. That said, I’m not sure there’s enough to do there if we wanted to stay a long time.

Plus it’s kinda pricey — both the places to stay as well as the food.

And it’s a bit far (though there is a new direct flight from Denver taking only 4.5 hours).

Anyway, if we could find a cheaper, closer place similar to Grand Cayman in the US, that would be pretty nice.

5. Plans by other family members and friends.

Turns out a lot of our family is thinking of converging on one particular state.

My wife’s oldest sister has one of her kids in Florida and she visits regularly.

My wife’s oldest brother is thinking of moving from California (where he has what I would call a below average house here that’s worth twice what my house is) to Florida to escape the out-of-control taxes there.

My wife’s youngest brother has retired from the army and is looking at leaving Pennsylvania winters in favor of Florida beaches.

My wife’s youngest sister spends a few weeks each winter in Florida escaping the cold. Her husband retires next April and they may be expanding the time there.

My parents are hitting the road in an RV this fall and plan to spend winters in Florida.

We have a lot of friends who live in Florida (all over the state).

Anyway, I think you get the idea. It seems like everyone we know is either moving to Florida, thinking about it, or at least spending a good part of the winter there.

We’re also pretty familiar with the state. I lived there in middle school (Orlando), visited often (my aunt lived in Key West and then St. Pete), and we’ve been there on vacation (Disney and a cruise departure.)

So the Sunshine State has popped up on our radar.

6. Downsizing.

Currently my wife, son, and I live in a home that could easily fit a family of 10.

Ok, maybe that’s a bit overboard, but when four of us lived here, a five bedroom, 4.5 bathroom, 3,800 square foot house was still pretty big. Even when we have company take over our basement for visits we still have plenty of room.

Now that there are three of us (and could be two at any time) do we really need (or even want) a place this big?

Probably not.

Housing Objectives

So where does this leave us?

Taking all the considerations above into account, we come up with these thoughts…

1. We would like to live in as little winter as possible.

The weather issue is a balance. We don’t want the toughest part of winter — which is basically January through March here. If we could avoid those months and be elsewhere when it’s cold here, that would be great.

That said, I dislike high heat as much as I dislike cold (probably even more). The one exception is where there’s a beach it feels less hot to me. Anyway, I don’t want to move year-around to a hot climate. We’ve lived in warm-weather climates (Nashville, Oklahoma City) and the summers are brutal.

Even as a kid I remember the Florida summers being too hot for me.

So any solution we come up with probably means we don’t live in the same spot year around.

2. We don’t want to abandon Colorado completely.

As noted in point #1, we love it here nine months out of 12. In fact, it’s close to perfect those months.

Plus who knows, maybe our daughter will stay and/or move back. And we have friends here, of course.

All this leads me to believe that I don’t see us coming up with a plan that has us leaving Colorado and never coming back.

3. At least some part of the year needs to involve a beach.

Whether it’s a trip to Grand Cayman, a Caribbean cruise, or a longer living arrangement, part of each year needs to involve a beach of some sort.

The beach speaks to me. It says, “Come, you love it here.” And I do. 😉

Specifically, I prefer clear water beaches like you find all over the Caribbean. A body of water that’s not that clear is just not as appealing to me.

4. If we want to downsize (which I think we do at some point), then selling in the next year or so is probably a great time to move on.

I can just see a nice cardiologist living here. She could pay us a fortune, then gut the whole place and put in high-end doctor stuff. 🙂

Her commute to work would be 10 minutes — if she WALKED.

On a bike it would take five. In a car, three.

It’s a win-win.

In addition, not having a house would make a semi-nomadic lifestyle much easier.

So What Are We Thinking?

Given all of the above, here’s what we’re toying with at the moment:

  1. Sell our home in Colorado Springs within the next year.
  2. Rent a place in Colorado Springs for April through December each year.
  3. Rent a place on the gulf-side of Florida for January through March each year.

Of course this is easier said than done. There are lots of considerations that go into something like this.

Our Considerations

Here are issues we need to confront if we plan on proceeding with the plan above:

1. There are pros and cons of selling the house.

We’d have to get rid of a bunch of belongings and it would be a hassle for a time (if you’ve ever lived in a home for sale, you know what I mean), but it would probably sell rather quickly.

The hardest part might be selecting who sells the house. We have about 50 friends who are real estate agents.

For a counter-point to this, we COULD rent the home for extra income. From looking at similar places it appears we could get $2,500 a month on the low end to $3,000 a month on the high end.

We could also AirBnB it and make a fortune in the summer and during Air Force Academy major events.

But do we want the hassle of that? If the house was in Michigan we’d simply roll it into our management company. But do we want to deal with an entirely new manager, more tenants, etc.?

2. Can we find places to rent for part of the year in Florida and Colorado?

I’m sure we could find a January through March rental in Florida, but could we find a 9-month rental in Colorado Springs?

And, of course, both places would need to be furnished.

One option could be to buy a duplex, rent out one side, live in the other, and have the tenant watch our place next door while we were gone.

3. Could we downsize enough to be mobile and live in two places?

Like most Americans, we are stuff collectors.

Even though we cleaned out when we left Michigan and again when we left Oklahoma, we still have lots of stuff. Can we get rid of it all?

Even more, can we live without it?

It’s an interesting question to ponder: what is the absolute minimum (or at least a reasonable minimum) of items a family needs?

4. Is mobile life good or bad?

We’ve never lived in two spots, so we don’t know what it’s like.

Do you lose community in both places or do your friend double in size?

Do you feel like nomads with no specific “home” or it home wherever you are?

Anyone have any advice on this? We’re completely in the dark on this topic.

5. What are the cost implications of such a plan?

While money isn’t really an issue (within reason), we also don’t want/need an extravagant lifestyle. It’s not our style plus spending more generally comes with its own set of problems that neither one of us wants to deal with.

And since I brought up the issue of money and this is a personal finance blog, let’s look at some numbers…

What are the Financial Implications?

Here are some general thoughts on costs related to all these issues:

1. Owning a huge house is expensive.

We don’t have a mortgage, but there are still taxes, insurance, utilities, and the wildcard of maintenance (which could be almost nothing or could be $4k when your heater goes out).

And the biggest cost is that we have a $450k asset that has appreciated nicely, but at some point likely won’t appreciate much more (and could go down).

If we could sell the place and invest it at 2.5% on the low end and 10% on the high end (I recently found a real estate investor who pays this) that means we’d earn between $11,250 to $45k annually from it.

These dollars would go a long way towards paying rent at some nice places.

2. Renting and moving back and forth is expensive.

Is it more expensive than owning a house?

I think it depends — on the house, the places you rent, how you move back and forth, etc.

I’d personally be ok with a mobile solution that would cost $20k more per year, so we could get what we wanted.

3. Taxes are better in Florida.

Haha! You knew I was going to bring this up, right?

I’m wondering if we can/should live longer each year in Florida to establish it as our state of residency.

No state income taxes is very nice. 😉

Then again, our Colorado taxes this year were $2,440 so it’s not like we’d save a fortune.

Next Steps

Now that everything is on the table, here’s what we’re doing as of now (this is highly subject to change):

1. We’ve narrowed the focus of where to look in Florida.

Initially we started with the entire state, but have decided the gulf-side beach towns are best for us. The water is clear (like the Caribbean) and beaches are beautiful, or so I’m told.

In particular, we’re going to concentrate from Tampa/St. Pete/Clearwater to anyplace south. Those are the places that have 70 degree temps even in January.

2. We’re doing remote research.

This involves a couple of things.

First, we’re looking online at data (like temps), housing costs, reviews, etc.

Second, we are talking to as many people as we can who either live in our target areas or visit them.

If you fit this criteria, I’d love to hear your thoughts.

3. We are planning a scouting trip(s).

We were initially headed to Destin, Florida in October since we’ve heard so many great things about it, but it turns out Destin in January isn’t as warm as my wife would like. So if we don’t want to stay there as part of our long-term plans, why would we want to scout it out as a potential location?

As such, we’ve altered plans and are likely headed to Siesta Key, Florida in October/early November (still working out the details).

In addition to enjoying the life there, we’ll do a bit of exploring (both north and south) to see what we like and dislike. 

Then this coming winter we’ll head back down again for a month-long tour of the places we liked. We’ll probably fly to Tampa, rent a car, and head south.

That’s a long way away at this point, so it’s highly subject to change.

4. I need to begin the “what do we do in Colorado?” process.

This means taking steps on selling the house and finding places here to rent.

To be truthful I dread the thought of it (real estate agents here are like sharks in a pool of blood), but it has to be done.

5. I’m posting this so you can help.

I’m sure many of you can offer ideas on our line of thinking, the pros and cons of various places in Florida, or a host of other things we haven’t thought of or have wrong.

So let me have your comments below — I’m looking forward to hearing them.


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