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Old 10-11-2008, 02:54 PM   #21
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I suppose there is the possibility that some State is just not spending money on things that are not important to you - that could reduce costs. I'm just having trouble imagining that a State would stand out in that regard. If there is one, it's probably one of those high humidity, termite infested places that I can't stand!
Don't bring up Texas or REW will tell you about the rattlesnakes again.
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Old 10-11-2008, 03:03 PM   #22
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Don't bring up Texas or REW will tell you about the rattlesnakes again.
In a strange coincidence, my nephew's wife was bitten on the toe by a rattlesnake a couple of weeks ago (seriously). She was was walking from the beach back to her hotel room - in Panama City, Florida. Spent three days in the hospital and required ten vials of antivenin. A very unpleasant vacation experience.
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Old 10-11-2008, 03:05 PM   #23
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Don't bring up Texas or REW will tell you about the rattlesnakes again.
Don't forget the scorpions and the chiggers.
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Old 10-11-2008, 03:11 PM   #24
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In a strange coincidence, my nephew's wife was bitten on the toe by a rattlesnake a couple of weeks ago (seriously). She was was walking from the beach back to her hotel room - in Panama City, Florida. Spent three days in the hospital and required ten vials of antivenin. A very unpleasant vacation experience.
I was hit by a rattler in New Mexico many years ago. I almost died of a heart attack. I managed to levitate myself up about 50 feet of rough cliff that I didn't remember climbing. I had two beautiful puctures near the top of my old boots that fortunately didn't go through. They were wet with venom.

Hopefully, she didn't have any serious, lingering effects. I've known people that have had large hunks of their flesh rot off around a bite. They can be pretty nasty.
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Old 10-11-2008, 03:17 PM   #25
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Hopefully, she didn't have any serious, lingering effects. I've known people that have had large hunks of their flesh rot off around a bite. They can be pretty nasty.
She may lose a toe or two, too soon to tell. Ugly wound.
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Old 10-11-2008, 03:36 PM   #26
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Almost anywhere would be cheaper tax-wise than California except for possibly New York, New Jersey and New England.
Thats why I said "early retiree".

My property taxes are fixed for life, with only small increases allowed, until I decide to move. We dont pay much in income taxes. I buy most big ticket items on the internet and like a weasel dont pay sales tax on it. Most of the rest of the stuff we buy isnt taxed with a sales tax.

So the actual tax bite isnt that bad. Many equally nice places to live whack the hell out of you on property taxes. Cant get away from those too easily.

Plus theres nice weather, low humidity, no serious bugs, no hurricanes, no earthquakes in my area, no tornadoes, low likelihood of drought in our area, and there are a half dozen places within a few hours drive that people from all over the world come to vacation at...so no need to pay big bucks to travel or take a vacation.

Yep...take a vacation...from being on permanent vacation...
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Old 10-11-2008, 04:26 PM   #27
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Spoken like a true Californian.

Almost anywhere would be cheaper tax-wise than California except for possibly New York, New Jersey and New England.
Ohio is the 5th highest tax burden in the USA.

NY exempts the first 20k retirement income per person from state tax (so I am told).

The OP need to give themselves some tax choices in retirement- if all money is tax deferred there are only a given number of options.

Add a Roth account in and options change
Add a taxable account in and options change
add muni bonds, dividend stocks and more to taxable account for even more options.
Add an annuity for even more options.

The choices should be able to lower the tax bracket.
Roth conversions should also be considered.
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Old 10-11-2008, 04:32 PM   #28
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Add a Roth account in and options change
Add a taxable account in and options change
add muni bonds, dividend stocks and more to taxable account for even more options.
Add an annuity for even more options.
At least you listed the annuity last. I don't see where they would beat laddered CDs IMHO but that's already been beaten to death.

I definitely agree with a diversification of assets to address taxable income. It's an important topic that I think many people neglect in the period leading up to retirement and afterwards.

I knew a guy so proud of himself that he paid zero income tax. I asked about why he didn't take out some from his IRA. He was very smug about not having to do that until 70 1/2. I could not convince him to use up his low tax brackets now with a Roth conversion.
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Old 10-11-2008, 05:11 PM   #29
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Lawman, let me elaborate on a point that's been mentioned in other posts.

If you retire early (before a pension has to pay out, before you take Social Security) then your earned income will plummet to... zero. At that point, while you're living off your dividends and perhaps selling equities, you can elect to roll over your tax-deferred investments to an IRA and then convert that IRA to a Roth IRA. You'll pay tax at the income tax-bracket rates, but starting from zero and with a standard deduction you can convert quite a bit every year and pay tax within the 10-15% brackets. After the conversion, Roth IRA withdrawals are not taxed.

Another option to lower RMDs would be to start a 72(t) withdrawal when you're younger than 59.5. But you'd be losing the advantage of tax-deferred compounding.

And finally, the longer you delay taking SS, the less taxes you'll pay on everything (including the SS distributions).

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My problem with that is that so far I havent seen a state with taxes that would be lower for an early retiree (income tax doesnt matter, low sales/property/investment) that wouldnt suck to live in.
*Ahem.* Remember those old Bloomberg articles ranking the nation's top tax-friendly states for retirees? Remember which state happened to be #1 a couple of years and has lowered its income-tax rates since then?

But maybe you'd prefer cheap real estate and Prop 13.
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Old 10-11-2008, 05:14 PM   #30
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*Ahem.* Remember those old Bloomberg articles ranking the nation's top tax-friendly states for retirees? Remember which state happened to be #1 a couple of years and has lowered its income-tax rates since then?

But maybe you'd prefer cheap real estate and Prop 13.
And forum members get free surfing lessons......
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