Welcome to Austin, Taxes

[Ol_Rancher]

"Hell, I may end up in Texas after all.

Jarhead"

Now, now Jarhead. Don't do anything hasty.

[REWahoo]

Originally Posted by Jarhead*

Hell, I may end up in Texas after all.

Jarhead, you're being redundant again.

Thanks for the advice about Arkansas, Youbet. *DH has also mentioned the Fayetteville area as an area to explore for retirement. *We will certainly explore Arkansas as an option. In addition, we like Taos (low property taxes and utilities and great outdoor recreation). NM has a significant state income tax, but our withdrawl rate to support our lifestyle would be less than half of what it would cost in Texas due to lower infrastructure costs.

As you mentioned, state income taxes can be minimized by lower withdrawl rates during retirement so the big issue for retirees is the ongoing costs like property taxes, insurance and infrastructure costs like utilities, etc. *Our goal is to keep these as low as possible.

[Ed_The_Gypsy]

What about the state of Washington?

No state income tax and reasonable property taxes (1% or so?) and health insurance that is available for most at fairly low cost. For those who live in Washington, is this true?

That depends on your situation. My wife has mild diabetes. Because of this, she would have to get individual health insurance from the pool, and that ain't cheap. The insurance companies will not cover her on an individual policy. We have been getting along on COBRA and now she is on a group policy where she works, so we are covered for a reasonable price.

I have heard that Starbucks makes reasonably-priced health insurance available even for part-timers. There must be a catch somewhere, but worth investigating.

[eridanus]

Originally Posted by BarbaraAnne

In Texas we have high property taxes (2.5% or more depending where you live),the highest homeowners insurance in the country (we pay about $2000/year and the average is about $1400) and outrageous utility bills. Sales tax is 8.25%.

The property taxes are high but I'm skeptical of the other claims. The Austin Energy kwh charge has always seemed reasonable when compared to other posters on this board. Or do you mean just because of the heat and AC?

3.55¢ per kWh, first 500 kWh

Is that high? I really don't know.

As far as people living in the 'burbs paying toll charges and $3 gallon gas -- wah, cry me a river. You choose to live in the idyllic suburbs, you pay the price.

[JPatrick]

Originally Posted by youbet

Sometimes you can find an area whose tax strategy is more beneficial for you personally and take advantage of that.* For example, if you like Texas Hill Country (I do!) you might also like northern Arkansas.* It's also hilly, scenic, not crowded, etc.* But, unlike Texas, their property taxes are very low, offset by eye watering high state income taxes.* Perhaps, in retirement, you'd like to own a beautiful home but won't have a lot of taxable income.* Arkansas would be a good switch for you.

Another possibility is to pop over the border to MO.* Same hills, water etc, but I think the overall cost of living is lower

[JPatrick]

Originally Posted by eridanus

The property taxes are high but I'm skeptical of the other claims. The Austin Energy kwh charge has always seemed reasonable when compared to other posters on this board. Or do you mean just because of the heat and AC?

3.55¢ per kWh, first 500 kWh

Is that high? I really don't know.

As far as people living in the 'burbs paying toll charges and $3 gallon gas -- wah, cry me a river. You choose to live in the idyllic suburbs, you pay the price.

Actually Barbara Annes property tax quote may be on the low side for Tx cities. Mine==3.37%.
Energy costs vary wildly from very high to reasonable.
Water, in some areas is going to be a major problem both in supply and paying for what there is.

[unclemick]

Hmmm

Quick look - we're 843$ on 85k house property taxes and I just did MO estimated - note that 6% rate starts at $9000 AGI - I'm single so $12500 exemptions and deductions - ouch!

Welcome to MO.

heh heh heh

My advice is to flee the city/suburbs as soon as you can. *When you've gone for a year without being in a single traffic jam, you'll wonder how you ever tolerated it. *

[eridanus]

Originally Posted by JPatrick

Actually Barbara Annes property tax quote may be on the low side for Tx cities. Mine==3.37%.
Energy costs vary wildly from very high to reasonable.
Water, in some areas is going to be a major problem both in supply and paying for what there is.

(Oops, mea culpa, BarbaraAnne. I thought you were writing specifically about Austin.)

Yeah, my parents have HL&P/Reliant/Centerpoint/whatever in Houston and their electric bill is outrageous. TXU (Dallas) is also very high. I'll toss out the crazy idea that Texas electricity deregulation didn't work too well.

Eridanus said:

3.55¢ per kWh, first 500 kWh

Is that high? I really don't know


I just checked the latest Reliant Energy bill and we are paying an average of 13.4 cents per Kwh.* This is less than TXUs 14.0 cents per Kwh.* The temperature is already in the 90's in the afternoon and its only April...Just wait for those July and August bills ...Yikes!

[Martha]

Originally Posted by Ed_The_Gypsy

That depends on your situation. My wife has mild diabetes. Because of this, she would have to get individual health insurance from the pool, and that ain't cheap. The insurance companies will not cover her on an individual policy. We have been getting along on COBRA and now she is on a group policy where she works, so we are covered for a reasonable price.

I have heard that Starbucks makes reasonably-priced health insurance available even for part-timers. There must be a catch somewhere, but worth investigating.

Ed, from what HaHa and the Georgetown University site say, if you stay in Washington, when your wife moves off her group plan to an individual plan there will be no underwriting. You should save a bunch of money.

[eridanus]

Originally Posted by BarbaraAnne

I just checked the latest Reliant Energy bill and we are paying an average of 13.4 cents per Kwh. This is less than TXUs 14.0 cents per Kwh. The temperature is already in the 90's in the afternoon and its only April...Just wait for those July and August bills ...Yikes!

Wow, 13.4 cents IS high!

It's supposed to reach 100 in Austin today. It's gonna be a long, rough, summer.

[youbet]

Originally Posted by TromboneAl

My advice is to flee the city/suburbs as soon as you can. *When you've gone for a year without being in a single traffic jam, you'll wonder how you ever tolerated it. *

Actually, I'd go nuts going without a traffic jam for a year! *But, I'd also go nuts not getting "upnort" for some wilderness canoeing and camping too. *

It's tough when what I'd really like is to be able to walk out the back door to my pristine lake with georgeous views and the smell of pine trees and walk out the front door to restaurants, clubs, live entertainment, hustle and bustle........

I extended my working life trying to be able to afford a place in the city and a place in the boonies and the gasoline to travel back and forth freely. *With escalating real estate prices, the ring just kept getting farther and farther out of reach. *So, for now, we're living in the city and visiting "upnort" frequently. *Waiting any longer to ER would mean it isn't ER anymore!

[Ed_The_Gypsy]

Hi, Martha,

Yes, we should be able to do that this time. The last time, our insurance company was way out of state and denied us conversion to an individual policy because we were not in their primary coverage area.

One of those things we should have been paying more attention to. I could have prevented the problem a few years ealier, but that is another story.

Ed

[astromeria]

Various state taxes, including favorable treatment of retirees and seniors, by state:

http://www.retirementliving.com/RLtaxes.html

[farmerEd]

Originally Posted by TromboneAl

My advice is to flee the city/suburbs as soon as you can. *When you've gone for a year without being in a single traffic jam, you'll wonder how you ever tolerated it. *

Good advice...I go for weeks not seeing a traffic light, never mind a traffic jam.

[Jarhead*]

Originally Posted by TromboneAl

My advice is to flee the city/suburbs as soon as you can. *When you've gone for a year without being in a single traffic jam, you'll wonder how you ever tolerated it. *

Trombone: We built our home in the Sierra Foothills, and our nearest neighbor is a mile away.

We're 15 miles away from the spot that I play golf. We're walking distance to a pretty good fly stream.

When we drive into town, we (on a busy day), may encounter 15 or 20 cars on the way down.

But the damn State, and the Federal Gov't hasn't lost our address.

[audreyh1]

Originally Posted by astromeria

Various state taxes, including favorable treatment of retirees and seniors, by state:

http://www.retirementliving.com/RLtaxes.html

I am always surprised that Texas ranks among the 10 worst on taxes because for me it's a very good state tax wise due to no state income tax. Most of our investments are in taxable accounts. A state income tax would put a serious dent in the compounding of our investments.

We don't currently pay property taxes because we don't own a home. But even when we did they were a small part of our total tax burden because we had a modest home.

So I guess it all depends on your level of taxable income and the value of your property.

Audrey

[2B]

Originally Posted by audreyh1

I am always surprised that Texas ranks among the 10 worst on taxes because for me it's a very good state tax wise due to no state income tax.* Most of our investments are in taxable accounts.* A state income tax would put a serious dent in the compounding of our investments.

We don't currently pay property taxes because we don't own a home.* But even when we did they were a small part of our total tax burden because we had a modest home.

So I guess it all depends on your level of taxable income and the value of your property.

Audrey

True. False. True.

We Texans enjoy not having an income tax but we more than make up for it with the property tax. My tax rate is about 3.8% of my property value. That would be equal to about a 9% income tax rate.

If you rent, you still pay property tax but it's your landlords. You pay rent that is if you don't live in a tent on a public right-of-way. I'm still working on the retirement scheme of either getting a small condo or apartment somewhere in the vicinity of the kids, et al and buying a "vacation home" somewhere we'd like to spend summers. Maintaining Texas residency would keep our income tax at zero but we'd be free to live where we would possibly pay a much lower property tax. I'd be happy moving around in rentals.