Pros, cons of retiring near children
In my ongoing quest to figure out where I’ll eventually live in retirement, I recently came up with another brilliant idea: Philly. The main reason I’d rather be in Philadelphia? One of my daughters lives there, and my other two children live in Brooklyn, a quick train ride away. Being closer to my kids, not to mention the tiny package of perfection that is my granddaughter, would be a luxury.
The majority of retirees don’t have to move to get more face time with adult children because more than 50 percent of older households live within 10 miles of at least one child, according to the Health and Retirement Study, sponsored by the National Institute on Aging. But for those who live farther away, there are arguments for and against moving closer.
In the best-case scenario, you get to enjoy time with your adult child, forge bonds with the grandchildren and help the family out by occasionally babysitting. Plus, in this ideal version, your new city or town is in a climate you like, has lots of cultural amenities, a lower cost of living and myriad opportunities for making friends.
The worst-case scenario? You miss the friendships and networks you’ve established over the years, hate the weather and discover that the cost of living is eating away at your nest egg. The grandkids are too busy to spend time with you, or you’re expected to be a full-time babysitter. And even if none of that happens, your child and her family could decamp to another area.
To improve your odds of making the right choice, first identify your motivation for moving, says Lynn Dunston, a certified financial planner in Denver. For instance, if getting help from your son or daughter with errands or with personal care — now or later — is a factor, find out whether he or she is willing and able to take on that role.
Maybe one of your goals is to downsize your expenses. Be sure to vet the cost of living in your new area, as well as the tax environment for retirees. Even in a tax-friendly state, you might end up drawing down more than you had planned from your pretax account while triggering more taxes.
Once you’ve done the preliminary research, consider renting near your adult child for a few months.
“That gives you the flavor of the place without taking the financial risk of buying a house,” says Chris Hardy, a CFP in Suwanee, Ga. And you’ll see how everyone reacts to all that togetherness.