Retiring on $100 a Day

senior citizens riding bikes together

Can you really retire in America and only spend $100 a day?  Turns out it’s a lot more possible than you might think.

When I started this recent study with AARP, I’d expected only about 20 or 30 U.S. cities would be this affordable.  But I was surprised to discover that most U.S. metro areas have a low enough combination of housing prices and property taxes to meet this criteria.

So what are the best cities for a $100/day retirement?

Based on things like arts and culture, rich community and great restaurants, here’s the Top 10:

City State Population
1 Spokane WA 471,221
2 Las Cruces NM 209,233
3 Eau Claire WI 161,151
4 Roanoke VA 308,707
5 Morgantown WV 129,709
6 Pittsburgh PA 2,356,285
7 San Antonio TX 2,142,508
8 Omaha-Council Bluffs NE-IA 865,350
9 Grand Junction CO 146,723
10 Gainesville FL 264,275

I’m assuming a 25% tax rate, which will reduce your yearly income of $36,500 to $27,375 spendable income.  That’s $2,281 per month.

The Bureau of Labor Statistics uses a percentage of 31.5% for the housing component of the Consumer Price Index.  That means that we have $719 per month for mortgage payments and property taxes.

I’m assuming a 20% down payment, which means that with current low interest rates, we can afford a house priced at $192,000.  Of course, putting up the nearly $40,000 (20% of $192,000) for the down payment may be challenging.

Continue reading “Retiring on $100 a Day”

A Cost of Growth

In the study of cities, getting bigger is usually seen as desirable if not inevitible.  So interesting issues are raised when growth starts to bring with it some questionable effects.

image: http://williamlitchfield.wordpress.com/

Austin, Texas has been a sanctuary for pickers, singers and painters for generations.  The problem is, the creative class is starting to get squeezed out.

People move to Austin because it’s so cool and hip, but the influx has pushed the cost of living UP and the artists OUT.

Now Austin is the priciest place to live in Texas.  The fancy $500,000 condos must be the target of the famous “Keep Austin Weird” slogan on the back of every VW van down there.

It’s a tricky chicken-and-egg situation when prosperity rides into town with unaffordability as its sidekick.  Austin is stepping up admirably, though – the city has spent $55 million on affordable housing in the past five years.

There’s an article all about it on the NPR site:

http://www.npr.org/blogs/therecord/2011/12/23/143725019/austin-the-brooklyn-of-the-south?ps=mh_frhdl1