Can you really retire in America and only spend $100 a day? Â Turns out it’s a lot more possible than you might think.
When I startedÂ this recent study with AARP, I’d expected only about 20 or 30 U.S. cities would be this affordable. Â 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:
I’m assuming a 25% tax rate, which will reduce your yearly income of $36,500 to $27,375 spendable income. Â 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. Â 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. Â Of course, putting up the nearly $40,000 (20% of $192,000) for the down payment may be challenging.
The description of the video interview with the reporter (Arden Dale) states â€œWhen states raise taxes millionaires move out.â€Â And the interviewer starts the piece by declaring, â€œMillionaires are fleeing from taxes!â€
Wow, that sounds serious, and certainly very definitive.Â Letâ€™s learn more.
Interviewer â€“ â€œSo tell us, where are the millionaires going?â€
Ms. Dale â€“ â€œPeople donâ€™t want to be taxedâ€¦ but when we looked the actual numbers, the actual studies of whether â€˜Millionaire Flightâ€™ occurs, what we found was that there is no really great statistical data that shows that it does.â€ (Note: while this is being said, a banner on the screen reads â€œMillionaires moving to avoid taxes.â€)
In the study of cities,Â getting biggerÂ is usually seen as desirable if not inevitible.Â So interesting issues are raised whenÂ growth starts to bring with it some questionable effects.
Austin, TexasÂ has been a sanctuary for pickers, singers and painters for generations.Â The problem is, the creative class is startingÂ to get squeezed out.
People move to Austin because it’s so cool and hip, but the influx has pushed theÂ costÂ of livingÂ UP and the artists OUT.
Now Austin is the priciest place to live in Texas.Â 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 withÂ unaffordabilityÂ as its sidekick.Â Austin is stepping up admirably, though – the city has spent $55 million on affordable housing in the past five years.
MyÂ work is all about data and what it can tell us.Â So I know that numbers aren’t always what they seem, and they are often misleading either as an accident or part of aÂ larger agenda.
The National Association of Realtors (NAR) announced today that it will be restating home-sales data going back to 2007.Â (Hey, isn’t that when the housing market started to tank?Â That’s a coincidence.)
“The Chicago-based organization has known for a long time that the existing homeÂ sales data it releases to the public each month were significantly inflated. ItÂ knew that it was double-counting, miscounting and relying on outdated censusÂ results that pumped up its report on housing activity.” Chicago Tribune, 12/21/11
I just completed a really in-depth study on the best metro areas for seniors to live in.Â Minneapolis came in first, with Boston and Pittsburgh rounding out the top three.Â There’s an overview of the study here, with the top 25 cities:
WeÂ considered nine broad categories, each consisting of several specific measures:Â Healthcare, Economy, HealthÂ & Longevity, Social Life, Environment, Spiritual Life, Housing, Transportation, and Crime.
Here you can download a PDF of the entire study, with all 50 cities ranked, as well asÂ full methodology and detailed city writeups:
In the PDF, we’ve even broken how citiesÂ scoredÂ in each of theÂ individualÂ categories.Â For example, the #1 city for Environment was San Francisco, whereas the #1 city for Housing was Oklahoma City.