This week, while playing in my (beginner) golf league, I was pondering the green grass while learning how to play “best ball”. That led me to start wondering about how much water is used to keep things so green, what sorts of chemicals was I standing in and how on earth do they justify these courses in other, drier parts of the country? Then I channeled my late husband and hit a shot straight down the fairway and suddenly I was less concerned about all those environmental things…perspective is a wonderful thing.
So, let’s talk about those other parts of the country. At least once a month (and sometimes more often) I have someone comment to me that they are going to head West or South (not so much East) and get out of New York. Putting it right there on the table…yes, we pay some pretty decent size taxes here in the great state of New York. I’m not going to deny it. In fact, I’m going to embrace it. That being said, there is so much more to a cash flow plan than taxes—I can already hear some of you definitely drawing blood as you squeeze your fingers into fists of outrage but stick with me on this one. Let’s look at some other big-ticket cash flow items.
Health insurance: I let my fingers do the walking this week and did a little shopping for health insurance in three fairly popular transplant destinations. In North Carolina, the exact same plan as the one I carry is 60% more expensive. In Florida, the difference was 24% more (with a $2k higher deductible) and in Boise, while I’d be paying slightly less, I could be denied coverage (something not allowed in New York). I had a hard time believing that Boise, Idaho, was on a “Best Places to Retire” list so you can imagine my surprise when I found it on several. Another aspect to this research is access to medical facilities. Comparable costs won’t do you any good if you have to drive more than an hour for a simple check-up or none of the local doctors are taking new patients.
Utility / water rates: As I think I’ve mentioned before, when my parents moved from Penfield to Avon, my mother nearly had a heart attack when they received their first water bill since, apparently, Avon pipes their water through gold pipes by way of Mars (there’s a whole story behind our water rates but we’re talking finances here, not politics). Thinking of heading West or South? Water rates for basic residential usage in Jacksonville, FL, average $43/month and can run more than three times that in some of areas further West.
Vehicle incidentals: Let’s assume you are taking your car with you. If I were moving to Iowa, I could be paying more than $195 to re-register my car (versus the $55 check I just mailed). Heading south to Maryland, that’s going to be $135. Filling the tank on the way to the DMV, you’ll be paying ~$2.88/gallon for gas in Iowa and $3/gallon in Maryland. Sure, your car insurance in Boise is about half of what you are paying in New York but what they don’t tell you is that your coverage is less robust than what you enjoyed in New York because our mandatory minimums are higher than other states.
Stepping lightly on a third rail, climate change: The changes we’re seeing in the environment can have knock-on impacts on your costs of living. For example, it’s getting harder and harder to secure cost-effective homeowner’s insurance along parts of the coast and in fire-prone areas. In some of these areas, it isn’t a matter of the insurance costing more, it’s a matter of not even being able to secure coverage. Does your financial planning accommodate paying to rebuild your house?
Finally, and perhaps most importantly, travel: If you are moving to state A and your loved ones are in state B, make sure you budget for travel back and forth to see them. It doesn’t do you any good to eliminate the NYS state and property taxes and end up spending more on Delta to visit those budget-busting grandbabies.
Of course, there are lots of reasons to move and I don’t want to discourage anyone who is thinking of moving from doing so. What I would encourage people to consider is that moving isn’t really a fiscal thing—it’s a deeply emotional one. Long before you put the numbers together, make sure you think through the “why” of your move. If you are pretty sure of your “why” the next step will be to build a Cash Flow Worksheet (remember those) as if you already lived there. Despite some pretty glaring faults, the internet is very useful when it comes to finding out how much something costs in other places. As with so much that has to do with our finances – it’s not about making the right or wrong choice, it’s about making an educated choice.