With its year-round sunshine, stunning beaches, and relatively cheap taxes, Florida has long been a popular choice for retirees. However, an increasing number of Americans are opting to spend their golden years in its neighbor to the northwest.
According to the Wall Street Journal, last year, John Fox and Louise Turkula of Minnesota purchased a 3,000-square-foot coastal home in Baldwin County, Alabama, for $955,000. The couple kept the four-bedroom property, complete with a swimming pool and pool house, as their retirement escape for the winter months.
They initially looked at homes in Jacksonville and Naples in Florida, where they had friends, but ultimately decided to settle one state over on Ono Island along the Gulf of Mexico. Their real estate agent, Lawanna Sharpless, told the Journal it was more affordable.
Baldwin Offers Huge Savings
Baldwin County outpaced all other Alabama counties in population growth from 2010 to 2020, expanding by roughly 27%.
Florida Atlantic University in Boca Raton economist Ken H. Johnson says that growth can be credited to older Americans being priced out of Florida. There’s no sacrificing climate for cost, either. Residents get the best of both worlds.
Baldwin County boasts an average home value of just above $374,000 while having one of the nation’s most affordable median property tax rates. Plus, homeowners who are 65 or older are exempt from paying state property taxes altogether.
Another retired couple, Kathy and Ashley Gordon, could add to their nest egg by making the move. According to the Journal, they relocated to a three-bedroom, cottage-style home in a golf course community in Fairhope of Baldwin County for $543,000, selling their previous home in Florida for $875,000.
Three Ways to Afford a Comfortable Retirement
While moving to a less-expensive spot can be a great way to enjoy your golden years without breaking the bank, there are other ways you can afford a comfortable retirement, too. Here are three tips to help you get started.
Start Saving Early
If you still need to begin saving for retirement, now’s the time to make some headway in a tax-advantaged account. Maximize contributions to your IRA or 401(k) as much as possible. If you’re saving alone, consider automating your monthly transfers to keep you on track. And remember, once you turn 50, you can start making annual catch-up contributions.
Generate Passive Income
Instead of delaying your retirement and working longer, try to find ways to make some easy cash on the side of your regular 9-to-5. Rent out your garage or an unused parking space, or become an Airbnb host by renting a spare room. Consider growing your money in a high-yield savings account or a certificate of deposit, which could get you better returns than a traditional savings account.
Make Smart Investments
You could benefit from a well-balanced, diversified portfolio despite the stock market fluctuations. If you’re new to investing, consider beginning with an adviser that will automatically rebalance your portfolio as the market fluctuates. And if you cannot put hundreds of dollars toward your stock picks, some services will let you start small with your spare change and work your way up once you get more comfortable.