Financial and legal considerations for relocation
By Mitch Adel, Managing Partner, Cooper Adel & Associates
AARP conducted a migration study several years ago that focused on relocation patterns among aging populations. The study attempted to answer questions about where and why people over the age of 60 are moving and what motivates these relocations. Surprisingly, one of the study’s clearest outcomes was the fact that only about 1 in 10 retirees actually relocates, a conclusion that contrasts with the stereotype of retirees moving for better weather or to be closer to their children.
But while there may not be as many seniors on the move as we assume, the group of “residentially mobile” retirees still consists of millions of Americans. It is a number that is likely to grow larger as the Boomers, with a different attitude about retiring, join the ranks of retirees. If you are one of the seniors looking to relocate, a critical issue to consider is the impact that the move will have on your finances and your financial future. Out-of-state moves can be particularly trying, presenting a number of potential complications for financial and estate planning.
Make sure you know the real price tag
The cost of moving can be significant, not to mention the cost to purchase a new home, which can vary dramatically not only from one state to the next, but also from one community to the next. While it’s fairly easy to determine what these costs will be and to plan for them, the cost of living is more difficult to calculate, and potentially a lot more significant in terms of its impact on your long-term retirement funding and overall financial planning. You should be aware of these differences and ensure your final decision is based on the real, on-going costs, not just a one-time savings or gain.
The medical implications
Making sure that medical care and retirement benefits are uninterrupted is another area of concern. When it comes to health insurance, you should consider that you may have a new primary doctor, specialists as well as dentists and even pharmacies. There can be hiccups when transitioning to a new doctor, pharmacy, etc. It is wise to budget time to find a new doctor that you are comfortable with—and to make sure that they accept your health insurance. Before the move, make sure you compile a detailed list of your current healthcare providers so that your records can be moved to your new team. Update your list of prescriptions, stocking up on important medicines as much as possible.
The legal implications
Another often-overlooked piece of the puzzle is the impact on your legal documents and your estate plan. If you are moving out of state, be sure to update your living will, healthcare powers of attorney and financial powers of attorney as these documents have provisions that often vary by state. It may not be necessary to change your trust when you move, but you should have it reviewed by your elder law attorney for any implications. Your elder law attorney can also connect you with elder law attorneys in your new state so that you can choose the professional who will best meet your needs and those of your family.
Even if you are just moving down the block, moving should be a time when you meet with your elder law attorney to review your plan. Moving closer to a relative who may be the logical choice to serve as your trustee or financial power of attorney may require some changes to your estate plan. If you are selling your home, there is paperwork to do and its a good time to think through the implications if you become ill. If you are moving in with your children and helping them with their mortgage, there are some important issues to plan for if you require long term care. The point is, you don’t have to—and probably should not—do this alone.
Making the right move
Because the financial and legal issues for seniors can be so significant, it is all too easy to overlook the most important factor of all: making the right move for you. Because nothing is more costly to a your health and finances than the stress and expense of an unhappy move, making sure to move to a senior-friendly location is Job 1. Seniors tend to gravitate to cities and towns with lower crime rates, access to top-notch medical care, a strong economy, quality amenities and services as well as a range of cultural, dining and entertainment options. While civic energy and dynamism are important to some, you may prefer a small town feel: a space where you can navigate and enjoy a range of lifestyle options without feeling overwhelmed. No one can or should try to tell you what the best choice is for your retirement.
The bottom line is this: moving can be a wonderful, even life-changing experience, but if you are thinking about moving, consider all of the financial and legal factors—as well as the personal factors—that should be addressed before relocating.
Mitch Adel is a certified elder law attorney and managing partner at Cooper, Adel and Associates, A Legal Professional Association. With offices in Centerburg, Chillicothe Monroe and Sidney, Ohio, Cooper, Adel & Associates has clients statewide and offers regular seminars to educate seniors on critical legal and financial issues. For more information, visit http://www.CooperAndAdel.com.
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