Maybe you have a good base of friends where you live now, but your children have moved away. As they continue to grow families of their own, a thought may cross your mind. Should we move closer to our children (and grandchildren)? If so, what are some financial considerations to keep in mind?
Consideration #1: Cost of Living
Do a cost-comparison between where you live now and the province, territory or city in which you’re considering moving to. What are real estate prices like? You’ll want to determine how monthly expenses like insurance and groceries will vary as well.
Check out local restaurants, public transportation costs and any other common expenses that will impact your budget.
Consideration #2: Housing
One of the biggest considerations you’ll need to make is what your living situation will look like. Will your child move you into an in-law suite? Or do you need to weigh the pros and cons of renting versus buying a home? When you’re looking for housing, you’ll also want to consider functionality. Will you be hosting celebrations and holiday dinners in your home, or do you primarily plan on spending time over at your child’s place? If so, then you may find it best to downsize to a condo or apartment.
If you want to be able to have grandchildren sleepover, host dinners and entertain friends and family, you’ll want to look for a piece of property that can accommodate your needs.
Consideration #3: Resources & Discounts for Retirees
Some areas offer resources for senior citizens and retirees, such as community centers, programs and volunteer opportunities. If staying active in your community and connecting with other retirees is a priority, you’ll want to check ahead of time to see what opportunities are available to you.
Additionally, you may find that the area you’re moving to offers added perks for seniors, such as discounts on public transportation.
Consideration #4: Province and Territorial Taxes
If you’re considering staying in your province, checking into what your province and territorial taxes will look like may not be a top priority. But wherever you’re considering heading to, check into what you can expect your taxes to look like. In addition, you’ll want to look into other tax obligations including sales, property and estate taxes. Depending on where you move to, taxes can vary greatly across the board.
If you’re struggling to determine whether or not you should move closer to a child, or if your budget will allow for it, you’ll want to speak with your financial planner. Together, you can determine the best decisions for living comfortably in retirement. And if living near your children is a big priority in retirement, weigh the pros and cons and talk to your loved ones to see what the best next step should be.
Beacon Hill Private Wealth is an independent, fee-only, fiduciary investment advisor providing evidence-based wealth planning solutions that simplify our clients' financial lives. Founder Tom Geoghegan, CFP® CPWA® RMA® MBA is also a member of the National Association of Personal Financial Advisors (NAPFA).
Why work with a credentialed advisor? The Certified Private Wealth Advisor® (CPWA) certification, administered by the Investments & Wealth Institute®, is the standard for competence in the field of wealth management today. The advanced credential created specifically for wealth managers working with high-net-worth clients is focused on the life cycle of wealth—accumulation, preservation, and distribution. CPWA certified professionals are able to identify and analyze the unique challenges high-net-worth individuals face and understand how to develop specific strategies to minimize taxes, monetize and protect assets, maximize growth, and transfer wealth. The CPWA designation signifies that an individual has met initial and on-going experience, ethical, education, and examination requirements for the professional designation, which is centered on private wealth management topics and strategies. Fewer than 1% of financial advisors have achieved the CPWA certification.3
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