Where Did You Retire?

     We read so many articles about the best places to retire. The lists are typically based on statistics about climate, income, life expectancy, access to health care. But all these are theoreticals. I wonder what people really care about when they decide where they're going to live after they retire.

     I remember my parents disagreed about where they were going to retire. My mom wanted to move to warm, sandy Florida. My dad wanted cool, blustery Cape Cod. They solved the problem by selling their suburban home and buying a place in Florida along with a summer cottage in Cape Cod. They spent eight months in Florida and four months in Cape Cod. When they got into their 80s and couldn't handle two places, they finally settled in Florida.

     We had neighbors back then who didn't know where they wanted to retire. So they sold their house, rented an RV and spent a year traveling all around the country, searching for their retirement haven. They ended up in Greenville, SC. Why? I don't know. But for them it was the place to be.

     We have friends from New York who retired to Charleston, SC. They told us they had always expected to move to Florida, "because that's where New Yorkers go when they retire." They took several trips to Florida looking for a retirement location, but never settled on anything. On the last trip, they stopped in Charleston on the way home to see an old friend. "We fell in love with the city immediately," they told me. Two days later they agreed to buy a townhouse outside of Charleston. And now, five years later, they are happily living in the townhouse . . . and one of their children has now moved to Charleston as well. 

     I have two sisters. One moved to Florida in her 30s. And she's still there. The other moved all over the country and beyond. Her last job was in Phoenix, and after she retired that's where she stayed. I don't know if she really feels like Phoenix is home; but she has a grandchild there now so that's where she's gonna be.

     So what's your story? Where did you move when you retired? And what led you to go there? Or, if you never moved at all, why not?

     My wife and I moved from New York to Pennsylvania. We were both born and raised in the Northeast and realized we would never be comfortable living anywhere else. Florida? The Carolinas? The West Coast? Great places to visit. But not to live. At least for us.

    But we wanted someplace a little less expensive than our pricey New York suburb. We considered Cape Cod. Too cold and dreary for nine months of the year. We visited Annapolis, MD. It's pretty expensive there, and seemed kind of cliquey. We looked at half a dozen places in New Jersey, including Cape May. But then we found out it's a lot less expensive if you just move across the state line into Pennsylvania. 

     So that's what we did. To be honest, we might have moved to be near our children. But we have four children between us, and they are spread out all over the country. So that wasn't in the cards. B does have some family in Pennsylvania and nearby New Jersey. That was a draw. And now, occasionally, my son is able to drive an hour west from Brooklyn, and I can drive an hour east from Pennsylvania, and we'll meet up in New Jersey for a round of golf. 

     That's our real-life retirement story. What's yours?

Sobering Stopover

     We didn't make as many stops as usual on the way home from Charleston, SC, and they were quicker too, so we were a little ahead of schedule. As we traveled up I 295 around Richmond, I saw the Cold Harbor Civil War battle site was just off the highway. I suggested to B: Maybe we could stop for an hour.

     I don't know why -- I had no ancestors who were in the Civil War -- but I find Civil War history fascinating. Not just interesting in a general sort of way, but fascinating in the original sense of the word that suggests arousing interest through terror, like the way we are fascinated by the sight of a snake.

     I've taken an online course about the Civil War, and a Civil War class at our local Center for Learning in Retirement. I am not a scholar, but I've read several books on the period (although I was too intimidated to read the thousand-page-plus Grant by Ron Chernow -- which is why I'm no scholar.)

     Anyway, few years ago I visited the Petersburg, VA, battlefield site, with my daughter. We saw remnants of the Confederate defenses against the Union siege of 1864, along with the underground tunnel used by Federal forces to blow a hole in Confederate lines -- a move that backfired when Union forces got trapped in the crater left by the explosion.

     Last year B and I spent a day at Gettysburg. We got a tour of the battlefield, and heard about Little Roundtop and Big Roundtop, and looked out over the field where Picket's men charged the Union lines, costing the Confederates over 2000 casualties in less than an hour.

The Cold Harbor Killing Field today

     The fighting at Cold Harbor was part of Grant's Overland Campaign of 1864, as he pushed back the rebels in the Battle of the Wilderness, at Spotsylvania and Cold Harbor, on the way to Petersburg and then Richmond.

   B and I arrived at the site and walked the one-mile loop around the battlefield, surveying the remnants of trenches, rifle pits, and an open area called the Killing Field where on June 3, 1864 advancing Federal troops were cut down by entrenched Confederate soldiers. From May 31 to June 12, nearly 18,000 men were killed, wounded or captured.

     Of course, as we all know, a year later, on April 9, 1865, Robert E. Lee surrendered the Confederates to General Grant, at Appomattox Courthouse, marking the end of the Civil War. The Union was saved. And some 4 million slaves won an uncertain freedom.

     The cost was an estimated 620,000 people killed in the military, with almost a million more wounded, captured or missing. And who knows how many civilians lost their lives or livelihoods because of the war, or how many survivors suffered what we now know as post-traumatic stress disorder -- damaged people who went unrecognized and uncared for.

Looking over the field from a trench

   When people today talk about how divided we are, how we don't tolerate fellow citizens who have different values, different lives, different views, I think to myself -- they are being myopic. We've seen plenty of division in American history, starting with the Revolution and including not just the Civil War and Reconstruction and Jim Crow and the Ku Klux Klan, but the Gilded Age and violent worker strikes, the 1950s and McCarthyism, the 1960s and Vietnam, and on and on. 

    It's an American tradition to speak our minds, get into arguments, divide ourselves by sex, race, class, ethnicity, region and religion. But hopefully our identity as Americans will overcome all that -- at least to the extent that we will never become so divided that we end up at a place like Cold Harbor again. 

Some Intriguing Questions

      We have a lot of questions going on in our minds these days. Have you been vaccinated? Do we have to wear masks? Is the Colonial pipeline back in service? Are those UFO sightings for real?

     Well, we Baby Boomers have some questions of our own.

     Have you ever heard of the Teacup List? Instead of the Bucket List with its dramatic before-I-die goals, and the panicked feeling you get when you realize you haven't gone on that cross-country road trip or parachuted in the Gobi Desert, you focus on the smaller, more doable things . . . like the ones Laurie Stone of Musing, Rants & Scribbles outlines in What's on Your Summer Teacup List? 

The Coleman Still

   Carol Cassara of the blog Heart, Mind Soul, asks: Do you ever think of times gone by? At our age, she says, we've got enough years behind us to remember a lot of places and a lot of people. In When Memories Take Us to a Different World she reflects on some friends -- and a California eatery called The Coleman Still -- from back in the hazy days of the 1990s.

     Can social media be fun? Yes, according to Rebecca Olkowski. But it can also be intimidating, especially when you see people your own age flaunting what they have done, or how great they look. In Is Social Media Making You Lose Your Self-Esteem? she elaborates on how oversharing by some people can make you worry that you're too fat, too old, too poor or too disorganized. If that bothers you, she includes a link to a comic-serious video by Trevor Noah about the harmful effects of social media.

     Jennifer of Untold and Begin asks: Am I Brave Enough to Live Creatively? It's important to dare to be the person that we are at our core, she says. Living creatively means living your version of yourself -- not someone else's -- which could be the motto of every retiree in America.

Surprise visitor

     Do you want to travel? A lot of us hit the road, or the skies, before the pandemic blew in. Meryl Baer of Beach Boomer Bulletin couldn't wait to get on the go again. In Up, Up and Away she recounts her first trip in months, to a family event in Florida, and laments her on-again off-again affair with a budget airline.

     Finally, speaking of the hazy days, Rita Robison asks: Do you have a garden? In this week's post she says Growing a Vegetable Garden Is Easier Than You Think . . . and offers a few of the benefits of tilling the soil, including a surprise visit by a cute little animal or two.

     As for me, I think I'll get to work on my Summer Teacup list, which will include a small, non-vegetable garden, two trips (one to Phoenix, one to Wisconsin), probably more time on social media than I should . . . and no doubt a few meet-ups with family and old friends when we will reminisce about the hazy days of the 1990s and before.

Travel in the Time of Gas Shortage

     We were vacationing at the beach in South Carolina while visiting family outside of Charleston. We did not venture into the city, as we usually do (the streets are crowded, we were told, and nobody is wearing a mask), but instead we focused on family and hung out in our beach community.

Rolling dunes protect the shoreline

     The beach was great. But a few days before we were scheduled to go home, the Colonial Pipeline went down. (I have photos of the beach here, not gas pumps -- they're prettier.) But how were we going to make the drive home -- a little over 700 miles -- with no gas?!?.

     As soon as I heard about it, on Monday last week, I filled my tank -- before the crowds arrived at the gas stations. But we were traveling back and forth between the beach and the grandchildren's house, so by the time we left, the tank was down to a little over half. On Wednesday and Thursday we saw several gas stations that were empty, trucks parked out in front of the pumps, black bags covering the handles.

A long walk to the beach

      How bad is this? we wondered. Should we see if we could stay over a couple of extra days until gas was more readily available?

     Our kids suggested that if anyone had gas, it would be Costco. So on Friday, the day before we left, B stopped off at Costco. There was a line. But there was also gas, and she was able to fill up.

The sand was dotted with jellyfish

     Still, we couldn't make 700 miles on one tank of gas. We'd have to stop once along Route 95. I checked online. Pilot Flying J showed many of its locations out of gas. TA Truck stops offered no information about the situation. Love's had a list of stations that were out of gas or "in danger" of being out of gas. But most of its locations seemed to have supplies.

     We decided to leave as planned. Online I found several stations along our route that said they had gas. But would they in real life?

A man casts for dinner

     We set out on our trip, along I26, turning north on I95. We watched the gas gauge sink from full to three quarters to half. My odometer estimates how many miles we have left in the tank. We started at 520 miles. We got down to 400, then 300. At 240 we reached the Virginia state line, where my research indicated there was a Love's with gas.

     We exited the highway and saw the station. It was crowded, but we found a pump. When I went to insert my credit card I saw the message: Please wait. Pump temporarily out of order.

A bird finds some food

      I saw a guy leaning against his car on the other side of the island. I asked him if he knew what was going on. Apparently there was gas at several of the pumps, but not all of them. Which ones? Probably the ones with the long lines. The place was a madhouse.

    Then I noticed Flying J across the street. It wasn't too crowded, but there seemed to be activity. So I crossed over and pulled up to a pump. It was working. We were able to fill up.

The end of a day

     We got home as scheduled, on Sunday, gas emergency notwithstanding. The fact is, we saw a lot of cars and trucks on the road, traffic as usual. The gas shortage didn't seem to stop anyone. And when you think about it, it's pretty impressive that the petroleum infrastructure was able to refill the network as fast as it did.

     People blame the big oil companies for global warming. Sure, they have something to do with it. But the real problem is the American public that is addicted to driving -- typically in a gas-guzzling SUV, at a gas-guzzling speed of 70 or 75 mph.

     But that's not really my point. (Okay, we're addicted to driving, too, but at least we don't drive an SUV and we try to keep it to a more efficient 65 mph.) I just want to say: It was great to be traveling again after our long quarantine. It was great to see the grandkids. And we got home. Safe and sound. 

Interesting Facts and Figures

      I ran across a report entitled Older Americans: Key Indicators of Well Being. It came out last fall, so it's possible you're a step ahead of me and have already seen it. But a lot of this information is new to me. The report acknowledges that it does not include the effects of Covid-19. But it does contain the most current data available.

     Here are a dozen highlights you might find interesting:

     There are roughly 52 million people age 65 and over living in the United States today, accounting for 16% of the population. That compares to just 35 million people in 2000 -- and a projected 73 million, or 21% of the population, ten years from now.

     Less than half of women 65 and over are married. The married rate for women is 46%, compared to 71% of men who are married. Some 32% of women are widowed, and 11% of men.

     About 30% of people 65 and over have a four-year college degree, and 86% have a high school degree.

     Older people have a lower rate of poverty than any other age group -- just 9% of people age 65 - 74, and 14% for people age 85 and over. Overall, the poverty rate of people 65 and over has decreased from 15% in 1974 to 10% today.

     Social Security benefits for women have changed dramatically, from spouse-only or widow-only benefits to earned worker benefits. Today some 80% of female beneficiaries get earned worker benefits.

     We're getting wealthier. Since 1989 the median net worth, adjusted for inflation, of households headed by people age 65 and over has increased by 60% -- from $158,225 to $253,800.

     On average, for people age 65 and over, some 33% of their income went to housing, 14% to transportation, 13% to health care, 13% to food. For those who are older, age 75 and over, the figures are 36% for housing, 16% for health care, 13% for food and 12% for transportation.

     Life expectancy has increased for everyone -- men and women, white, black, Hispanic and Asian. In just the last decade alone, life expectancy for men at age 65 has increased from 17.2 years to 18.1 years. For women the increase is 19.9 years to 20.7 years. (But Covid has no doubt changed these numbers, at least temporarily.)

    Death rates for heart disease, cancer and diabetes have gone down. Death rates for Alzheimer's disease and injuries have gone up. (About 7.5% of people 65 and over not living in nursing homes are reported to have dementia.)

     About 22% of people age 65 and over report some kind of disability -- vision, hearing, mobility, cognition.

     Only 14% of people 65 and over participated in physical activity that meets recommended guidelines. The obesity rate has increased from 22% in 1990 to 40% today.

     Some 13% of people age 65 to 74 admit to limiting their driving to daytime hours because of their vision or health. (Okay, I admit it! Well . . . I will drive at night; but I prefer to drive in daylight, especially on unfamiliar roads.) Meanwhile, only 41% of people 85 and over limit their driving to the daytime. (IMHO that figure should be higher . . . I remember my dad driving when he was in his late 80s, it was a scary ride!) 

     If you want to know more about the lifestyles of older Americans, you can check out the report yourself at Older Americans 2020: Key Indicators of Well Being. It's only, um, 184 pages long.

Second Home -- a Good Idea?

      So my wife and I are finally traveling. We're vacationing in South Carolina and visiting children and grandchildren while we're here, as we've done almost every year since the kids moved down from New York in 2012.

     We always get our own place when we come. Their house really isn't big enough to accommodate us. Plus, we'd rather be out at the beach rather than in the suburban development where they live.

Our rental. Would you buy it?

     It only takes a few days for us to become accustomed to the Carolina beach lifestyle, which at this time of year involves throwing open the windows to the sea breezes, wearing t-shirts, and going out to the beach or up to the marina to watch the sunset.

     And it only takes a few more days before we start looking around and begin thinking about buying a second home at the beach -- or near the beach. Lots of other people do it. Why can't we?

     Just last night we ate outside at the Salty Dog Cafe. We were outdoors so we didn't have to wear masks. There was a nice breeze wafting off the water so we didn't even have to worry about Covid. After dinner we walked up along the boardwalk, got ice cream, then stuck around to watch the sun set over the sailboats. We strolled down the boardwalk, eyeing the condominiums that face the water and the sinking sun beyond. 

     This morning I recalled reading an article about owning a vacation home by Jeremy Kisner, director of financial planning at Surevest Private Wealth in Phoenix, AZ, who writes a blog Clear and Concise Financial Advice. I thought I'd better consult the piece to get a dose of reality. Is it really a good idea?

     Here's what Kisner says about second homes:

     I thought vacation homes sales would be breaking records since Baby Boomers are better positioned to buy them than any previous generation. A number of other factors should also be propping up the vacation home market: a strong economy, a decade-long bull market in stocks, low mortgage rates.

    However, vacation-home sales, despite having picked up within the last year due to the crosscurrents of Covid, have actually been relatively weak for the past decade. For example, price appreciation in popular vacation home areas lagged non-vacation home areas by some 10 percentage points from 2015 through 2018.

     One reason vacation home sales have lagged may be airbnb and other similar sites. These services have made it easy to find vacation rentals in desirable places -- without any down payment, mortgage or upkeep costs.

Jeremy Kisner

     Are you still tempted to buy a beach house, mountain cabin, or Gulf-side condo? If so . . .

Here are a few things to consider before buying a vacation home:

     Costs. The median vacation home price nationwide is over $200,000 -- higher in popular beach locations. In Delray Beach, FL, for example, the median house price is over $300,000. Even if that seems reasonable to you, do not underestimate the ongoing expenses. A modest home will likely have up to $1000 in monthly expenses (taxes, utilities, HOA, maintenance).

     Financing. Approximately 30% of second-home buyers pay all cash. The remaining buyers need to come up with a hefty down payment. Most banks require 25 to 30% down on a vacation or rental property. They also require a higher credit score and charge higher interest rates. This is because these properties have more severe default rates than primary residences.

     Insurance. Homeowner insurance tends to be more expensive for vacation homes than for primary residences, because vacation homes are at greater risk for damage or theft since they are not lived in year-round. You may be required to carry a "landlord policy" which can cost 20 or 30% more than typical homeowners insurance. In addition, many homes are in hurricane or flood zones. Due to more severe storms, flood insurance costs have gone up significantly in recent years.

     Renting it out. People who rent out their vacation homes do so for an average of 18 weeks per year, according to HomeAway, a vacation rental marketplace. Property management firms typically get 20 to 35% of the rental income. Or you can do the work yourself. Some people make a decent side income by renting out their guest house on airbnb or VRBO. However, it usually takes a few hours a week to respond to inquiries and coordinate check-ins, check-outs, reviews and cleaning services. For more information about potential rental income vs. expenses consult this rental income resource.

     Classification as a Rental Property. If you limit your personal use of your second home to 14 days, or 10% of the time it's rented, it can be classified as a rental (investment) property. That means you can write off most of the expenses (insurance, maintenance, utilities, interest, depreciation) against the rental income. If the result is a loss, it is typically considered a Passive Activity Loss which in most cases can be used to offset other income on your tax return. 

     Classification as a Vacation Home. On the flip side, your property will be categorized as a vacation home if it is used primarily for personal use. You do not get to write off all the expenses like you do with a rental, but you can still write off the interest expense as an itemized deduction assuming you meet the requirements. In addition, you can rent your place for 14 days or less and keep that rental income tax-free, with no extra reporting requirements.

     Second homes can be a great place to make memories with your kids and grandchildren. They can also be a major expense and/or commitment of time. So a piece of advice: the wealth-maximizing strategy for a second home is to have a friend or relative with a vacation home ... and then an offer to house sit.

Exploring a New World

      Like the ancient mariners who set out from Europe to discover the New World, we set out from our home in Pennsylvania to test the waters of the Post-Covid World. We're headed to Charleston, SC, to see children and grandchildren. But on the way we stopped in Williamsburg, VA, to meet up with friends and tour the Colonial capital.

     Williamsburg, capital of Virginia from 1699 to 1780, is now restored as a living-history example of an 18th century Colonial town. We spent the evening there, walking around the historic streets, meeting some of the guides, seeing a few of the old buildings.

     But we were more interested in nearby Jamestown, the first English colony permanently established in America. (The first was Roanoke Island in the 1580s -- known as the Lost Colony because the settlers mysteriously disappeared.)

     As we went through the museum we discovered that in May 1607 a little over a hundred English settlers in three sailing ships landed in Jamestown. They built a fort, tried to grow some food, and were soon set upon by the local Powhatan. As you know from middle-school social studies, the story gets complicated from there, with Captain John Smith and Pocahontas and the arrival of "20 and odd Negroes" in 1619.

     Many of the settlers were killed, or starved to death, but the settlement did survive and remained the capital of Virginia for almost a hundred years. We saw a re-creation of the fort, a Powhatan village, and two of the three ships that carried the settlers.

     Of course, B and her friend had to stop in the gift shop. So while I waited I perused the 50 state flags flying outside the museum. Small factoid: We all know what the original 13 states were. But do you know the 14th state? It was Vermont, which seceded from New York in 1777, and was admitted as its own state in 1791. Vermont's constitution of 1777 was the first to provide universal suffrage and the prohibition of slavery.

     Then we took a ferry across the James River and had dinner on the outside deck of a waterside restaurant . . .

     . . . and ended the day watching the sun set over the James River.

     So we're traveling again. I can report that almost all the people stopping into the highway gas stations and restrooms were wearing facemasks and keeping their distance. So far so good. More than a hundred of the original Jamestown settlers died from starvation, Indian attack or malaria. We're pretty sure we're safe from starvation and Indian attack. We'll see if we survive Covid-19.