I wrote a post a couple of months ago similar to this one, but since then we've learned alot. The previous questions were more in relation to the pros/cons of a vacation home in FL vs a full time residence in FL. This post is going to be asking questions related to a permanent cross country move at age 60 AND a mortgage at this age (albeit not a big one, relatively speaking). Please give any input, all will be well received and taken into consideration, as I know there are very differing points of view....exactly what I'm looking for.
We are a 60 year old couple who are both retired civil service. Our combined pensions are around $8,600 a month net. We pay our BCBS health ins premium out of my husbands pension. That is already deducted from the $8,600. Our state (IL) does not tax pensions. Our property taxes are outrageous at $~7,400 a year on a home worth $275-300k (pushing it at being able to sell for 300k).
We have no debt. We own a new Honda Accord and a 2012 Jeep Grand Cherokee with only 40,000 miles on it (probably put 50 on it since covid March drama began). We are not extravagant spenders, we do like to travel, we are down to earth and really don't ask for alot. We have a son who is married living 15 minutes away. They have no children. We have a daughter with a family (2 grands) in Colorado. They do not plan to move back to IL and we do not want to live in Colorado Springs. Not our thing. The big draw to Colorado for us is just them.
Quick breakout of assets:
Home if sold would bring around $275,000 in cash. Very slow market in IL, high property taxes one reason. A concern is if we can even sell in this market with covid and all of the uncertainty, high taxes, etc. Homes just are not selling well here presently.
Savings/checking/money market liquid accounts: ~200k (this includes emergency fund $)
Taxable Vanguard investments currently ~$245,000 total stock market index admiral shares and total intl stock market index funds 80%/20%
TSP: Mine ~$380,000 G fund
TSP: His: ~$415,000 G fund
Roth Vanguard Me: ~$375,000 Life Strategy Moderate Growth 90% and intl stock market index fund 10%
Roth Vanguard Him: $~$345,000 Life Strategy Conservative Growth 85% and Intl stock market index 15%
529 for grandson ~$20,000
We've front end helped our adult children to the tune of paying for their 2 college degrees and giving each of them a very good chunk of cash for down payments on homes, to the tune of around $100k each. We thought we could afford to do that (we could) but we also never considered we would want what we do now and may need those funds. Well, hindsight is 20 20 and they are all doing well, employed, launched, self sufficient, so all is good at present.
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We have run the numbers, we have considered the change in lifestyle (we have wintered in Florida, Pinellas County specifically, for four winters and we love it there. No, we have not gone down in the summer but are kicking around flying down in a couple weeks to "feel Florida summer heat" (yes we understand this is a hot spot, but Pinellas County really is not, if we believe the numbers. Who really knows what's going on with this covid reporting??) as well as drive around areas and neighborhoods we have now zeroed in on). Bottom line is we really would like to make this move but we would like to do it within the next year or so. We know we would likely need to do the following: Sell our home, rent in FL, then purchase having cash in hand from our home sale, in order to get what we want (hopefully....who knows).
The quandry:
As of now the market in Florida is on fire. Homes are selling above asking price with multiple offers in a day. Example: we are not impulsive buyers, totally the opposite (note our investments --- conservative, probably too conservative but they fit us). We saw a home we loved online. We made an offer last week $20,000 above asking price (this is not us but we loved the home and were determined to make it work if we got it). The home was on the market 36 hours and had 21 offers. Needless to say, we did not get it. Probably a blessing but also a real eye opener as far as competition. This home was listed at $479,000. We bid $500,000. So, basically, if we live our dream, it is going to cost us. We have not had a mortgage in 25 years. We would have a mortgage at age 60! Yikes. NEVER in our long term plan. On the flip side, we could stay in our home, a very nice home that we love but much too big for us, and age in place and continue spending winters in Florida (I believe the Bogleheads vote will be for this option
Or, we could sell this beautiful 1910 Craftsman that is too big for us and go to a new little condo or villa or ranch home.....and probably spend more money here in IL also if we did this; probably an additional $100k to purchase something like this, end up with the same or higher taxes, a smaller cookie cutter home or condo, but would attain more freedom, less maintenance, zero entry amenities for old people, etc. It really makes no sense to move from our current home if we do not plan to relocate, unless we HAVE TO and can't age in place (or one of us dies). IF we relocate we are looking at mid century ranch homes out of the flood zone to avoid flood insurance, however, within minutes drive to the beaches, as that is really what we love. For a nice home in a nice area, something we would really be comfortable in (doesn't have to be big, in fact it will likely be 2,000 sf at the most and probably smaller) it will cost us for sure around $500k-$550k at this time (market could drop in months --- who knows? but as of now its premium $ sellers market). If the stars aligned and we sold our home, we'd have our home equity plus some of our savings and we would likely still need to borrow around $150,000 estimated. I understand this is not a huge mortgage, and we certainly can afford it at todays rates (with both of us alive), but gosh, we honestly never thought we'd be in a position of having to get a mortgage at our age to "live our dream". Is this absurd? I think our bubble has been burst in the last couple months of fine tuning this plan and understanding the FL market is VERY DIFFERENT, the cost of homes, car and home insurance, etc higher, oh and there are critters and big insects and hurricanes yes we know :/ Any thoughts on any of this, good or bad? We are blessed and fortunate to be where we are in our lives and we don't take that for granted. We certainly could just sit tight. We don't want to throw caution to the wind. On the other hand we have this itch that wont go away, and that is moving to Florida and living near the beaches. It just suits us. If anyone has done this sort of thing, or thought about it, or thought oh my gosh no way never, please advise. Any info from this group always gives us more to think about. Covid, we are not living in fear about; we wear masks, we social distance, we wash our hands, we do our best. I understand no one can make our decisions for us and again any input is valuable. Thank you all. Stay safe.
