Dear Banklady: I am a smoker that lives in Florida considering retirement in a few months. Should I consider Arkansas when retiring since there are less worries of hurricane insurance?
I don’t know for sure about Arkansas. I do know that Fayetteville has a pretty strict anti-smoking law, Arkansas itself a much less strict law which is very mild compared to Florida’s.
And there’s a six per cent income tax in addition to the sales tax…and your pensions, since they’re not Social Security income, will be almost all subject to the income tax (there’s only a $6000 exemption for pensions, but a total exemption for Social Security benefits, which does not seem fair to me—lots of retired teachers, cops, firemen, and, yes, civil service workers are under pensions instead of Social Security and are obviously getting taken advantage of by that law)
However, I understand that when you have to pay state income tax, you can deduct some of it, at least, from your federal income tax return. Not sure that evens it out, though. We’ve no experience with that because Florida, like Texas and only a few other states, has no state income tax. In any case, I think you should definitely have an accountant you with tax returns, at least the first few years if you move there, because of all those complications. After you move you may have the sale of the house (profits from the sale of your home are, as I understand it, exempt from capital gains tax under federal tax at least), moving expenses, and probably other major expenses to consider as well