It's a terrible mistake to ignore dividends when you're investing, as they can be powerful aids in growing your portfolio while you're still working, and they can serve you particularly well in retirement, too. But don't think of dividend-paying stocks as only appropriate for older investors.

Here's a look at five key reasons you should consider adding some (or many) dividend-paying stocks to your portfolio.

Image source: Getty Images.

The first reason is perhaps the most obvious one: Dividend-paying stocks generate income. As an example, if you have a portfolio worth $400,000 with an average dividend yield of 3%, you're positioned to receive $12,000 each year, just from dividends. That money can be reinvested in additional shares of stock, to plump up your portfolio further, or it can be used for living expenses.

Dividends aren't typically static, either: When they're being paid out by healthy and growing companies, they tend to be increased over time -- often annually. This can help your income streams keep up with inflation, which has averaged about 3% annually over long periods.

Check out a few examples below.

Company

Recent Dividend Yield

5-Year Avg. Annual Dividend Growth Rate

Starbucks

2%

20.7%

Microsoft

1.1%

10.5%

PepsiCo

3.1%

7.8%

Target

1.8%

4%

Chevron

7.2%

3.8%

Data source: Author calculations, Yahoo! Finance.

When you search for dividend-paying stocks for your portfolio, look not only for a meaningful yield, but also a payout that's growing well over time.

Another upside of dividend-paying stocks is that they're often relatively stable, compared to stocks of other companies. This is not always true, of course, but in general, for a company to commit to paying its shareholders a certain sum on a regular basis, its managers will be fairly confident of reliable revenue and earnings. That's why you'll find that a large proportion of blue-chip stocks are steady dividend payers. (On the other hand, many relatively young and fast-growing companies do not pay dividends at all, because they're plowing every available dollar into furthering their growth.)

Remember, too, that dividend-paying stocks don't merely offer dividends. The shares are still tied to companies that are working hard to grow and become more valuable over time. Thus, if you invest in healthy and growing dividend payers, you'll likely enjoy not just dividend income that increases over time, but also a stock price that increases over time -- and not necessarily at a paltry rate.

Indeed, when academics Eugene Fama and Kenneth French studied stock market data from 1927 to 2014, they found dividendpayers outperformed non-payers, averaging 10.4% annual growth vs. 8.5%. Here are some more examples of dividend payers:

Company

Recent Dividend Yield

10-year Avg. Annual Stock Growth Rate

Sherwin-Williams

0.8%

25.2%

Lowe's

1.5%

23%

Nike

0.8%

21.2%

Costco

0.8%

19.8%

Amgen

2.6%

17.4%

Discover Financial Services

3.3%

14.4%

Clorox

2.1%

13.9%

Kroger

2.2%

13.1%

Verizon Communications

4.3%

9.7%

Data sources: Yahoo! Financial and theonlineinvestor.com.

Finally, if you're relying on income from dividend-paying stocks in retirement and you end up not needing to sell off those shares over time for additional cash, you'll be able to leave them to your loved ones. This is a meaningful advantage over some other income-producing options, such as annuities. Fixed annuities have the advantage of providing even more reliable income, and they are worth considering in your retirement planning. Indeed, you may end up wanting to set up income streams in retirement from both annuities and dividends.

Don't dismiss dividends as only suitable for older investors and retirees. They have a lot to offer investors at every stage of life.

Originally posted here:
5 Reasons to Invest in Dividend-Paying Stocks for Retirement - The Motley Fool

GARDNER Fire Chief Richard Ares was honored by local and area elected officials as he prepares to call it a career after nearly half a decade on the job. Ares will retire on Wednesday, Sept. 30, after 47 years with the department.

Ares decades of service to the city were recognized by U.S. Rep. Lori Trahan, D-3rd, on Monday, Sept. 28. While at the department to officially announce a $240,000 federal grant her office helped secure for the purchase of new breathing equipment, Trahan said she used the opportunity to present Ares with a congressional proclamation to honor his exemplary service to the city.

Chief Ares has devoted his entire life to the city of Gardner, where he has always called home, obtained a degree in fire science from Mount Wachusett Community College, and began his honorable 47-year career on the Gardner Fire Department, Trahan read from the document. The residents of Gardner, as well as the commonwealth of Massachusetts, are grateful to Chief Ares for his extensive (career) as a firefighter, where he faced continual danger without hesitation for the betterment of his community.

Ares said stepping down for the job he has loved is a bittersweet moment.

Obviously, Im going to miss it, Ares said. The part Im going to miss most the guys were asking me this this morning is running to calls. I still love running to calls and doing the so-called street work, but its been a good ride, its been a good time, and its been what Ive always wanted to do, even when I was a little kid. I feel lucky that I got to do what I always wanted to do.

Ares started with the citys fire department as a substitute call firefighter in 1973, becoming a permanent member two years later. He climbed through the ranks of the department, serving as a fire lieutenant for 20 years, and then captain, and eventually fire chief. During his tenure he was selected as a fire investigator, providing skilled analysis in the wake of countless emergencies. He devoted nearly 12 years to teaching life-saving techniques and training fire recruits from across the state as an instructor at the Massachusetts Firefighting Academy.

The job has changed greatly over the years, Ares said, adding that he began keeping a journal of all of the calls he went on starting in 1983. As I go back through the old records, I see that we didnt do as many calls (in the past), but the majority of them were fires. Now, were actually more of an all-hazards department more than truly a fire department we handle all kinds of emergency incidents. People call us for everything.

Mayor Michael Nicholson said the city is grateful for Ares years of service to the community and its residents.

If you spend 47 years and five months in one community thats dedication in and of itself, Nicholson said. Our birthdays are a day after each other. I just turned 26 and he just turned 65, so for all of my life, hes been here in Gardner just making a difference. And I think thats incredible.

Nicholson noted that his relationship with Gardners longtime chief extended beyond the city limits.

When I was marching in the UMass marching band, he was the official photographer for the band, so weve been joking that now that hes leaving the fire department, his photography services will be better, Nicholson said. But I cant thank him enough for all hes done here. You cant look at the Gardner Fire Department and not see the impact that Richard has made here. So Im looking forward to seeing him relax but also to see how we can continue the work he started here as we move forward.

State Rep. Jon Zlotnik, D-Gardner, said Ares commitment to the city has meant a lot to its residents for nearly half a decade.

Gardner is a city, but I always say its a big town, and people like Chief Ares really dedicate their whole lives to the city and make things better, said Zlotnik. You look at a lot of the changes the chief has brought to the department to modernize it especially when it comes to equipment and training I think that has really been a focus for him, and those crucial decisions are always paramount whenever youre talking about firefighting services.

City Hall would be lit up in red over the next few days in honor of Ares years of service to the city, Nicholson said.

Read the original here:
Gardner Fire Chief Richard Ares honored on the eve of his retirement as U.S. Rep. Lori Trahan officially announces $240K grant for his department -...

Having a six-figure budget in retirement requires a large nest egg.

You will need to save at least $2 million if you want to spend $100,000 per year in retirement, according to experts. This scenario assumes that you withdraw 5% of your savings per year, which leaves little room for error.

But you shouldn't plan your retirement based on best-case scenarios.

You should aim to spend around 4% of your nest egg per year in retirement, according to financial advisor Winnie Sun. That percentage can drop, however, based on several factors such as if your home isn't paid off or if you have high health-care costs, Sun said.

This strategy also assumes that you have a balanced portfolio, focusing more on bonds and cash-type investments for your short-term needs. This allows the stocks in your portfolio to grow for the future, according to Sun.

Check out this video to see a few different case studies of how much spending money you'll have if you retire on $2 million.

More from Invest in You: 'Predictably Irrational' author says this is what investors should do during pandemic Coronavirus forced this couple into a 27-day quarantine on their honeymoon cruise How to prepare for a family member with COVID-19

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CHECK OUT:Why January is a particularly great time to invest your moneyvia Grow with Acorns+CNBC.

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Here's what your monthly budget will look like if you retire with $2 million - CNBC

David Parmer announced his retirement as CEO ofBaptist Hospitals of Southeast Texas on Sept. 29, 2020.

David Parmer announced his retirement as CEO ofBaptist Hospitals of Southeast Texas on Sept. 29, 2020.

Photo: Courtesy Of Baptist Hospitals Of Southeast Texas / Courtesy Of Baptist Hospitals Of Southeast Texas

David Parmer announced his retirement as CEO ofBaptist Hospitals of Southeast Texas on Sept. 29, 2020.

David Parmer announced his retirement as CEO ofBaptist Hospitals of Southeast Texas on Sept. 29, 2020.

Parmer to retire as Baptist CEO after more than 30 years

David Parmer has led Baptist Hospitals of Southeast Texas through growth, change, pandemic and more than a few natural disasters as CEO of the health group for more than three decades, but after next summer he will be passing on its future to the next generation of leadership.

Parmer announced his retirement Tuesday and will be stepping down as CEO at the end of next June. He will be staying on in an advisory role for two years during the leadership transition, according to the health group.

Parmers decision was announced by the health groups board of directors, who heralded his time with Baptist.

The entire board is extremely supportive of Davids decision and thankful for his many years of friendship and exemplary leadership, Gary Coker, board chair, said in a statement. Board members, hospital staff at all levels and the community at large have greatly benefited from Davids highly participative leadership style, sense of commitment to Baptist Hospital, and desire to reach the best solutions and decisions during the best and worst of times. David has truly been a great leader.

Baptist Hospitals of Southeast Texas was founded in 1945 to answer a shortage of hospital beds in Beaumont. Baptist celebrates its 75th anniversary this year.

Parmer joined Baptist in 1989 after gaining administration experience at hospitals and health groups in Louisiana. He previously worked as a controller with the U.S. Department of Veterans Affairs but decided to head to graduate school at the University of Alabama-Birmingham in search of a career that would allow him to help people beyond the finance world.

Early in his career, he had to oversee the creation of a new hospital in central Beaumont and the decommissioning of the old one.

Services at the hospital expanded under his tenure and Baptist joined with the Cancer Center of Southeast Texas and Altus Cancer Center to create the Baptist Hospitals of Southeast Texas Regional Cancer Network in 2017.

Parmer and Baptist as a whole have had to adjust to changing dynamics in health care, such as rising costs and migration of inpatient services to other offices.

In 2016, the decision was made to close the emergency room at the former Orange hospital, ending Baptists services in that area.

As CEO, Parmer also had to lead the hospital through disasters such as hurricanes and most recently the COVID-19 pandemic.

Parmers predecessor will be chosen by a newly appointed search committee and the Witt Kieffer executive search firm.

Candidates will be interviewed between January and February 2021 with the plan to have final candidates visit Beaumont between March and April. Baptist anticipates a new CEO will assume office by the end of June 2021.

jacob.dick@beaumontenterprise.com

twitter.com/jd_journalism

Read more:
Parmer to retire as Baptist CEO after more than 30 years - Beaumont Enterprise

For Americans with access to them, workplace 401(k)s can be the simplest type of retirement account. After all, signing up for one just involves doing a little paperwork and requesting to have money withheld from your paychecks. And in some workplaces, the default is to auto-enroll you, so you really don't have to do much of anything. Many employers even offer matching funds, so you get access to free money by contributing.

But while you definitely want to put at least enough into your 401(k) to earn the maximum employer match, using a 401(k) as your only retirement account may not be the best move. In fact, there are some big pitfalls to putting your money into this account exclusively. Here are three of them.

Image source: Getty Images.

Most 401(k) accounts offer a very narrow pool of investment options. You're usually restricted to a few index funds or target date funds and cannot purchase shares of individual stocks. If you invest some of your money in an IRA, however, you'll have access to a much wider pool of investments -- any that your brokerage of choice offers. You can even open up an IRA that allows you to choose non-traditional assets, such as gold or bitcoin.

While you take on more risk by buying shares of individual companies -- and alot more risk by buying some of those non-traditional assets -- you also have the potential for much higher returns than if you stick to just the funds your 401(k) provides. If you're willing to branch out and put in the time to find the right investments, it's definitely worth putting some of your retirement money in accounts that give you more freedom.

Some 401(k) accounts have management or administration fees that eat into your returns. The funds your 401(k) allows you to invest in may also carry higher fees than others that might be available with the broader range of choice a brokerage firm provides.

Fees can make a measurable impact on the amount of money you end up with in retirement. If your workplace plan has them in abundance, you're doing yourself a real disservice if you use it as your exclusive retirement account. Instead, in this situation, you should only contribute enough to get the match and then look for a broker that offers a no-cost IRA with a choice of affordable investment options.

Distributions from a 401(k) are taxed at your ordinary income tax rate. Distributions from a Roth IRA or Roth 401(k) are not taxed. If you have access only to a traditional 401(k) at work and use it as your sole retirement savings account, you'll owe more in taxes in your later years than you would've if you'd put some of your money into a Roth IRA and taken tax-free distributions to help support you.

Social Security benefits also become partially taxable once your income hits $25,000 as a single tax filer or $32,000 as a joint tax filer. But not all income is countable. Your 401(k) distributions are included when determining if Social Security benefits will be taxed, but distributions from Roth accounts aren't. If you put all your retirement savings into a 401(k) and withdraw enough to cross the threshold at which you owe tax on Social Security, you'll owe even more money to the IRS that you wouldn't have if you'd received some Roth income instead.

Since you could reduce the size of your nest egg by getting hit with fees and limiting your investment options and get to keep less of your money due to higher tax bills, sticking with a 401(k) alone could really hurt your prospects for financial security in retirement. Instead, consider splitting your money up among several different retirement plans so you can reap the benefits that each provides.

Read this article:
3 Pitfalls of Only Using a 401(k) for Retirement - The Motley Fool

Knowing where you spend your money has gotten easier and easier, thanks to programs like Quicken and websites like Mint.

The late economic historian W.W. Rostow had long-term roles in the administrations of two presidents. But hes probably best remembered for his 1960 response to the challenge of communism.

It was a book titled The Stages of Economic Growth: A Non-Communist Manifesto.

In it, Rostow identified five stages of economic development. The stage most people talked about was the "takeoff, the moment when a nation saved enough that the savings per capita began to grow.

Thats also when income began to grow. And when new opportunities appeared. Its when a nation could get off the Malthusian treadmill with population growth exceeding any increase in savings. Rostow looked around the world. He saw getting to that moment as a challenge and an opportunity.

I loved that book. It set a great mood of possibility and mission.

But if entire nations have a takeoff point, so do we as individuals. So do family households. Better still, if we reach our takeoff point, were on the way to getting off the payday treadmill. Were on the way to a secure retirement at least, or early financial independence at best.

The sad part is that so few get there.

Many never reach their takeoff point. Instead, they buy a new car, take an expensive vacation or decide their 4,000-square-foot house desperately needs an outdoor kitchen. They borrow to spend. They guarantee they will be repaying debts rather than starting to save or adding to savings. They choose to own things that decline in value rather than appreciate. They collect things that consume income rather than create it.

Were not talking about the clueless here. An abundance of survey evidence shows that millions of people live in a financial condition that can only be described as precarious.

An amazing number of people missed the takeoff point memo.

So lets answer a simple question: How do you reach your takeoff point?

Spend less than you earn.

Its that simple.

Trouble is, no one wants to figure out how they spend their money.

Let me repeat that. NO ONE.

Ive been writing a personal finance column since 1977. I still havent run out of fingers for counting the number of people who can immediately say, Last year I spent this much on (insert category), spent this much on taxes and added this much to my savings.

But heres a blunt reality: If we dont make positive decisions about where and how we spend our money, well never control our spending. Well always be the victim of an impulse or a particularly effective advertisement.

Is there any good news here?

Yes! Knowing where you spend your money has been getting easier and easier. It doesnt require taking up permanent residence under a green eyeshade.

If you want to be detailed and fastidious, you can use a computer program such as Quicken. In a few months, youll know exactly where your money goes.

If thats too much bother, you may be able to do it through the services that run automatically on your bank account, your debit card and credit card. You can also put it all together by using Mint, a free online money tracker.

The important thing isnt how you do it, but that it gets done.

See original here:
Whats your takeoff point? The moment youve saved enough for retirement - The Dallas Morning News

When are we going to get real about the looming retirement and aging crisis in this country?

If we dont do something its going to make theCOVID-19crisis look like a walk in the park.

The latest evidence that theres an iceberg straight ahead comes courtesy of the Transamerica Center for Retirement Studies, which has just published its 20thannual retirement survey of U.S. workers.They commissioned polling company Harris to survey about 5,300 workers. Oh, and most of the data were accumulated last fall and winterbefore the crisis struck and made things even worse.Among all the depressing data points, arguably none is more gloomy than the news that 48% of women, and 56% of men, have a serious, well-thought-out plan for dealing with their long-term care needs when they get old.

The plan? Family and friends.

No, really.

Amazingly, they say spouses are only half of that as well. Theyre genuinely relying on friends, and family members other than spouses, to pitchin, too.

Read: Hope to retire someday? See if you can answer these six simple questions

Cue the sound of palms hitting foreheads in financial planners offices across the country.

As someone who once helped provide long-term care to a family member for over a year, let me say: You really dont want to go there if you can possibly help it.

A report commissioned by the U.S. Department of Health and Human Services found that about 70% of those who reach 65 are going to need long-term care at some point.

Boston-based financial planner Sandra Gilpatrick warns, You shouldnt assume your family will live near you to make care easy. They may have their own financial or life struggles making it a major burden or impossible to give care later.

She adds: Spouses close in age may think they can take care of each other when they have a conversation at 60. Fast forward to 85 and it is a tremendous physical strain to try to lift someone out of a chair. Giving care can rapidly deteriorate the healthier spouse as well.

Meanwhile, I dont want to give you the wrong impression. I dont want to suggest that the failure to prepare for long-term care needs is the only part of the survey that is alarming.

It isnt.

Among the men surveyed, the median household retirement savings were$69,000.

Heavens. A man of 65 with that amount of money can buy a lifetime annuity worth, oh, $330 a month according toimmediateannuities.com.Among the women surveyed, the median household retirement savings were less than half as much, a mere $28,000. Just under a third of the women surveyed had $10,000 or less set aside.

To give you a flavor of how dismal this is, if you type $28,000 into the Amount to Invest box at immediateannuities.com, to see how much of an annuity this will get you, it tells you that number is below their minimum threshold for calculations.

Mmm. Good times.

As usual, everyone is wringing their hands about the financial struggles of the poormillennial generation, but the picture arguably looks even bleaker for Generation Xthe largely overlooked cohort born between 1965 and 1980.

Generation X men reported median retirement savings of $80,000 and Gen X women $46,000. For people who are already aged 40 to 55, with diminishing numbers of years left in which to accumulate wealth, these are alarmingly low numbers. (By contrast, baby boomer men reported median household retirement savings over $200,000.)More than a quarter of Gen X women said they had less than $10,000 set aside for retirement.

Maybe its no wonder. Gen Xers have dealt with three or four once in a lifetime economic collapses in their adult careers, including not only Covid but also the Great Recession and the worst housing collapse since the Great Depression, the stock market crash, economic slump and terrorism crisis of the early 2000s, and a really dismal economic slump of the early 1990s.

They got little uplift from the stock market boom of the late 1990s, which came too early for them to have a lot to invest, but were around and pouring money into their 401(k)accountsduring the dismal decade that followed.

Ouch.

Meanwhile, the survey confirms that women are in a worse position for retirement than men. Thats because of the infamous double whammy. On the one hand they are likely to accumulate fewer retirement savings in the first place, because they are apt to earn less and take more time out of full-time work. But on the other hand they actually need more than men because they tend to live longer.

No wonder just over half of men and women polled said they planned to retire after age 65, if at all. And 38% of men, and 27% of women, say they plan to carry on working in retirement.

The only thing we know for sure at this point? This wont be your parents retirementfor good or ill.

Continued here:
Your retirement probably won't be anything like your parents'...and that's not good news - MarketWatch

Senior Hispanic man checking his finances online at home using a laptop computer at night Getty Images/iStockphoto

People who retire early suffer from accelerated cognitive decline and may even encounter early onset of dementia, according to anew economic studyI conducted with my doctoral studentAlan Adelman.

To establish that finding, we examined the effects of a rural pension program China introduced in 2009 that provided people who participated with a stable income if they stopped working after the official retirement age of 60.

We found that people who participated in the program and retired within one or two years experienced a cognitive decline equivalent to a drop in general intelligence of 1.7% relative to the general population. This drop is equivalent to about three IQ points and could make it harder for someone toadhere to a medication scheduleorconduct financial planning.

The largest negative effect was in what is called delayed recall, which measures a persons ability to remember something mentioned several minutes ago. Neurological researchlinks problems in this area to an early onset of dementia.

Cognitive decline refers to when a person has trouble remembering, learning new things, concentrating or making decisions that affect their everyday life. Although some cognitive decline appears to be an inevitable byproduct of aging, faster decline can have profound adverse consequences on ones life.

Better understanding of the causes of this has powerful financial consequences. Cognitive skills the mental processes of gathering and processing information to solve problems, adapt to situations and learn from experiences are crucial for decision-making. They influence an individuals ability to process information andare connected to higher earningsand abetter quality of life.

Retiring early and working less or not at all can generate large benefits, such as reduced stress, better diets and more sleep. But as we found, it also has unintended adverse effects, like fewer social activities and less time spent challenging the mind, that far outweighed the positives.

While retirement schemes like the 401(k) and similar programs in other countriesare typically introduced to ensure the welfare of aging adults, our research suggests they need to be designed carefully to avoid unintended and significant adverse consequences. When people consider retirement, they should weigh the benefits with the significant downsides of a sudden lack of mental activity. A good way to ameliorate these effects is to stay engaged in social activities and continue to use your brains in the same way you did when you were working.

In short, we show that if you rest, you rust.

Because we are using data and a program in China, the mechanisms of how retirement induces cognitive decline could be context-specific and may not necessarily apply to people in other countries. For example, cultural differences or other policies that can provide support to individuals in old age can buffer some of the negative effects that we see in rural China due to the increase in social isolation and reduced mental activities.

Therefore, we can not definitively say that the findings will extrapolate to other countries. We are looking for data from other countries retirement programs, such as Indias, to see if the effects are similar or how they are different.

A big focus of theeconomics research labI run is tobetter understandthe causes and consequences of changes in what economists callhuman capital especially cognitive skills in the context of developing countries.

Our labs mission is to generate research to inform economic policies and empower individuals in low-income countries to rise out of poverty. One of the main ways we do this is through the use of randomized controlled trials to measure the impact of a particular intervention, such as retiring early or access to microcredit, on education outcomes, productivity and health decisions.

Plamen Nikolov is an assistant professor of rconomics at Binghamton University, State University of New York. This was first published by The Conversation Retiring early can be bad for thebrain.

Read more:
This study finds that those who retired early lost brain power - MarketWatch

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If you are thinking of relocating when you retire, there are several things to consider before you make the move.

One of them may now be whether you should do it before you leave the workforce.

Thanks to the coronavirus pandemic, many Americans are working remotely and may be for some time to come. Several companies have added the option for employees to work from home for the rest of their career, including Twitter, which has said its employees can keep working from home "forever."

"The pandemic was unexpected, working from home was unexpected, but nonetheless many companies realized that workers can be just as productive working from home," said Lawrence Yun, chief economist for the National Association of Realtors.

"We may begin to see a boost in people buying retirement homes before their retirement."

Right now, the evidence is anecdotal, with demand rising in vacation resort areas, he said.

If you are going to relocate, you should be relocating for reasons that are going to make you happy.

Of those who have already entered retirement, 38% have moved to a new home, according to the 20th annual Transamerica retirement survey, released in September.

When choosing where to live, retirees' cited proximity to family and friends (61%), affordable cost of living (55%) and access to excellent health care and hospitals (46%), the survey found.

Whether you want to fully move ahead of your retirement, or buy a vacation home with the intent to use it full-time once you retire, you'll need to do some homework before you pack your bags.

In addition to family, cost and health care, retirees also look at the weather. Florida, which also doesn't have a state income tax, comes to mind for many, but it isn't the only warmer state retirees are flocking to.

There has been a general migration to Arizona, Nevada and Texas, as well, Yun said.

Miami Beach, Florida

ac productions | Tetra images | Getty Images

You can find a lot of information online about the area you may want to make your new home, but nothing beats giving it a trial run first. Consider extended visits if your work allows.

"You will get a pulse on the community," said Barbara O'Neill, an author, distinguished professor emerita at Rutgers University and CEO of Money Talk: Financial Planning Seminars.

"You want to find out about things like hospitals, social services, entertainment venues, [and] closest airports."

O'Neill did just that while she was working at Rutgers. She took a sabbatical and spent three months in Gainesville, Florida, in 2017 and 2018. In 2019, she did it again while working remotely. She's since left Rutgers and is living and working in Florida, about 30 minutes away from Gainesville.

Come up with a pro forma budget that has your best estimate of your income and spending after you leave your job, suggests O'Neill, whose latest book is titled, "Flipping a Switch: Your Guide to Happiness and Financial Security in Later Life."

Research the cost of living in the areas you are considering. Part of that is housing costs.

Housing affordability is a big reason people move when they retire, Yun said.

In particular, people from areas with expensive housing, like the Northeast and California, can find larger homes at much cheaper prices in other states. If they've paid off their homes, or close to it, they may be able to pocket a profit after buying their retirement home.

While prices are already rising, they may go higher the longer a person waits, he said.

"It seems like demand will remain solid for the upcoming years because the Fed has clearly made its intentions known that we will have a low-interest-rate environment," Yun said.

The mortgage rate for a 30-year fixed loan is 3.01%, as of Sept. 21, according to Bankrate.

However, just because demand may remain strong and prices may rise, you should be financially comfortable about making that retirement home decision, Yun advised.

"One wants to never overstretch their budget," he said.

Retirees tend to flock to lower-tax states, especially those with no state income tax, like Florida, Tennessee and Texas, Yun said.

Yet it may not be that simple, especially if you are still working.

You can only have one official domicile, and it is where you spend most of the year. It's where you register your car and vote.

More from Invest in You: How to take the mystery out of picking the best retirement savings plan for you Dreaming of retiring abroad? Here's what you need to know How to jump-start your retirement savings when you are in your 30s

Those who have bought a house in a low-tax state but still spend much of their time at their first residence can expect to be audited if they claim the low-tax state as their primary residence, warned Ed Slott, CPA and founder of Ed Slott & Co. in Rockville Centre, New York.

He had one case where the IRS did a three-year residency audit, which included a request for records of where the subjects spent each day, each year.

If you move out of state but are still working, you'll still be paying income tax in your employer's state. For example, if you are living in Florida, but your company is based in New York, you'll have to file taxes as a nonresident to New York.

If you relocate to a state that has income tax, there's a chance you can get caught up in being double-taxed, Slott said.

Some states have agreements that the resident state will give credit for the income tax paid to the state where the job is based, as New Jersey does for those commuting into New York. However, now that the pandemic has opened up remote work, people are moving farther away and they could wind up in a state that doesn't have such an agreement, Slott said.

Also, if you wind up working side jobs, you'll have to pay taxes to your new state of residence.

When checking out your specific tax situation, be sure to include your current state of residence. Many even high-tax states, offer huge tax benefits for seniors, Slott said.

"You might be surprised at how low state taxes are when most of your income is from Social Security and retirement accounts," he said.

After doing your research, make up columns or a matrix listing the pros and cons of staying and the pros and cons of moving, O'Neill said.

In addition to financial reasons, remember emotional ones, as well. In the era of Covid-19, a move to Texas may be too far from family members who don't want to travel by plane.

On the other hand, living in year-round warm weather allows for safer outdoor activities.

"If you are going to relocate, you should be relocating for reasons that are going to make you happy," O'Neill said.

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With remote work flexibility, some people opt to relocate ahead of their retirement - CNBC

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Born in 1988, I came of age during the Great Recession. I watched as the systems my parents and grandparents relied on like job security and pension plans morphed into mythology. I've always understood Social Security and Medicare as forms of political currency, not long-term solutions I can count on in old age. I'm a card-carrying member of the gig economy, more comfortable working for now, not for later. The very idea of "retirement" terrifies me.

But like all millennials, I'm aging. My back twinges after an afternoon spent working in the yard, fine lines are forming around my eyes, and the inevitable truth is upon me: Working until I die is not a viable option.

Like many people, one of the reasons retirement has felt so impossible for me is my lack of a road map. My grandparents had pensions, which is something I won't have. But as I look at their financially secure and abundant retirement years, I realize pensions can't possibly tell the whole story.

My grandpa was a warehouse worker and my grandma was a nurse. They must have done something to prepare for retirement to wind up as comfortable as they did, and maybe it's something I can emulate.

My grandpa passed away in 2006 and my grandma Ellen Young is now 84. I recently sat down with her to ask, "How in the world have you managed to live off your retirement savings for over 22 years?"

Her answer was both scarier and more accessible than a simple pension plan. According to my grandma, the key is to factor your retirement into every single financial decision you make. This is daunting, but she assured me, "It all adds up."

For her and my grandpa, this kind of thinking began in 1960, their first year of marriage. As my grandma remembers it, my then 30-year-old grandpa "would have retired right then if he could have."

My grandma married my grandpa at the age of 24; she had already been working as a registered nurse for three years. She didn't choose nursing for the retirement benefits, but my grandpa certainly chose his job as a factory worker based on the promise of being able to retire early.

This is an example of how important it is to factor your retirement into all your decisions. While few companies offer pensions these days, most salaried positions offer retirement packages. A far-off future may not seem nearly as significant as immediate job satisfaction, but while your career is a large portion of your life, if you're lucky, your retirement years will be as well.

Selecting a job with a clear-cut retirement plan isn't the only choice my grandparents made with retirement in mind, however. They factored their golden years into every choice they made, big or small. "I've always been frugal, only shopping sale items and saving every spare cent," my grandma said. For her, the single most effective savings come from avoiding interest-bearing loans all together.

My grandparents bought their first home in 1962. And while they purchased an older home sitting on 40 acres for the jaw-droppingly low price of $5,500, it cost them every penny they had. Always thrifty, my grandma refused to pay a penny more to drill a well or build her dream house until they had saved enough to qualify for a small mortgage with a low interest rate. It took three years, and even when they were ready to build a brand new house on their property, my grandma, with her eye always on retirement, kept her vision modest.

Understanding that this was the most important purchase she would ever make, my grandma's financial strategizing didn't end there. Over the years, she made as many extra payments on the mortgage as she could to pay down the principal. There were two layers to this retirement strategy: First, by paying down the principal as quickly as possible, she saved thousands of dollars on interest. And second, by eliminating debt, she alleviated her future retired self from making sizeable monthly payments.

Saving for retirement, as my grandma pointed out, doesn't mean just putting money in the bank, it also means keeping it there by minimizing your financial obligations.

It also means making that money self-propagate. When my grandpa's company offered him stock purchases, they began investing $5 at a time, increasing the amount as they could afford to. When their investments paid off, they took the money out and brought it to an investment broker who lived locally. In my grandma's view, trusting your broker is the single most important aspect of investing in stock, and for her, this meant working with someone who she could meet face-to-face.

Over the years, she stuck with relatively safe investments of her choosing, but she credits her broker with this crisis-averting advice she was eager to pass on: Diversify your portfolio.

"I was always careful with my money. I did my research and made sure I only invested in financially sound companies," she told me. But living in a motor town like St. Louis, and with a son-in-law who worked for Ford, she was comfortable putting all of her money in Ford stock.

"But when I tried to put all my money in Ford, my broker said he couldn't let me do that," she said. "Years later, after I retired, all those motor companies crashed, and I couldn't believe how much I would have lost if I hadn't followed his advice."

Individual retirement accounts played an important role in my grandparents' retirement plans as well. Taking any money out of your paycheck for a later date may seem impossible, but "later," my grandma told me, "you'll be glad you did."

As we spoke of retirement, we did the math. My grandma began her nursing career in 1957 and retired in 1998. Her life as a "working girl," as she calls it, lasted 41 years. She has been retired for 22 years, over half the amount of time she worked. She thinks of her retirement so far as the kind of golden years we all hope to enjoy: trips to Egypt and Germany, holding court with members of her Rose Society, scrapbooking with friends, and cooking large family dinners.

When I asked her what she would tell someone hoping to retire as securely as she has, she responded simply, "You can't work forever. You have to retire, so you need to plan for it."

Our conversation was made up almost entirely of wild numbers like $5,500 for a hilltop property with a house and $5 as a semidecent retirement contribution, but I realized the advice she gave me still works.

Even if $5 in 2020 will barely cover a medium latte, even if my used car is three times the cost of 40 acres in 1962, even if I don't have a pension, I can pay down the principal on my home loan, I can put a little more toward my IRA each month, and I can delay major purchases until I can pay for them in cash.

Things change, prices go up, social safety nets come and go, but some truths are immovable. I can't work forever, so I better start planning.

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My grandma's secret to a comfortable retirement for the past 22 years - Business Insider