Best States to Retire From Costa Mesa

Costa Mesa Can Be Expensive on Seniors

Let’s face it, Orange County is an amazing place to live, but it certainly can be expensive day in and day out. Continuing with our Senior Week theme here on CostaMesaRealEstate.com, we’ll look at areas of the country that are less expensive for those thinking of retiring out of state.

Of course many states are having budget troubles and economic difficulties given the overall economic climate, but a few states standout for cost of living and little tax. The Tax Foundation released these states as the top 5 states with highest tax burden, so be wary of these if you are thinking about these states: 1. Connecticut 2. New Jersey 3. New York 4. Massachusetts 5. Maryland.

OK, so perhaps it’s better to just visit the Northeast. So what are the Best States to Retire From Costa Mesa? Here are the least expensive tax states:

1. Mississippi5 Lowest State Tax Burdens

Income tax: 5%
Sales tax: 7%
Property tax per capita: $785
Inheritance tax: None

Additionally Mississippi is exempt all IRAs from income tax. The change makes Mississippi one of four states to allow citizens to contribute to retirement accounts without paying state income tax on the money. Gotta love that!

2. South Carolina

Income tax: 7%
Sales tax: 6%
Property tax per capita: $963
Inheritance tax: None

I’m a bit partial to South Carolina, as I went to school at Furman University. It’s truly a beautiful and diverse state, much like California with great beaches and wonderful mountains. It had the least tax collections per person in 2009 (the most recent year available), according to the Tax Foundation.

3. Tennessee

Income tax: None
Sales tax: 7%
Property tax per capita: $752
Inheritance tax: See note*

Tennessee does not tax income (woo-hoo!), apart from a 6 percent levy on interest and dividends and capital gains are exempt. I’ve had good friends sell their Costa Mesa homes and retire or relocate to Tennessee based on the taxes there. It is a great state as well. Very different from California, but a wonderful area to consider for retirement.

4. Mississippi in Fall along the Natchez Trace

Income tax: 5%*
Sales tax: 4%*
Property tax per capita: $495**
Inheritance tax: None*

With low state debt, Alabama ranks among the states with the lowest taxes collected per capita–$1,770 per person in 2009, according to U.S. Census data and the Tax Foundation. That’s a far cry from what we see here.

5. Alaska

Income tax: None
Sales tax: None
Property tax per capita: $1,559
Inheritance tax: None

Ok, you might not consider Alaska after you have lived here, but financially those numbers look like they are making a lot of sense. Perhaps summering in Alaska and maintain a small condo here in Costa Mesa real estate? Just a thought 🙂