Retirement in Michigan

Retirement is a time people want to stop working, settle down, put up their feet and enjoy life. Michigan offers retirees several enticements to live out the rest of their lives here in the Great Lake State. First, before you pack up your things and head to your retirement destination, you need to plan accordingly.

Start Retirement Plans Early

“People come to us and ask what people should do to retire successfully,” said Karen Reeves, financial advisor at Edward Jones Investments in Battle Creek, Mich. “I meet with them and talk them through a five-step process to help them reach their retirement goals. It’s vital to start early. This includes having them ask themselves: 1) Where am I today? 2) Where would I like to be? 3) Can I get there? 4) How do I get there? and 5) How can I stay on track?” 

AARP Michigan Associate State Director of Communications Mark Hornbeck adds, “AARP offers a retirement calculator that will help people decide whether they are ready financially to retire.”

 You can learn more about it and other factors to consider when retiring at AARP.org/retirement/.

How Does Michigan Rate Against the Rest of the US?

According to a ranking list on Bankrate.com dated June 20, 2017, Michigan comes in the middle of the 50 states, at number 22. Bankrate ranked the states based on how they were rated by what respondents wanted when they retired, including:

  • Cost of living
  • Quality of health care 
  • Crime rate
  • Cultural life
  • Weather
  • Taxes
  • Overall wellbeing of seniors
  • Number of other seniors living in the state

In exact ranking order, Michigan was rated 18th in cost of living, 43rd in weather, 19th in health care, 22nd in crime rate, 26th in taxes, 36th in culture, 18th in number of seniors and 27th in overall wellbeing of seniors. The number one state on their list was New Hampshire, with Alaska at the bottom of the 50 states. 

From Beaches to Forest, Michigan Has It All 

There are lots for retirees to do in the 26th state of the union, and leisure activities are high on the list. 

“One of Michigan’s unique advantages for retiring here is its year-round beauty and many recreational opportunities,” said Hornbeck. 

For those who love beaches and water sports, they can head to places like Benton Harbor, St. Joseph or Muskegon, just a few of the miles of beach property available. 

Despite Michigan not being near the ocean, its inhabitants are always within six miles from a body of water. Michigan boasts over 36,000 miles of streams, over 11,000 inland lakes, and is located next to four out of the five Great Lakes. 

This makes it a fisherman’s dream, with a variety of fish to catch. Michigan is also a wonderful place to hunt, having all kinds of prey, from ducks and water fowl to bear and elk. Plus, there are lots of places to go and things to see for nature lovers too, such as its seven national parks, three national forests, over 100 state parks or recreation areas and thousands of biking and hiking trails.

From the Arts to Golfing, Fun Awaits 

For those who prefer the indoors to the vastness of nature, Michigan is a cultural state. Several cities have museums, art galleries, ballets, musical symphonies and concerts, and various kinds of performing arts. These range from Detroit’s Institute of the Arts to Ann Arbor’s famous Art Fair and Saugatuck’s galleries, the population of retired artists and much more.

If you love golfing, then head to Traverse City, considered as one of the best golfing locations in the U.S. or venture over to Grand Blanc, which also has several great courses. In fact, there are over 800 public courses to choose from.

Cold Weather Can Be Fun for All

As seen on Bankrate, Michigan didn’t fare that well when it came to weather. The climate is considered humid-continental, which means it has four seasons with hot summers and cold, snowy winters, especially in the Upper Peninsula.

However, one person’s pain is another’s pleasure, and the snow and cold makes it a great state for winter fun like skiing, snowmobiling and, of course, making snowmen. Finishing it all with a cup of hot cocoa in front of a roaring fireplace, what could be more romantic?

Cost of Living Mostly Lower in Michigan

For those who want to save as much of their retirement dollars as they can, Michigan has a lower cost of living rate than many other states. According to statistics listed at michiganbusiness.org, for the last decade, Metro Detroit’s Consumer Price Index (CPI) has been below the national average.

Buying a house in San Jose, Calif. is more than 400 percent higher than in Grand Rapids, Mich. and more than 300 percent higher than buying a home in Lansing. Property taxes are assessed at 50 percent of a home’s assessed value. 

According to Zillow, the average cost of a home in Michigan statewide is $167,000, with values rising more than eight percent in the past year as of May 2017. Prices are expected to go up around 3.6 percent by 2018. Zillow quoted the average rental rate in the state at $1,095.

Michigan does, however, have one of the highest property tax rates in the U.S. According to WalletHub, as of May 2017, the state ranked 44th in property taxes, with a rate of an average of 1.78 percent. 

Michigan Income Tax Has Good, Bad Aspects

Michigan also has a flat personal income tax rate of only 4.25 percent and a sales tax of 6 percent. When it comes to income taxes, military retirees in the state can be happy to know Michigan doesn’t tax military pay; the state also doesn’t tax social security and railroad benefits. 

However, in 2011, Michigan passed a pension tax, which Hornbeck said AARP strongly opposes. 

“Michigan formerly was a state that did not tax pensions, an advantage enjoyed by retirees here for many years,” said Hornbeck. “AARP strongly opposed the tax, because it negatively impacts people on fixed incomes and retirement decisions had already been made by Michiganders based partly on the long-standing tax-free status of pensions. AARP continues to support legislation that would repeal the pension tax.”

Retirement Requires Preparation

All in all, retirement is a big decision that takes prior preparation and planning to do it right no matter where you decide to live, but Michigan is a smart choice. From its recreational offerings to its low cost of living rates, the Great Lakes State is a great place to live.

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