Wouldn’t it be nice to have sunshine and warm temperatures all year? Like many people, you may be weighing the idea of trading your snow boots for flip-flops – either part of the year or full-time.

Snowbirding is a popular way to enjoy warm climates during winter months while maintaining ties to a primary residence in another climate. Permanent relocation is also an attractive option, but doing so may be daunting, especially for people who are deeply rooted in their community.

Before committing to the snowbird lifestyle or permanent relocation, consider evaluating personal preferences and financial capabilities. Here are some tips to help you make the right decision for you and your family:

First, Set Goals

Being clear about what you want can help you narrow the many choices you have when it comes to deciding where and how to live. Consider making two lists – one for “wants” and the other for “needs.” For example, you may want to live near the beach, but you may need to be near an airport or a medical facility. Rank your list in order of importance.

Next, Visit Your Desired Location

Justin Smith, a Savant financial advisor who relocated from the Midwest to Arizona, emphasizes the importance of taking multiple “test drives” to potential new locations. “Be sure to look at multiple neighborhoods/areas, spend a few weeks at a time, and visit during different seasons to really get a feel for what you like best,” he says.

If you are considering a permanent relocation, try to determine your sense of belonging in a new location. Wayne Titus, managing director of Savant’s Michigan office, advises establishing routines and engaging in local activities to facilitate social connections. Titus suggests, “Get involved in a routine as quickly as possible upon arrival (exercise or other group or hobby) so you can begin to establish some acquaintances. Remember, you are laying the groundwork for longer-term involvement in the community.”

Last, Understand the Costs

One of the biggest mistakes people make when deciding where to live is overlooking the intricacies of taxation. According to Savant advisor Will Gunlicks in Lincolnshire, IL, “It’s common for people to think they will save on taxes by moving without understanding the specific tax breakdown.” Gunlicks notes, “For example, moving to a state that does not have state income tax from a state that does, doesn’t always result in lower taxes because they are often not earning income.”

Failing to account for hidden costs can also derail financial plans. “One of the most common hidden costs is homeowners insurance in states affected by hurricanes.” Gunlicks emphasizes, “It’s really important to factor this cost into a potential move to someplace like Florida.”

Kevin McFadden, a Savant financial advisor in Rockford, suggests not rushing into homeownership. “I recommend not purchasing a home right away,” he says. “Take time to travel around and visit different locations.” McFadden adds, “If a home really stands out to you, then start looking into opportunities to purchase.”

Deciding between the snowbird lifestyle and permanent relocation involves weighing various factors, including lifestyle preferences, financial considerations, and community integration. By addressing common challenges and following a systematic approach, you can make informed decisions that align with your goals and aspirations.

About Savant Wealth Management

Savant Wealth Management is a leading independent, nationally recognized, fee-only firm serving clients for over 30 years. As a trusted advisor, Savant Wealth Management offers investment management, financial planning, retirement plan and family office services to financially established individuals and institutions. Savant also offers corporate accounting, tax preparation, payroll and consulting through its affiliate, Savant Tax & Consulting.

©2024 Savant Capital, LLC dba Savant Wealth Management. All rights reserved.

Savant Wealth Management (“Savant”) is an SEC registered investment adviser headquartered in Rockford, Illinois. Past performance may not be indicative of future results. Different types of investments involve varying degrees of risk. Therefore, it should not be assumed that future performance of any specific investment or investment strategy, including the investments and/or investment strategies recommended and/or undertaken by Savant, or any non-investment related services, will be profitable, equal any historical performance levels, be suitable for your portfolio or individual situation, or prove successful. Please see our Important Disclosures.