The traditional retirement migration might not be as good as you think, according to recent research.
The findings: Many people look forward to moving when they retire, but a new study suggests you’re likely to be happier in retirement if you don’t move. Older people, in particular, are happier when they stay in their communities.
The research: More than 84,000 retirees moved to Florida in 2016, the most recent year for which data is available, lured by the presence of balmy ocean breezes and the absence of personal income taxes. But a recent National Bureau of Economic Research working paper suggests they might be happier if they’d stayed put.
Overall, older people tend to be happier than younger folks. On average, over-60s have both more tangible and more intangible resources—they’re wealthier and more emotionally resilient. But another reason they may be happier is that they tend to have stronger ties to their communities, because they’ve lived there longer.
Moreover, living in the same community for a long time—a decade or more—brings even greater happiness to older people than it does to younger people. As the researchers put it, for all people, “the effects of community belonging are... large and strongly significant,” but “become greatest at very high ages,” namely over the age of 75.
Researchers John F. Helliwell, Max B. Norton, Haifang Huang, and Shun Wang explain why:
“The greater impact of community belonging for those of greater ages may reflect changing patterns of life, with less time on the job and more in community settings. Those in the oldest age groups are also more likely than those in younger groups to be living alone, whether through divorce or widowhood. This lower prevalence of supportive networks on the job or at home thus may be what elevates the relative importance of the community as a source of social engagement and support.”
The upshot? No matter how much you may save in taxes by moving to a low- or no-tax state, consider that it may take 10 or more years for you to feel like you truly belong.
The caveat: The data in this part of the NBER paper comes from Canada and Denmark. While the findings seem applicable, there’s always the possibility that retired Canadians and Danes who move are less happy than their American counterparts. Perhaps Key Largo is full of happier retirees than Calgary or, say, Klitmøller (a.k.a. “Cold Hawaii”).