For many retirees, the idea of heading to a new area to enjoy their golden years is enticing. However, figuring out where to go can be shockingly difficult. After all, every state has something unique to offer. Plus, it comes with different benefits and drawbacks, each of which needs to be assessed. If you’re thinking about heading to Oregon to retire, it’s important to look at the details. With that in mind, here’s what you need to know if you want to retire well in Oregon.
Cost of Living
Taking a look at a state’s cost of living scores is a wise decision. It allows retirees to assess the overall affordability of a state, something that might be particularly important for low- to moderate-income retirees who don’t want to strain the budgets.
Understanding cost of living scores is pretty easy. The national average always sits at 100, keeping it consistent. If a state’s scores are below 100, that means it costs less than the national average. If a score is above 100, it’s more expensive.
Oregon isn’t known for its affordability. The Beaver State’s overall score comes in at 134.6, making it one of the most expensive states in the nation.
When it comes to category scores, Oregon only has one that falls below 100. The Beaver State’s utilities score is just 87.5, which is notably low.
However, for groceries, Oregon comes in at 113.8. As for transportation and healthcare, the scores are 129.4 and 117.2, respectively.
Housing is also quite expensive in Oregon. For that category, the state receives a score of 184.8. While by no means the highest in the country, it is far above many other states.
When you’re trying to pick a state for your retirement, factoring in the cost of taxes is a smart move. Since paying taxes on some level is unavoidable, tax rates can have a substantial impact on your quality of life.
If a significant amount of your retirement income has to go to paying state-level taxes, you’ll have less to spend on living expenses, recreation, medical costs, and more. This can be a big concern for seniors on tight budgets but shouldn’t be ignored by retirees with large retirement accounts either.
Oregon does have a state income tax. The Beaver State uses a bracketed system, with rates ranging from 0 to 9.9 percent, depending on income level.
Now, retirees do get a bit of a reprieve. Social Security retirement income isn’t subject to Oregon state income taxes, effectively shielding part of your money from taxation. Additionally, public and private pensions are only partially taxed if your income is below a certain level. Low-income seniors are eligible for a tax credit that can reduce the effective tax rate on pensions.
However, retirement account withdrawals – such as money from an IRA or 401(k) – are fully taxed. There are not offsetting credits or exemptions for this income category.
It is important to note that Oregon does not have a state sales tax. This can make higher income taxes feel more manageable, as you can shop without having to worry about paying more than the cost of the item.
Additionally, the Beaver State’s property tax rates are close to the national average. Seniors may also qualify for a property tax deferral program. If your household income is at or below $46,500 (for 2021), your net worth is below $500,000, and you meet other qualifications, you could be eligible for the program.
Part-Time Job Opportunities
Many seniors don’t plan on completely leaving the workforce when they initially retire. Instead, they decide to get a part-time job.
At times, part-time employment serves as a way to stay busy or to keep using skills they enjoy. For others, it may be a way to make retirement savings last longer or even stash some extra cash away for later in life.
Generally speaking, part-time job opportunities are reasonably available in Oregon. However, like many other areas, the Beaver State did experience some challenges during the COVID-19 pandemic, some of which continue today.
In the early days of the pandemic, the unemployment rate shifted from 3.5 percent in March 2020 to 14.9 percent in April 2020. That shift was slightly more dramatic than the national averages for those months, which were 4.4 percent and 14.7 percent, respectively.
Oregon is now in recovery. As of November 2020, the unemployment rate had shifted down to about 6.0 percent. That was lower than the national average during that month, which came in at 6.7 percent. However, it’s still far from its pre-pandemic levels. Plus, COVID-19 is still an issue in much of the country, so it isn’t possible to entirely anticipate how unemployment levels will shift in the coming months.
If you intend to retire in Oregon soon, it may be wise to initially plan on relying on retirement savings for income. While you may be able to secure a part-time job quickly, the situation is a bit fluid, so it could take more time than it would have pre-pandemic. By accounting for that, you can make sure your first years as a retiree aren’t unnecessarily difficult.
Retirement Apps to Use in Oregon
|App||Fees and Minimum||Best for:|
|Betterment||0.25% per year|
no account minimum
|Saving for retirement|
|Ellevest||$1-$9 per month|
no account minimum
|Retirement especially for women|
|Personal Capital||Free||Planning retirement|
Best Cities for Retirees in Oregon
The quality of your retirement can, at least partially, depend on the city you choose. Not only can this impact the cost of living, as it does vary from one city to the next, but it also affects your ability to access certain amenities, medical care, and recreational opportunities. Together, that all plays a role in your quality of life during retirement.
While any city may potentially meet your unique needs, if you aren’t overly familiar with Oregon, it can be hard to determine where you should start your search. Luckily, a few cities in the Beaver State stand out from the others, making them worth considering.
Roseburg can be an excellent town for retirees. It sits in the Umpqua River Valley region of the state, making it a great spot for seniors who enjoy outdoor adventures. It’s near Crater Lake, fly fishing opportunities, and hiking trails, giving you plenty of options. Additionally, for a smaller town, it has plenty of amenities. Finally, home prices tend to be lower in Roseburg, which is a nice bonus.
If you want to be close to the California border, then consider heading to Brookings. Originally a logging town, Brookings maintains a quaint feel but also has a fun vibe thanks to the various festivals and art events the city hosts during the year. It’s a peaceful town that’s near beaches and forests. Also, it’s a bit more temperate than some other options.
Adventurous retirees may enjoy Hood River. It sits in the Columbia River Gorge region and is known for offering some of the best windsurfing in the world. Plus, it’s not far from Mount Hood, which offers up exceptional hiking opportunities, and is home to multiple festivals during the year. Finally, Hood River has all of your main amenities covered, including access to excellent healthcare.
How Much Money You Need to Retire Well in Oregon
The amount of money you need to retire well in any particular state can differ from how much you’ll need in others. Overall, the cost of living is on the higher side in Oregon. As a result, you need access to more cash if you’re going to retire comfortably there.
Whether you’re relying solely on retirement savings or are also working a part-time job to make ends meet, having access to around $85,133 a year is where you may want to aim. With that amount, you can cover all of your needs along with a reasonable number of wants, increasing the odds that you can retire well in Oregon and enjoy your golden years.
Do you have any additional tips that could help seniors retire well in Oregon? Share your thoughts in the comments below.
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