Before You Move to Avoid Income Taxes...

If you are thinking of moving to avoid state income taxes, know the following three things. And if any of this is helpful, tune into my new podcast, Your Money Guide on the side, by clicking the link in my bio. No. 1, do not let the tax tail wag the spending dog. Yes, Florida has no income tax, but home prices, insurance, and property taxes can eat up those tax savings immediately. One couple I know moved from Vermont to Florida, thinking they'd save a ton of money, but between hurricanes, repairs, and $5,000 plus annual insurance premiums, they're now spending more than they would have had they stayed in Vermont to live in Florida. Number two, state governments are gonna get their money somehow. Tennessee has no state income tax, but it has the second highest sales tax in the country. Texas, no income tax either, but property taxes average 1.58%, more than double Florida's. Number three, the biggest cost isn't always the one you see online. Online property tax estimates can be way off, especially if the home hasn't sold recently. Plus, many states wait to reassess home values until after they're sold to you. Bottom line, do not move for income tax savings alone. Run the numbers, do what works for you. All over on the podcast.