Can you Retire in Delaware on Social Security?

Can you retire to Delaware on just Social Security alone? I get asked some version of this question almost weekly. And most of the people that are asking this question know that they're not going to get a simple yes or no. What they're really asking is, will I actually be okay? Will one bad month unravel everything that I've worked for? So that's the question that I'm actually going to answer today. Not the question of, is Delaware cheap? It's whether your Social Security check can actually cover your life living here in Delaware and not holding your breath every single time the phone rings. Okay, so here's what I'm hearing the most. What am I forgetting? Will my check actually cover my daily life? What happens if the HOA fee goes up? What happens if I need more medical care? Am I being unrealistic? And underneath all of that is typically a question that people do not like to ask out loud, which is, am I the only one who didn't save what we were supposed to save? You're not. Most retirees that are coming up towards retirement that maybe didn't save everything that they hoped they would have is not because they were careless. It's because life happens. It's because things get more expensive. It could be a variety of different things, a divorce, a layoff, an illness, your caretaking for your parents. And listen, that is not a character flaw. It's just what it looks like when real life happens. So if you have been comparing yourself to an imaginary retiree that has this amazing portfolio, I want you to set that aside for just a few minutes because truthfully it is not what I'm seeing in daily life and it is not what I'm seeing when I'm working with retirees. So why does this question feel so hard to answer? Can I live off of my social security check in Delaware? Part of the reason why that is so confusing and hard to answer is most likely because you've read 10 different articles. Some say Delaware is a retirement haven. Our tax benefits, our low property taxes, no sales tax. And then on the other hand, you'll read how Delaware's cost of living is creeping up and you'll look at a cost of living calculator and it'll pump out a number that doesn't look like anything that you could achieve. It's just so astronomical that no wonder you would never look at Delaware or any other state for that matter. And here is the honest truth, Delaware does have tax benefits for retirees. We have low property taxes and we have no sales tax. Those are all real, but taxes are only part of the picture for your retirement. A huge part of retirement is housing, medical, and also having a little bit extra to do those fun things that you've worked so hard for to get to retirement. And really what's standing in the way of you and a stable retirement are the little things that add up. Maybe an unexpected appliance breaks or you need a car repair, maybe a dental bill, or even the HOA goes up. So instead of asking, is Delaware affordable? Let's ask the real question, does my specific housing, my medical and anything in my safety margins actually equal my monthly check? So let's go over it. There are four different buckets that I want to go over today and you can grab a notepad and go over this, but don't you worry, I'll never leave you high and dry. I do have it below in the description, so go ahead and grab that and you can print it out and we can go through it together. All right, so let's talk about the first bucket, which is your guaranteed monthly income. So this is your social security after your Medicare has come out. This would also be any of your pensions, annuities, or your reliable part-time income. This way we're not taking a national average, we're going to look at the actual number that you are getting monthly. Bucket number two is your fixed essentials. So that's going to be your housing, your HOA, food, transportation, prescriptions, dental, vision, premiums, and any of your fixed monthly debt repayments. So any credit card debt or loans or anything else like that. These are the things that have to be paid no matter what. Bucket number three is your flexible lifestyle. So this is anything that you would want to do extra. So for example, if you want to go visit family, if you want to take a cruise, if you want to go backpacking through Europe, dining out, gifts, this is what actually makes retirement enjoyable, not just surviving, thriving. Bucket number four, and this is the one that everyone skips, and this is your shock margin. And what I mean by that is if your HOA goes up, if you get an unexpected medical bill, it's basically a little room for things that may happen that don't typically happen monthly. I want you to add all of those up and then we're going to start subtracting. So we're going to take your monthly income, we're going to subtract out your fixed essentials, and then we're going to see what's left over. A budget isn't stable just because your income equals your expenses. A budget with a zero balance leaves nothing for that shock margin that we just talked about because it works up until the week that it doesn't. And then you're in a very, very vulnerable and fragile position. And that is the last thing that I want to happen. And here's the one thing that changes everything. Your housing situation determines more than anything else, more than Delaware's tax reputation, more than the county that you pick, more than almost anything else. Let me show you what I mean by walking you through a few scenarios. Let's just say you are a single renter. Now, this one is a little harder with the math. Market rents tend to eat more of your social security check than anything else. Transportation, food, health care, I mean, anything else. Now, this doesn't mean it's impossible, it just means that the margins are very thin. And it usually means that you need help other places, whether that be subsidized housing, a roommate, or getting that part-time job that we just talked about. If you own your home free and clear, you're in a much better position. But paid off does not equal free because you still have those property taxes, you still have the utilities, and you still have maintenance items to keep up on. If you're a couple with shared expenses, this makes the math get a little bit easier. This is because a lot of your housing expenses are shared and not doubled. The one thing that I ask couples to look at first is what happens if one spouse passes away before the other one? I know that no one wants to think about it, but it is something that needs to be discussed. What happens if your significant other is no longer there? Do you get their pension? What situation would they be left in? Because ultimately, the income will change, but the fixed costs will not. And sometimes I have people bring up manufactured homes with land leases. And this is typically a lower upfront cost. A lot of times what we see is that your home value is actually less because of your lot rent. And lot rent is something that you will never get rid of. You essentially will rent the land that your home sits upon. And if you are in a park, you are at the discretion of the park owner. So if they decide that they would like to raise the lot rent every year, they do have that ability to do that. It is capped at 3%, but 3% can add up a lot for a retiree that is on a fixed income. Here are just a few things that I would like to put on your radar because they come up time and time again. Medicare helps enormously, but it is not free. You still have premiums, deductibles, prescriptions, dental, vision, all of that needs to be in your budget because while yes, Medicare helps a lot, it is not free and you still have those items that you will need to pay for. Also, moving further inland, yes, your housing will most likely be slightly cheaper, but are you making up for it in transportation? For example, if you would like to live in Newcastle County where we have tons and tons of healthcare, housing costs are actually more expensive in Newcastle County. Or you can live in Kent County, which is basically in the middle of the state and it's a little bit of both. So you do have access to healthcare, but you will be driving to it. And then Sussex County is our retiree haven where all of our retirees seem to be, which means that our healthcare is there, but if you need a specialist or if you're looking for certain things in the area, for example, like Costco, you are going to need to travel to Newcastle County in order to get there. Which brings me to the last point that all of Delaware is not just one uniform situation. So like I just described, depending on what you're looking for, you're going to want to add in the cost of transportation in the state. Now I'm not saying any of this to worry you, I'm just saying to take it into consideration. If you look at your ordinary Tuesday, which you've heard me say time and time again, if you've watched any of my previous videos, what does your ordinary Tuesday look like? Is it somewhere where you're going to want to kayak every morning? Is it where you're looking for walking trails or you would like to sit on the back porch and have a cup of coffee or your front porch? Are you someone that wants to get up and go to an exercise class with the girls or you would like to join a sewing club? There are so many different possibilities. You really need to decide what does your ordinary Tuesday look like and then start factoring that into your budget because it is not a one size fits all. I have seen so many people with different backgrounds. I've seen woodworking. I've seen people that want to be part of the walking club. I've seen others who are like, hey, we don't want to be in an HOA. We don't want to be in a community. I'm not looking for amenities. I just want a single family home, ranch style home on a plot of land and I just want to live out my retirement by myself, unbothered by other people. I mean there are so many different ways and avenues that you can go and Delaware really does offer it all, but like I said, it really depends on where you're choosing to live in the state on how much your transportation is going to be, your access to healthcare, how much your housing is going to be, and they are all parts of your social security check that you need to take into consideration and I want to be very clear. You are not going to leave this video with a clear answer. Like I just said, you need to write down everything that we just talked about and I have that below in the description. Don't worry. I made sure that I wrote it all out for you. You can print it out and we can go over it. We can kind of discuss like what does your typical Tuesday look like? Does your social security check cover everything that you're looking to do in retirement? The one thing I know that you will leave this video with is the sense of being able to figure out what you're actually looking for. If someone tells you that they are going to give you every single number and you will leave knowing exactly what your plan is and exactly where you need to be, they're lying to you. It really depends on your particular situation. Listen, here's what I want you to do. I want you to go down below in the description. I want you to print out the guide that we just talked about. I also have the true cost of retiring to Delaware is packed full of information and real numbers. I tried to think of every single number and thing that you would need to know before retiring to Delaware because a lot of people don't know about that 4% transfer tax in Delaware. They don't know about the 5.25% Kelley Blue Book value of your vehicle, which is a document fee when you transfer your vehicle over to Delaware. These are all real numbers that need to be put in your budget, especially if you are living off of social security. So that is also below in the description. I really hope this video helped. I hope that you came into this video wondering if you could afford Delaware with your social security check and I hope that you are leaving with the answer. If not, what you need to do to get there. If you are interested in retiring to Delaware, I would absolutely love the opportunity to help you. My information is down below in the description, so feel free to send me an email or text me or call me or we can set up a video call. Once again, I really hope that this video helped. If it did, be sure to give me a thumbs up. Be sure to subscribe to the channel and I will see you on next week's video. Hey, if you were thinking about retiring to Delaware, I would absolutely love for you to check out this video right here. And if you would love to see more Delaware 55 plus homes, check out this playlist right here. And don't forget, subscribe to my channel.