The True Cost of RETIRING in California: What You Need To Know

[@nathanielcarreon5634]

Housing is relatively affordable in CA if you bought several decades ago.

[@julies634]

Perfect timing! I’m recently retired this year, my husband is already retired, and we were considering selling in our house in the Central Valley and moving to Tennessee or North Carolina or somewhere. Had not even considered the other issues such as community property or Medi-Cal. You given us food for thought, thank you!

[@CunninghamLegal]

I'm happy to hear that! Congratulations on retirement and thank you for leaving a comment.

[@ldarmiento7098]

Suggestion: Dont make e move just yet. I'd spend three months in your future destination first.

[@EBMB21]

I bought my 1900 sq ft house some 30 years ago…..property tax is around $3,500/yr and now worth $1M plus. My property tax was $4,200.00, 30 years plus later, it went down by about $1k. If I sell and buy another home during my retirement, will I be paying property tax the same calculation as my current? I’m retired but cash poor. Most of my $ is tied on my house. What would you advise me?

[@CunninghamLegal]

It may be possible to transfer your low prop 13 tax base to a new property. If you buy a property in California that is not more expensive than the current property that you are in your taxes stay the same. We have content on this on other videos that I would encourage you to check out. When you're ready to seek advice, feel free to reach out to us if you are not already represented by other counsel. www.cunninghamlegal.com/california-law-offices/contact/

[@nz6241]

That's why you don't retire in California. Especially if you are in the HNWI or higher class, get out and go to state or Country that has significantly lower cost of living. The state is Beautiful but the masses who live in the state that don't care about society and don't' abide by the law is increasing.

[@dirtrider9268]

And yet crime is still lower n California than when I lived there in the 70s and 80s.

[@ronakpatel9023]

weather is crap everywhere else.

[@woodturner1954]

70 now, retired at 59 in California in 2013 with a 35 yr Federal Government Pension, $600K investment (IRA, Roth), house bought in 84' for $65K now worth about $300K. You keep taking about multi millions, that's not me and probably not 95% of those watching. What are the numbers for us? Never married, no kids, but I want to leave everything to 3 nieces and a nephew.

[@CunninghamLegal]

It sounds like you have successfully retired in California. Congratulations! While we aren't sure what numbers you're referring to, a Revocable Living Trusts centered estate plan is likely a great option for you. If you don't already have a lawyer to help you with this, feel free to reach out to us: www.cunninghamlegal.com/california-law-offices/contact/

[@sw6118]

Interesting presentation. It begs the question: what you need to know when you move your parents (and their assets) to somewhere else or across state lines to be near you, you calculate financial impact on (1) your parent and (2) on you. (And then dealing with the spreading the fairness aspect when you have siblings.)

[@CunninghamLegal]

Thank you for your comment. I personally experienced this with my in-laws when they moved from California to Arizona … then back to California, for a variety of reasons. California has extremely generous laws when it comes to public assistance benefits and that can be a big financial help for the family - parents and children.

[@MichelleKotler]

I was just in San Diego. Rent for a 3 bedroom apartment is $5000+/month and gas is $6/gallon. A “reasonably priced” 2 br/2 bath 55+ condo is $675,000. No thanks!

[@CunninghamLegal]

Yes, San Diego can be an expensive California city. The good news is, California is a large state, so there are more affordable places to live (although San Diego's warm climate, beaches, and many attractions make it a hard decision).

[@cherlgolja5402]

It’s working for me ! My house is paid for I have no debt! I’m 73 lived in Northern California 🍷for over 45 years , I’ve lived all over this beautiful country nothing is as beautiful as California!!!!😊🇺🇸 Hate the politics! However there are more republicans here then people know 🇺🇸vote !!!!🇺🇸

[@zombieapocalypse3837]

There is 5 millionish registered Republicans, but there are 10 millionish registered Democrats that determine elections.

[@CunninghamLegal]

That's great! Thank you for sharing.

[@larrybarnes5020]

Live California, vote BLUE

[@facemakerable]

best weather !

[@CunninghamLegal]

Agreed!

[@fremontpathfinder8463]

I have lived in California all my life. Have traveled out of the area but would prefer to only live on the west coast. I have transferred my teaching credentials to Oregon, Washington and British Columbia. I bought a modest house in the Antelope Valley at 55 years of age 6 years ago. Yes the protection of property taxes in California is why I don't want to sell my house even though I might want to move to Washington. Trying to figure it all out right now. I do want to move to WA because my pension will not have a state income tax in WA. That could save me quite a bit. I am hoping the Senate does away with the Windfall provision of the Social Security Act since I worked for 17 years as a vet tech before teaching. Because my assets won't be near 2 million dollars I don't think the death tax would affect me. People like to bash California but there are many great aspects of living here. Good information. Thanks so much.

[@jeangreen432]

Treasury bills, notes and bonds are free from state income tax as well. Thanks for the info!

[@lubentodorovski4449]

I wasn’t born in California. I moved back to San Francisco more than 2 years ago working from home and retired this June. I was pleasantly surprised how much of house I can afford and how easier is to find parking than 15 years ago. The city has been mismanaged but it is still beautiful and fun. It looks like it is improving but still way to go.

[@Rhaspun]

I live in the South Bay. I worked in the Silicon Valley area and I've been retired for the past few years now. No intentions of moving out of California. The only other place I've been looking to move to is the San Diego area. I like the mild winters they have. I went to college at SDSU. I have time to look around the San Diego area so I'm not in a hurry. I even thought about buying a house that needs a lot of upgrading but I would just tear it down and rebuild.

[@narendraswamy4649]

In the Abel and Baker example what happnes to the NJ rental income? renting for free? Is the house in the LLC or in their name?

[@CunninghamLegal]

Great question @narendraswamy4649.The property would be rented and rent collected, which rent is reportable on Able and Baker’s Form 1040, Schedule E. In this example, the property is not in an LLC in this example and remains in Able and Baker’s names.

[@narendraswamy4649]

@@CunninghamLegal Consquently impact their 401k withdrawal amount to fill that tax bracket. Understood.. Thanks.

[@narendraswamy4649]

All what’s the benefit of that llc for equity holdings

[@CunninghamLegal]

@@narendraswamy4649 Some institutions prohibit a U.S. citizen who is no longer a U.S. resident from maintaining in their own name a U.S. brokerage account. These institutions often have policies that restrict non-U.S. residents from holding accounts due to regulatory, compliance, and operational concerns. Some people use a U.S. LLC to hold the brokerage account and name a U.S. resident as manager of the LLC. An alternative structure would be use of a trust.

[@3Ottavia]

My property tax in Kern County has doubled since I purchased my house 20 years ago. Taxes ARE a big deal.

[@CunninghamLegal]

Absolutely!

[@dirtrider9268]

Your home value doubled also, right? Guess where else property values and resulting property taxes increased, everywhere.

[@katiefranklin6013]

What was the law that was referred to that is going to “sunset”.? Thanks for all the information btw!!

[@CunninghamLegal]

Hi, there are two laws that are set to sunset soon that concern estate planning, and we've done videos on both: 1. 2026 Estate Tax Exemption Sunset: www.cunninghamlegal.com/2026-estate-tax-exemption-sunset-opportunities-and-risks-for-your-estate-plan/ 2. Expiration of the 2017 Tax Cuts and Jobs Act: www.cunninghamlegal.com/how-to-prepare-for-the-expiration-of-the-2017-tax-cuts-and-jobs-act/

[@jaunt3603]

We left Long Beach California for Boise in 2021. My wife was stalked twice in a year walking our dog near our old apartment. We bought a 4 bedroom, 3 car garage for 467k, that would probably get us a 2 bedroom condo in a just okay area. It came down to cost of living and quality of life for us. We recently went to California for vacation and met an older lady who lived in Morro Bay. She said her property taxes were 8k a year and are going up. We were flabbergasted as we pay 1400 a year. Boise is a super clean city, very little homeless and safe. We're feel like we're getting good value for our taxes. I calculate because of the savings by living here I'll be able to retire 10 years early at 55; five years to go.

[@CunninghamLegal]

California certainly isn't for everyone, so I'm glad you were able to do what was best for you and your wife. Thanks for leaving a comment! If you had a California estate plan, be sure to take it to an attorney in Idaho so they can review it for any state-specific issues.

[@ahmadghanem2414]

I hear that Idaho is a very racist state towards Californians . They don’t want us there

[@dirtrider9268]

How's your weather, that stuff you are immersed in 24/7? California is expensive for many reasons, and had you owned a home there for 20 years, you would have been able to retire already and paid cash for a home elsewhere...

[@jaunt3603]

@@dirtrider9268 We do have 4 proper seasons with very mild winters. This year we did get smoke from the fires and was the worst since we've been here. Last year was amazing. You can't beat southern California weather. I actually get to do more outdoor activities here though because: 1. How close everything is (15 to 20 minutes). I have the greenbelt, 27 miles of paved trail that we go biking on. The foothills for mountain biking. In summer time it doesn't get dark until 9:30. I'll go mountain biking right after work and its only 20 minutes away. 2. My favorite NP is Yosemite and was 5 hours from me when we lived in California, We now go to Yellowstone 1x every other year. Just as good. 3. We have amazing state parks and wilderness areas: Stanley, Salmon and Coeur D'Alene. First two are a couple of hours away. 4. Less people and less traffic. No fighting people to do things. 5. Wife loves wine tasting. We have the Sunny Slope wine region only 20 minutes away with world class wines. No place is perfect though. We never bought in California. We could have afforded a house but we would have to pay more than twice to get what we have here. It's very safe here. People still leave their bikes out and they dont get stolen. Both me and my wife had our bikes stolen in Long Beach.

[@dirtrider9268]

@jaunt3603 if your lifestyle there is half the price of So Cal, you are overpaying. Taxes are a %, they go up with property values. Your perception and anecdotes are not representative of anything that matters, and you'd be outnumbered but that is why you go there. Yellowstone is not the same as Yosemite, besides the title of Natl Park, such a weir comparisons. Those leaving California are generally lower income and lower education so we understand why you leave. We'll welcome you back each winter.

[@MinnieFarnsworth]

The government does not print money. Quite shocking that you made that claim.

[@dirtrider9268]

These anti-Gov claims are really dissapointing. Old cynical rants that have no place in a intelligent discussion by affluent attorneys or pilots, both endeavors who benefitted greatly by the federal policies and infrastructure the US government workers built. The greed we see like creating LLCs to dodge taxation on huge investment portfolios is just disturbing human greed. This great country resulted from the great governing of programs that created the biggest middle class and deserving of great respect. But greed of the wealthy has declined the prior middle and lower class benefits over the past 40 years. But sure the wealthy need another federal tax break and more loopholes to finally make them happy.

[@CunninghamLegal]

Our research indicates that the Federal Government does, in fact, print money. The Bureau of Engraving and Printing (BEP), a part of the U.S. Department of the Treasury prints at a BEP facility in Washington, D.C. and at a facility in Fort Worth, Texas.

[@winterheat]

why do people make it so torturing to live? And then have "strategies"? Are they playing themselves?

[@rickbarrington]

Came to this video thanks to Yt algorithm. You have some good stuff but gee it takes 7 minutes before you first start talking about the subject! Start with a tight agenda, keep it focused, use real examples and avoid rambling! 🙏

[@CunninghamLegal]

Sorry about that. Thanks for the tip!

[@jimbrown4640]

Don't retire in California unless you are rich and like paying high taxes.

[@TrustVictim-f6y]

California will be the first state to get Notary Index Crime Enforcement Regulatory 837PC Citizens and Sheriffs on call to arrest Interdiction Trust warned, Permission Ledger monitored, and NICER exposed Trust Forgers.

[@Mattxwill1]

Thes guys talking about 5 million and 10 million portfolios like its totally normal.

[@CunninghamLegal]

We handle a range of clients, so for us, it is normal. Sometimes, for advanced planning, we focus on those with $5M to $10M in investment accounts and total assets. Other times, we just do foundational estate planning- often for clients with less than those figures.

[@Mattxwill1]

@@CunninghamLegal I applaud your success. But a "net worth of $5 million or more, places a person within the top 1% of wealthiest households in the country." Your examples are hence for an extremely limited audience to begin with, certainly much smaller given the typical You tuber demographics. SO sure, I wanted to know the true cost of retiring in CA but tuned out when you nonchalantly used a $10,000,000 property sale as your scenario. I find that hilarious. You couldn't use a more realistic example? 🤣

[@CunninghamLegal]

@@Mattxwill1 Thank you for your comment. We do have other examples in other videos with smaller numbers. One advantage of using larger numbers is that we have a “graduated” tax structure. Put simply, the math is easier to understand with the larger numbers. The point of these videos is to teach key concepts rather than nuts-and-bolts math!

[@TheK9Shepherd]

Regarding community property. My folks live in VT. Are you saying that when one of them dies, the house will get 50% cost basis adjustment to FMV? So that's not bad if she goes to sell. However, let's say father passes away, then mother in 5 years (but never sells) Does that mean when the house is passed down, the cost basis for the heirs is no longer FMV of 100% of the house but just 50% (since my mother already got a 50% cost basis increase?) I am really hoping that I totally misunderstood the community property part of your video :-)

[@CunninghamLegal]

Please note that CunninghamLegal is a California based estate planning law firm. In non-community property states, assuming spouses own the property 50/50, when one spouse dies the property gets a 50% adjusted cost basis. When mom dies, the other half gets an adjusted cost basis. This assumes the property is included in the decedent’s respective gross estate under Federal Law at each death. In a community property state, assuming title is deemed to be community property, on the death of one spouse, the property receives a full adjusted cost basis. On the death of the surviving spouse, the property again receives a full adjusted cost basis. *this is information only- not legal advice*

[@TheK9Shepherd]

@@CunninghamLegal Great explanation !! Thanks for clearing my confusion. Luckily in VT, property taxes are not adjusted when one or both spouses passes away. The tax rate is the same and only is adjusted every 10 years when the town's do a reassessment. Even then, it's revenue neutral. Thanks again !

[@dirtrider9268]

When you build your own wealth, from the great start your parents already gave you, the gift of inheritance just doesn't matter much.