My wife and I could sell our home in California, pay cash for a home in another state, and never make another mortgage payment again.
But we're not going anywhere. And the reason we're staying is the same reason that stops a lot of seniors from leaving.
I'm Casey Bogle, a Southern California realtor who specializes in 55+ communities in Corona. Many seniors face the same decision my wife and I did: sell and move somewhere more affordable, or stay in California and find another way to make it work. It's a decision that can pull you in two directions. The financial side often says go. But when your adult kids and grandkids live here, that changes everything.
The Financial Case for Leaving California
Let's start with the money, because this is where the difference really shows up.
Many California seniors have owned their homes for 20 or 30 years and are sitting on a lot of equity. In many parts of the state, it isn't unusual for a home's value to top $1 million.
If you sell and buy a similar home in a lower-cost state, you can often pay cash. That means no more mortgage payment, and possibly money left over for retirement. Some states, like Texas and Tennessee, also have no state income tax. There's no denying that this can make your retirement savings go much further.
Mortgage rates are another piece of the puzzle. With rates around 7%, financing your next home can mean a hefty monthly payment. But if you pay cash for a home in a lower-cost state, today's rates don't affect you at all.
This strategy is often called the equity swap, and on paper, it can look like a no-brainer.
The Money Mistake Many Seniors Make
Many people compare home prices and income taxes and stop there. But that doesn't give you the whole picture.
- Property taxes: If you've owned your home for a long time, Proposition 13 has probably kept your property taxes very low. In some states, including Texas, property taxes are actually higher than in California.
- Homeowners insurance: Insurance can be expensive in other states too, so don't assume you'll save there.
- Social Security: California doesn't tax Social Security benefits. If Social Security is a big part of your retirement income, your savings from moving to a no-income-tax state may be smaller than you expect.
I'm not saying leaving California is a bad idea. I'm saying you need to look at your own numbers. Everyone's situation is different, and what works for someone else may not work for you.
Why My Wife and I Are Staying
The reason we're staying is the same one I hear from many seniors: we want to be close to our kids and grandkids.
Even when the numbers say it's time to go, your heart can say something completely different. You can't put a price tag on Sunday dinners with your family, sitting in the audience at a school play, or getting a call asking if you can pick up a grandchild who's sick at school. Those moments happen every week, and they don't wait for your next visit.
We've taken a hard look at the numbers, and there's no doubt we'd be better off financially if we left California. But we can't imagine watching our grandkids grow up over FaceTime or through photos. We like being around our family and helping out however we can. It may sound corny, but we get together with our kids and grandkids every other Sunday for family dinner night.
I know from talking with other seniors that many of them feel the same way, and it's kept a lot of us from leaving California.
4 Options When the Money Says Go but Your Heart Says Stay
The good news is that you have options. Here are four I see seniors using.
1. Move, but Set Up a Travel Fund
If you decide to move out of state, set aside part of your equity specifically for family visits. With some planning and an eye out for airfare deals, flying back six to eight times a year is very realistic. You can also fly your kids and grandkids out to visit you.
Best for: people who are healthy, enjoy traveling, and have family who are good at planning ahead.
2. The "Pioneer Move"
With this approach, you move out of state first, and your adult kids and grandkids follow a year or two later.
To be fair, this one is hard to pull off. Your kids likely have jobs and careers here, so it depends on whether they can find work in another state. It's less common, but I have seen some families make it work.
3. Downsize and Stay
This is the option my wife and I chose. Our plan was to sell our larger two-story family home, pay off as much debt as possible, and move into a smaller, less expensive single-story home that was still close to our family.
We found a 55+ community here in Corona that puts us about 45 minutes from our kids. Traffic can make it longer, but so far it's working well.
If you go this route, look into whether Proposition 19 applies to you. It's one of the biggest cost-saving programs available to seniors. If you're 55 or older, Prop 19 lets you transfer your low property tax base to a new home anywhere in California, up to three times. There are rules about timing and price, so check with your tax advisor. But the idea is simple: you can downsize, free up cash, and keep your lower property taxes, all while staying within driving distance of your grandkids.
4. Stay in California, but Move Farther Out
This is the option many people overlook. The Inland Empire has several 55+ communities that cost significantly less than homes in Orange County and Los Angeles County, and many are still within an hour to an hour and a half of family.
Communities in Beaumont, Hemet, and the Palm Springs area offer some very nice, more affordable options. Many seniors sell their large family homes in LA or Orange County and pay cash for a home in the Inland Empire, which is much like the equity swap people are looking for when they consider leaving the state. And because you're staying in California, Prop 19 still applies.
For many buyers, this ends up being the sweet spot. You get more home for your money, you can often eliminate your mortgage completely, and you're close enough to make it to your grandkid's soccer game on a Saturday morning.
So, Should Seniors Leave California?
For some people, the answer really is yes. California has become a very expensive place to live, and if your finances don't let you do the things you enjoy, moving out of state can make a lot of sense.
Whatever you decide, look at the real numbers first, and weigh them against what matters most to you.
Let's Talk Through Your Options
If you're trying to decide whether to stay in California, downsize, or move somewhere more affordable, I'd be happy to walk you through it, with no pressure. Call or text me directly. It's my personal cell, and if I miss your call, I'll get back to you right away.
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