A t last—retirement. Time to kiss the kids and the lawn goodbye, and hop a one-way flight to Florida.

That's how it used to be. Baby boomers are bucking traditional notions of retirement. Two-thirds say they'll keep working, while others plan to volunteer, pursue a new business, a new career, or a college degree.

If you're among them, you'll retire wealthier, healthier, and earlier than any other generation, and you'll likely live longer. Taxes and living costs vary from state to state so where you live will be important on a fixed income. Here are a few things to consider.

Should I stay or go?
Tearing up roots and leaving family is hard to do, which is why 84% of people older than 55 choose to stay, according to a study by the Washington, D.C.-based American Association of Retired Persons (AARP). The farther you are from home, the more weddings and birthdays you'll miss and the less accessible you'll be to an aging parent or troubled child. Some seniors simply don't want to leave the bright lights of the city.

Many split the difference and retire to a favorite family vacation spot a few hours away or in a neighboring state, says Mark Calabria, senior economist with the National Association of Realtors, based in Chicago and Washington, D.C. "You get a change of scenery, yet you're just a short drive from family if you fall into ill health," he says.

What features should a retirement destination have?
Seniors want pretty much the same thing: to live tax free in a warm climate with cheap property, stunning vistas, world-class health care, and heaps to do—all of it close to shopping and the doctor's office.

College towns offer a nice array of amenities including libraries, museums, hospitals, theaters, bookstores, and coffee shops, as well as volunteer and job opportunities. Some state-funded colleges waive tuition for seniors and rental property often is cheap and plentiful.

For familiarity without the proximity, how about a naturally occurring retirement community, sometimes called a NORC. NORCs occur when people age where they live. They also develop when retirees from one state cluster in another. Midwesterners flock to Florida's Gulf Coast, for example, and Calabria knows of one block in Florida populated by retirees from Connecticut. Ask retired friends for suggestions.

On a fixed income, you should weigh the pros and cons of each destination carefully. Although Alaska, Wyoming, Florida, Washington, Nevada, South Dakota, and Texas have no state income tax, they may make up the shortfall elsewhere. Likewise, saving a few thousand dollars on a house in your dream destination is shortsighted if the cost of living is considerably higher than elsewhere.
    Once you've
    settled on a town,
    visit several times,
    at different
    times of
    the year.

Is an active adult community best for me?
Active adult communities like Sun City, Ariz., are great for active seniors who enjoy being with people of similar interests. The setting is secure, and someone else mows the lawn and cleans the pool. Social activities and recreation are built-in and on-site medical facilities and home offices often are available.

On the downside, singles may feel excluded by the "couples scene" and some communities have age restrictions. Also, you may become less active as you age.

Where will I get the best value for my money?
Florida, California, and Arizona still draw flocks of sun worshippers from out of state and will continue to do so. But the cost of living in the Sunshine State—Florida—is on the rise. Property prices in California have risen faster than mercury in the Mojave Desert and are among the highest in the country.

"Even cities like Sacramento and San Diego are becoming prohibitively expensive," says Calabria. Arizona has experienced so much growth, retirees are spilling into New Mexico.

Try a state where your shoestring stretches a little further, like Tennessee, the Carolinas, Oregon, or Georgia. States like Alabama and Arkansas also are beckoning to portfolio-packing seniors with cheap housing, low taxes, and recreation.

"Arkansas has some of the best fishing and hunting you can find anywhere. We have hiking and biking and beautiful scenery," says Carla Edwards, Arkansas retirement/tourism development manager. "You get a better bang for your buck with property here."

The pundits' pick for good all-around value is Las Vegas. "If you're not a big gambler, it's one of the cheapest places in the U.S. to live," says Calabria. Other advantages include a dry climate, night life, and a short drive to California and the Rocky Mountains.
    Central America
    in popularity

How can I look before I leap?
Use online newspapers to watch the classifieds for real estate. Once you've settled on a town, visit several times, at different times of the year. Bustling summer tourist spots can be desolate in winter—or delightfully private, depending on your perspective.

Experts recommend renting before you buy. You'll have time to find your dream home and see if the lifestyle and pace suit you.

Should I move abroad?
Two to three million retired Americans live abroad. The best deals, according to International Living, are in Central America where even a modest income buys a slice of paradise. The reason? Cheap property and tax incentives, mainly.

Political stability and a strong economy are the first things to look for in any retirement destination. And yet, upheaval in Ecuador—International Living's top pick for 1999—has brought property prices down: A new beachfront house sells for $40,000. Close behind are Mexico, Honduras, Canada, Nicaragua, Malta, Panama, Belize, and Hungary. Coastal land in Nicaragua can be had for a fraction of what it costs here; you can live like royalty in Costa Rica for less than $12,000 a year. But Belize takes first prize for its flexible retirement laws.

Bargains may come at the cost of other services, however. Hurricane Mitch wiped out roads and bridges in Honduras that have yet to be rebuilt.

Remember, emigration is not for the faint-hearted. "It's a culture shock," says Barbara Perriello, director of International Living's Discovery Tours. "People who fit in well are those who can be flexible." Discovery Tours are a great way to test the waters before diving in. You'll learn about the culture, view property, and meet helpful professionals who speak your language.

    Cost of living
    in the Sunshine
    is on the rise.
How important are health-care facilities?
The proximity of good doctors and hospitals will become more important as you age, as will the availability of assisted living and nursing-home care. The closer you are, the better. You don't want to drive an hour each way to visit an ailing spouse.

Most foreign health care is good and inexpensive. You won't be able to use Medicare abroad so you'll need private health insurance, although some countries allow residents to use state-funded health care. The U.S. Embassy in the country you're considering can provide information about visas, taxation, residency requirements, and property restrictions.

For more information
For state information and profiles, check out www.census.gov/statab/www/. Other useful resources: www.aarp.org; America's Best Places to Retire," edited by Richard Fox (ISBN 0964421623); and "50 Fabulous Places to Retire in America," by Ken Stern (ISBN 1564142604)

www.escapeartist.com lists tax havens, information about private health care and finances, and links to International Living and the Web sites of foreign embassies. Also see "The World's Top Retirement Havens," John Muir Publications (ISBN 1562613774)

© 2000 Credit Union National Association Inc.