The Retirement Mensch has relocated from New Jersey to South Carolina where the living is easy, the humidity high and the taxes low. There are some big differences between South Carolina and New Jersey when it comes to taxes and expenses.
In New Jersey, there is no tax on clothing or apparel. Your shoes, socks, jeans, tee shirts, etc. all go through the check out line without being taxed. In New Jersey there is no tax on groceries. Your steaks, pickles, tomatoes, etc. are all tax-free, but non-food items like paper products, soap products, and light bulbs have 7% added on. In South Carolina, everything that is in your grocery cart is taxed. Doesn’t matter if it is bacon, tomatoes or a swifter mop on the checkout belt, it is taxed at 6%.
South Carolina has a 6% personal property tax on automobiles, boats, motorcycles, etc. There is a “white” tax on appliances that is levied by the counties for environmental reasons. Both of those taxes are unheard of in New Jersey.
I know I said taxes are lower in South Carolina, I forgot to mention that there are more of them. But even with the nickel and diming of various taxes, there are big savings here.
As a retired Mensch, my health insurance is Medicare A and B along with AARP’s Supplemental Health Plan. In South Carolina, the premium for the supplemental plan is $100 less per month for Mrs. Mensch and me. That’s a savings of $1200 a year. I could buy $17000 of groceries and still be even with NJ.
If you are in Medicare you know that a Part D prescription plan is required. The Mensch’s Medco Medicare Prescription Plan has a higher premium in South Carolina than New Jersey: $36.80 versus $34.40. ( Medco’s highest monthly premium is $49.40 in Florida; the lowest is $30.70 in Arkansas.)
Compared to New Jersey, homeowner’s insurance is less in South Carolina but not by much with both states facing hurricane exposure. AARP has South Carolina ranked 41st in automobile insurance premiums and New Jersey is 22nd in 2010. How much could it change in two years?
The big difference is property taxes. New Jersey has the highest property taxes in the country with little relief for retirees. New York is actually higher but has better relief for seniors. On comparably valued property, real estate taxes in South Carolina are about 30% of New Jersey with homestead and senior citizen relief that can bring it down to about 20%. Average property taxes in New Jersey are about $7500. In South Carolina, it is about $2500. One source has South Carolina as 44th in property taxes compared New Jersey’s #2.
As long as my disposable income matches the humidity, I’ll be a happy Retired Mensch.