The One Social Security Question You Must Ask Before Relocating In Retirement

There may come a point during your retirement when you start to contemplate a move to another state. Maybe you retired in the northern part of the U.S., only now, the winters are starting to get to you. Or maybe you fled to a warmer climate, only to miss your grown kids and grandchildren who live 500 miles away.

You may even decide to relocate as a retiree to get a change of scenery or get closer to more amenities. If you're in a more suburban area, for example, you may decide to move to a city so you can enjoy the theater and fine dining. Or you may want to ditch city life and get away from the noise.

Moving across state lines could end up being a great thing for you during retirement. But before you take that leap, there's one Social Security question you'll need to ask yourself.

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Will moving to a different state affect my benefits?

Some seniors pay taxes on Social Security income at the federal level. But there are also 12 states that impose taxes on Social Security benefits. And if you relocate to one of these states, you could see your Social Security checks shrink:

Colorado
Connecticut
Kansas
Minnesota
Missouri
Montana
Nebraska
New Mexico
Rhode Island
Utah
Vermont
West Virginia

Keep in mind that some of these states do offer an exemption for lower- and middle-income earners, so if your income isn't all that high, you might manage to avoid state taxes on your Social Security benefits. But some states on this list offer no such exemption. And if your income is higher, you should prepare to lose some money to those taxes.

That doesn't have to be a deal-breaker. First of all, some of the states on this list happen to offer a relatively low cost of living. So what you lose in the form of state taxes on Social Security income, you might gain back in the form of cheaper housing, transportation, and food costs.

There are also certain benefits of relocating that can't necessarily be measured financially. If your kids and grandkids live in Connecticut and you want to be closer to them during your later years, then it may be worth paying state taxes on your Social Security income, even if you'd rather keep that money to yourself.

You don't have to write off a move to a state that taxes Social Security. But you should know what that list looks like, so there are no unpleasant financial surprises.

Many seniors find that managing their money is a tricky thing once their careers come to an end. So it's important to have a clear picture of what your tax situation looks like if you're making plans to relocate. Furthermore, if you're torn between two nearby states and only one of them taxes Social Security, you may decide to move to the state that allows you to keep more of your benefits — and that wouldn't be a poor choice by any means.

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