Living in Florida isn’t just about soaking up the sun; it’s a smart financial move too.
Whether you’re looking to save on taxes or enjoy the affordable lifestyle, Florida’s got it all.
We’ve personally experienced the benefits, and let me tell you, it’s been a real game changer, especially since we moved our business from chilly Chicago to sunny Orlando.
Let’s dive into some cool financial perks of life in the Sunshine State!
1. No State Income Tax
Everyone loves to keep more money in their paycheck and or retirement funds and Florida is a great place to make that happen.
In Florida there is no state income tax!
What does this mean for you? Well, in Florida, you don’t have to give away any part of your paycheck for state taxes. That’s right, the money you earn is all yours to keep!
When we moved from Chicago to Orlando, we immediately received 5% of our income back in our bank account.
Depending on your household income, that could be a major save.
Let’s look at an example of how much you’d stand to save by moving to Florida. The following 10 states have a high migration flow into Florida according to the U.S. Census Bureau.
| State | Income Tax Rate (%) | Tax Burden on $100,000 |
|---|---|---|
| New York | 6.33% | $6,330.00 |
| New Jersey | 5.525% | $5,525.00 |
| Illinois | 4.95% | $4,950.00 |
| Pennsylvania | 3.07% | $3,070.00 |
| Ohio | 2.85% | $2,850.00 |
| Michigan | 4.25% | $4,250.00 |
| California | 9.3% | $9,300.00 |
| Connecticut | 5.0% | $5,000.00 |
| Massachusetts | 5.0% | $5,000.00 |
| Indiana | 3.23% | $3,230.00 |
| Florida | 0.0% | $0.00 |
In Florida, whether you make a little or a lot, you get to hold onto all of it.
This could mean saving up thousands of dollars every year – think of all the extra cash you’ll have for spending or saving up!
Living in Florida can be a real game-changer for your bank account.
2. Low Business Taxes
Okay business owners, we have good news for you when moving to Florida.
The Florida corporate tax rate is super low at just 5.5%!
What does this mean for you? More money stays in your pocket!
This is great news because you can use those extra bucks to grow your business, give your team a raise, hire more employees, or even offer better deals to your customers.
When we moved our real estate business from Illinois to Florida, we found a financial breath of fresh air.
In Florida, our corporate tax rate dropped to just 5.5%, a significant saving compared to Illinois’ 9.5%.
This move not only boosted our profits but also gave us more room to grow and invest back into our business. And the best part is our business grew as a result.
According to a recent report by CNBC, Florida ranked 8th most business friendly state in the country!
Given that Florida is ranked as the 8th most business-friendly state in the United States, there is an 84% chance (42 out of 50 states) that you live in a state with a less business-friendly environment than Florida.
That’s a big deal because it shows Florida really cares about helping businesses thrive.
Whether you’re starting up or scaling up, in Florida, you’re set up for success.
3. Manageable Property Taxes
We thought long about including property tax savings on our list because not everyone is going to save. However, on average, moving to Florida will probably save you money on property taxes depending on where you move from.
Let’s look at the same 10 states with high migration rates to Florida and compare their average property tax rates:
| State | Average Property Tax Rate (%) |
|---|---|
| New Jersey | 2.47% |
| Illinois | 2.16% |
| Connecticut | 2.14% |
| New York | 1.69% |
| Pennsylvania | 1.58% |
| Ohio | 1.56% |
| Michigan | 1.54% |
| Massachusetts | 1.22% |
| Florida | 0.98% |
| Indiana | 0.85% |
| California | 0.73% |
As you can see above, 8 out of the 10 states have higher average property taxes than Florida.
In addition, many of the states listed above like New Jersey, Connecticut, New York, Massachusetts, and Californa have higher average real estate prices which increase the total property taxes paid.
Let’s compare two family friendly areas: Danvers, MA and Clermont, FL.
Both are suburbs of larger cities (Boston and Orlando) and both represent affordable communities with nice schools and amenities.
The average home sale in Danvers is $650,000 and the average home sale in Clermont is $465,000.
| City | Average Home Sale Price | Property Taxes Paid |
|---|---|---|
| Danvers, MA | $650,000 | $7,930 |
| Clermont, FL | $465,000 | $4,557 |
As you can see above, Clermont is nearly $3500 cheaper than Danvers despite the fact that their property tax rates are similar.
The cost of real estate has substantial impact on taxes paid.
Now, we would be remiss not to mention that Florida real estate prices have increased over the last 5 years AND there are many states with lower property tax rates and lower average real estate prices.
However, Florida ranks 22nd for average home sale price and 27th in property tax rate.
| Metric | Florida |
|---|---|
| Average Property Tax Rate (%) | 0.98% |
| Average Home Sale Price ($) | $350,000 |
| Rank in Property Tax Rate (High to Low) | 27th |
| Rank in Average Home Sale Price (High to Low) | 22nd |
4. Affordable Higher Education
Getting a college degree or technical career training in Florida is among the best in the nation.
This is one area where you can really save if you are thinking about going to college or sending your children to college.
Did you know Florida is ranked as the top state for higher education in the whole USA according to research by the CNBC team?
It’s not just about having great colleges, but it’s also about receiving a great education and not breaking the bank.
Take, for example, the University of West Florida. It’s one of those gems that offers an amazing education without breaking the bank. With in-state tuition at $6,360, you can really see the cost-saving benefits of moving to Florida.
And this isn’t a one-time anomaly. Florida is filled with affordable colleges.
- University of West Florida (Pensacola)
- Tuition: Approximately $6,360 (in-state)
- Florida Atlantic University (Boca Raton)
- Tuition: Around $4,879 (in-state)
- University of North Florida (Jacksonville)
- Tuition: About $6,394 (in-state)
- Florida State University (Tallahassee)
- Tuition: Approximately $5,656 (in-state)
- University of Central Florida (Orlando)
- Tuition: Around $6,368 (in-state)
- Florida International University (Miami)
- Tuition: About $6,566 (in-state)
- University of South Florida (Tampa)
- Tuition: Approximately $6,410 (in-state)
- Florida Gulf Coast University (Fort Myers)
- Tuition: Around $6,118 (in-state)
- Florida A&M University (Tallahassee)
- Tuition: About $5,785 (in-state)
- New College of Florida (Sarasota)
- Tuition: Approximately $6,916 (in-state)
Our daughter-in-law, for instance, graduated from the University of Central Florida (Go Knights!!) and was able to pay her way through college on her own.
She came all the way from the Midwest because of how affordable it was compared to schools back home.
And guess what? She finished her degree with absolutely zero debt! That’s pretty rare these days.
And if you’re a veteran, Florida’s got your back big time.
They’ve got programs like tuition waivers for Purple Heart recipients and other combat-related disabled veterans.
Plus, they help veterans with housing, finding jobs, and even give them a leg up in getting state jobs.
It’s all about making the shift to civilian life as smooth as possible for those who’ve served.
5. Low Cost Outdoor Fun
We can keep this section short and sweet.
If you are moving from a northern climate where you are inside half the year, Florida’s year-round sunshine makes it easy to have zero-cost fun.
Florida offers endless opportunities for free fun with its vast network of trails spanning thousands of miles and an impressive 90% of its beaches being accessible to the public.
Regardless of the season, you can enjoy Florida’s attractions all year round without spending a single penny.
You better believe we enjoy taking our kids and grandkids to the beach and saving lots of money along the way.
We chose Clermont, FL as our home for its breathtaking hills, extraordinary outdoor lifestyle, and the enchanting chain of lakes dotting the landscape.
Check out our recent post on why Clermont offers an amazing and affordable lifestyle.
6. Low Cost Travel
Florida is an amazing place to live if you enjoy traveling.
Since we’ve moved to Florida, we’ve identified three ways Florida saves you money on travel.
Reason 1: Florida is a vacation destination in its own right.
- Living in Florida means you’re already in one of the world’s most sought-after vacation spots. From stunning beaches to famous theme parks, there’s so much to explore right in your backyard. This cuts down on the need for long, expensive trips to find similar experiences elsewhere.
Reason 2: You no longer have to board a plane before cruising.
- Florida’s numerous ports, like Miami, Fort Lauderdale, and Tampa, make it a prime spot for cruising. You can literally drive to the port, park your car, and embark on a cruise, saving on airfare and the hassle of airports. It’s a game-changer for cruise lovers!
Reason 3: Neighboring states offer great adventures (road trips).
- Florida’s location makes it easy to road trip to nearby states for quick getaways. Whether it’s the historic charm of Savannah, Georgia, the vibrant music scene in New Orleans, Louisiana, or the natural beauty of the Smoky Mountains in Tennessee, there’s a wealth of diverse experiences just a drive away, saving on airfare and offering the flexibility of road travel.
We love getting in our car from Orlando and driving 2 hours in the early morning to spend the day in Siesta Key.
We also love booking last minute cruises and driving to the port, parking, and having the time of our life—without paying a penny for plane tickets.
We love driving up to the Smokey Mountains and renting a cabin for the weekend.
Traveling is really affordable living in Florida.
7. Affordable Amenities (Especially for Seniors)
If you are at or near retirement age, then Florida has more discounts than you can count.
Florida has the highest percentage of seniors out of any state with more than 19% of the population over the age of 65.
Businesses need to attract new and existing customers and one way they do this is by offering robust senior discounts.
Many museums provide a generous senior discount, state parks also offer discounted rates, numerous restaurants have special offers for seniors, and that’s not to mention the vast selection of senior clubs and communities that provide affordable activities and amenities.
Florida is an amazing place for seniors to move because it’s affordable, and the fun is relatively cheap.
You may be interested in our recent blog on why so many retirees are flocking to Florida.
Conclusion
Well, that’s a wrap from us!
We hope you found these insights helpful. Florida isn’t just about gorgeous beaches and thrilling theme parks; it’s also a place where your wallet gets to relax a bit more.
Whether it’s the tax savings, affordable education, or just having fun in the great outdoors without spending a dime, Florida’s full of surprises.
If you’re thinking about making a move or just want to know more about this wonderful state, give us a shout.
We’re always here to help you navigate the sunny side of real estate.
Frequently Asked Questions
Are there any tax benefits for first-time homebuyers in Florida?
Florida offers tax advantages for first-time homebuyers. One advantage is the homestead exemption, which reduces the taxable value of your property by up to $50,000 and lowers your annual property taxes. Another advantage is the Save Our Homes cap, which limits the increase in assessed value of your property to a maximum of 3% per year or the rate of inflation, providing long-term tax relief.
Is health care affordable in Florida, especially for seniors?
Florida has a good healthcare system for seniors, with hospitals and facilities that specialize in senior care. The state’s policy of no income tax can indirectly help seniors by giving them more money to spend on healthcare. There are also programs in place to make healthcare more affordable for seniors.
How does the climate in Florida affect living costs?
Florida’s warm climate means lower heating costs in winter compared to colder states. But the hot, humid summers can increase air conditioning usage, affecting electricity bills. However, the year-round warm weather encourages an outdoor lifestyle, saving money on indoor entertainment. Also, mild winters make gardening and growing your own produce more feasible, potentially reducing grocery expenses.
