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retirement
Ways to downsize during retirement

5. Strip insurance 
In addition to chucking auto insurance for the superfluous car, there are other types of insurance you may be able to ditch.

Life insurance for most people is not an investment tool, CFA Stephen Horan says.

"What it's good for is covering your family to replace income, if you die, that you would have otherwise earned," he says.

If you have a family with kids, it averts the disaster scenario, he says. But if you're retired, your kids are likely grown and productive members of the work force -- and no longer dependent on you.

"Once you're retired, you really have to ask whether you need life insurance," says author Henry "Bud" Hebeler.

Investing in a cash value policy shouldn't replace a savings strategy. If you're retired, it probably makes more sense to buy a term insurance policy to protect your spouse, although some advisers do recommend a combination of the two for pension maximization purposes.

CFP Bill Howell says he was able to free up thousands of dollars by converting a client's individual life insurance policy into one that satisfied the long-term needs of both spouses.

6. Consider moving on 
Contrary to popular belief, most Americans choose not to move when they retire -- 90 percent of the 60-plus population stayed in the same house or county, according to an AARP analysis of the 2000 census.

But moving to an area with a lower cost of living can be prudent. Consider downtown, or an area with cheaper taxes.

CFP Bill Howell says he sees more retirees moving from northern states to the Carolinas, Georgia or Tennessee, where taxes are generally lower.

Bankrate's State Tax Roundup enables you to research target states to find those that are retirement-friendly.

Some retirees are finding small- to midsized cities attractive enough to ditch their cars altogether in exchange for the cultural advantages of urban life. An added health benefit is you can walk to most major attractions.

"I think you're going to see a lot more older people moving into urban areas where public transportation is available and the kinds of stores and things you need are readily available, too," says author Henry "Bud" Hebeler.

CFA Kevin Reardon says many of his retired clients are enjoying the revitalization of the Milwaukee area and are moving back into the city to take advantage the arts, dining and public transportation.

College towns also draw retirees. CFP Connie Stone sees a trend with some Cleveland-area retirees who are moving into places like the University Circle district near Case Western Reserve University in Cleveland. One benefit is that seniors can often sit in on classes at a significant discount, she says. For example, Case Western charges seniors only 10 percent of normal tuition to audit a class.

"I know a lot of people who do that," she says. "They take advantage of all those cultural events and have virtually no transportation costs because they can walk or take public transportation."

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