|<why not just move to a cheaper state, like Texas? >|
Cheaper for income tax, but not for property tax. It's at least double the California rates. But, for now at least, the real estate prices are lower.
<I am somewhere in the upper 300s>
<Don't you have a 401K>
Of course, that doesn't let you shelter much when you are in that income bracket.
If your income is self-employment income, you can set up a Defined Benefit Plan. Costs about $1000/year to administer. But you can contribute (depending on your age) as much as 100% (or even more - again, depends on age) of your self-employment income.
If you set up an LLC, you get some real flexibility. You can arrange for part of your income to be self-employment income (and thus making you eligible for the Defined Benefit Plan) and any excess beyond what is needed for that as Ordinary Income (and thus not pay Self Employment Tax on it.) Salary or guaranteed payments are self-employment income. Distributions which are not guaranteed payments are Ordinary Income. You can slice it whichever way works out best for you.
<Anybody out there know a good place to retire?>
Well, I know about Brazil. You can get a permanent retirement visa by arranging to transfer $35,000/year to a Brazilian account from your retirement account. The only problem with this is, it's way more than you need to live on. There are no restrictions on foreign ownership of property. (Mexico restricts ownership within 200 miles of the border and coast, and horrible problems recently in N. Baja with conflicting lease claims, forcing American retirees out of their established homes.) Food and clothing are cheap, service is excellent, and housing is cheap, thanks to chronic under-employment. Most Brazilians DO own their homes, though it is nearly impossible to finance - I suppose the inability to finance helps keep the prices down, as well as other factors. (UN-employment is not as scary as other South American countries, such as Argentina, but is made up for in horribly low wages for the masses.) Of course, this could all change. There are security issues in the big cities (mainly Rio and Sao Paulo) mainly involving the drug trafficking and the growth of shanty-towns. But there are very nice areas in the south that are safe. (Check out Curitiba, curitiba-brazil.com )