I’m sitting here thinking about the financial implications of every move I have made over the last ten years and wondering what I would have done if I knew the true cost of living in every city I ended up in. Honestly, I’m glad I didn’t know the whole picture, but I’m also thankful I knew enough to make an informed decision on whether or not the move was wise for my specific financial situation.
We all know the cost of living in San Francisco or New York is astronomical, but nobody really cares if the city they could be relocating to has a high cost of living (HCOL), Low cost (LCOL), or even in the middle (MCOL). We want to know the cost of living in comparison to where we live now.
In other words, will my dollar go further or will I need to ask for even more of a salary increase to maintain my current lifestyle.
Before applying for a position that is outside of my current commuting radius, I take 10-15 minutes and follow the below steps:
- SmartAsset, Numbeo and Payscale offer resources for determining the increase or decrease in the cost of living between where you are currently and where you are considering moving. The key is to be as specific as the site will allow you, and input all of your Pre and Post Tax deductions.
- Look at the Reddit group associated with the city and search “New to X” or “Moving Soon” and you’ll find others who have requested which areas are the “best areas” and COL information.
- Finally, go to Zillow or Realtor and see what a rental or homes for sale are going for compared to your current situation.
After that short detour, I’ll know if I would be willing to relocate and feel comfortable throwing my hat in the ring.
But it doesn’t stop there. These 3 steps will only give you an overarching understanding of the large expenses, but doesnt touch on all the little ones that can end up eating at your budget and make you second guess your new city.
Housing Costs
This is one of the largest, and most important costs associated with moving. Be sure to check Zillow and Realtor to gauge the home prices and cost of rents.
Also check on Reddit, and ask ChatGBT about the safest and best neighborhoods in the area. You don’t want to end up in a home that was priced perfectly for your budget, only to determine it’s in a terrible area.
By following the steps outlined above, you’ll have a clear understanding of if you’d experience and increase, decrease or maintain the current lifestyle you are accustomed to.
Utilities and Services
Never would I have thought about the cost of utilities prior to my most recent move. Everyone tells you If you move south, be aware… the Summer months are going to cost you because of the heat and running the A/C. Vice versa for the North. But no one warns you that each area has a different cost to energy. Yeah, who would have known that?
We moved from Knoxville, TN to Atlanta, GA. Only a 3.5 hour drive, but our utilities bill literally doubled. Take the time to compare costs and not assume it will be “about the same.”
Transportation
Public Transit: If you are looking into a major metro area, the availability and cost of public transportation can impact your commuting expenses. Some cities have extensive, affordable transit systems, while others rely heavily on cars.
Car Ownership: If you need to drive consider: gas prices, parking, tolls, maintenance costs, and the up front cost of registering the vehicles in your new state along with recurring yearly registration fees.
Groceries and Dining
Using the tools: SmartAsset, Numbeo and Payscale, you’ll be able to see a comparison of normal grocery costs. As you flip through, you’ll see that the prices it is claiming in your area may be different then what you are actually paying. This could be due to a difference in quality (pasture raised eggs vs free range) or simply if you are shopping WholeFoods vs Aldi or Walmart.
When I first left the midwest, I was devastated when I realized Mejier was no longer an option. The major chains in my area were Walmart, Kroger, Publix, and Aldi. So being young and on a tight income, Aldi and Walmart became my best friends. Look around on Google Maps to see what options are in the area you are moving.
Taxes
You either love them or hate them. I’m 1000% in the later group.
State and local taxes can significantly impact your take-home pay. Compare income tax rates, sales taxes, and property taxes between your current and new locations.
Especially if you are coming from a state that is blessed to not have state income taxes. Oh, how I miss those days! On a salary of $100,000.00, You could see a decrease in your take home pay between $2,000.00 – $13,000.00, and considering that most companies are offering yearly raises somewhere in the 2-5% range, that’s a huge difference in your overall compensation.
Childcare and Education
This falls between housing and car payments when it comes to cost. According to a 2023 survey of the United States, the average cost of 1 child in daycare can range from $4,810.00 per year to $15,417.00… yikes.
If you have young children in daycare look at a few local options in the neighborhood you are interested in moving to. Do the prices encourage you or discourage you when it comes to relocating?
If you have already accepted the job, consider adding yourself to a few wait lists now while you’re working through the logistics of the relocation.
Lifestyle and Entertainment
Before we moved to the Atlanta metro area, we would go out on a weekend and spend $50-$60 on dinner and drinks. If we wanted to splurge, we would get dressed up and spend $100-$120 (this all included tip by the way). Now, on a regular dinner at a non-chain restaurant we are spending $80-$110. A draft beer out costs $9-$10. This is crazy to me.
Do some sleuthing on the local restaurants, bars, clubs, breweries… whatever you are interested in doing. Look into their regular pricing to see if it makes you choke.
Knowing The Cost Of Living Before Relocating
If your cost of living is going to increase, knowing this before relocating will help swallow that bitter pill and prepare you for the change to your lifestyle. It could also give you a clearer goal when it comes to determining your rock bottom salary number during negotiations.
Only you’ll be able to determine if the move makes sense for you and your family financially, and having all the facts can help you make an informed decision. Moving for career growth could be the best thing you do – but only if you are prepared and have a plan.
BK
P.S. What are some costs that you are evaluating before making the move? A big one that gets overlooked in the excitement of the new opportunity is the actual cost of moving.