Cost of living: Why you should choose a cheap place to live

Cost of living: Why you should choose a cheap place to live

While visiting Raleigh earlier this month, I spent a morning with my pal Justin (from the excellent Root of Good blog) and his wife. As we sipped our coffee and nibbled our bagels, the conversation turned to cost of living. (Money nerds will be money nerds, after all.)

“Things are cheaper here in North Carolina than they are in Portland,” I said. “Food is cheaper. Beer is cheaper. Hotel rooms are cheaper. Your homes are cheaper too. Last night, as I was walking through the neighborhood next to my hotel, I pulled up the housing prices. I was shocked at how low they are!”

“Yeah, housing costs are lower here than in many parts of the country,” Justin said.

“Take our house, for instance. We bought it in 2003 for $108,000. Zillow says it's worth around $198,000 right now. But I'll bet that's a lot less than you'd pay for a similar place in Portland.”

He's right. Justin and his wife own an 1800-square-foot home on 0.3 acres of land. Their place has four bedrooms and 2.5 bathrooms. There's only one place for sale in Portland right now that matches these stats and it's going for $430,000 — more than twice the price the same home would fetch in Raleigh.

Housing prices in Raleigh, NC

Housing is by far the largest slice of the average American budget, representing one-third of typical household spending. Because of this, the best way to cut your costs (and, therefor, boost your “profit margin”) is to reduce how much you spend to keep a roof over your head.

One obvious way to cut costs on housing is to choose a cheaper home or apartment. But if you truly want to slash your spending, consider moving to a new neighborhood. Or city. Or state. If you're willing to change locations, you can supercharge your purchasing power and accelerate your saving rate.

Cost of living is one of those factors that people seldom consider, but which can have a huge impact on the family budget — sometimes in unexpected ways. According to The Millionaire Next Door:

Living in less costly areas can enable you to spend less and to invest more of your income. You will pay less for your home and correspondingly less for your property taxes. Your neighbors will be less likely to drive expensive motor vehicles. You will find it easier to keep up, even ahead, of the Joneses and still accumulate wealth.

It's one thing to talk about the effects of high cost of living, but another to actually experience it.

Cost of Living in Real Life

On our fifteen-month road trip across the United States, Kim and I made a point of watching how prices varied from city to city and region to region.

While stranded for ten days in rural Plankinton, South Dakota, for example, I paid $10.60 for a fancy men's haircut. At home in Portland, I pay $28 for the same fancy haircut. In Fort Collins, Colorado, I paid $30 for a haircut. In Santa Barbara, California, I paid $50 or $60 for the same fancy cut.

Gas was cheaper in South Dakota too. So was food. So was beer and whisky. So were movies. So was just about everything, including housing. Housing prices followed a similar pattern to the haircut prices I mentioned above. A $280,000 home in Portland might go for $300,000 in Fort Collins and $500k to $600k in Santa Barbara. In South Dakota, that same home would cost about $106,000.

A couple of years ago, I exchanged email with a reader who had first-hand experience struggling with the high cost of living. She gave me permission to share her story:

I had been saving about 40% of my relatively modest salary for eight years. I had built up an emergency fund as well as a good sized savings…and then we had kids.

We lost our rent-stabilized apartment right after our children were born. We live in New York City, and while I maintain that there are many things about the city that are actually very budget-friendly (public transit and free entertainment top my list), the cost of rent and daycare in NYC are over the top.

In one year, the cost of a market-rate apartment in our neighborhood plus two kids in daycare ate into my hard-earned savings. By the end of the year, the pot of money that I had worked so hard to save was down by almost $50,000.

Luckily, my husband and I have never carried any kind of debt and had already been living well below our means before the kids came along. But that also meant there was very little fat left to trim in our budget other than rent and daycare expenses. (We'd already dropped the landline, never had cable, cooked almost all of our meals at home, and cut out our modest “allowance” of $50/month for splurges.)

We are the very definition of penny wise and pound foolish!

Eventually, we moved into a cheaper apartment. Although we haven't had to dip into savings since we moved, we're still essentially living month to month because of daycare and rent. The neighborhood is cheaper for a reason.

Real Life will force us to make another move in the spring. One of our jobs is going away, so it will force a decision one way or another since we can’t stay in New York on one salary. Change is definitely coming.

This reader and her husband are already frugal-minded — that's how she built her buffer of savings to start with — so there isn't much more the family can cut. This is an example where the only real solution is to seek a city with a lower cost of living.

Saving in Savannah

Which places are cheapest to live? Which are most expensive? This map from Governing magazine shows how far the average paycheck goes in 191 U.S. metro areas.

[Cost of Living map]

Dark green (blue?) dots indicate cities where your wages buy more after adjusting for cost of living. Dark brown dots are places where you have to work harder to get what you want. (Click through to play with an interactive version of the map.)

As you can see, large coastal cities tend to be more expensive than smaller towns in the center of the country. If you have a fixed budget, you'll get more bang for your buck by buying a home in Oklahoma City or Sioux Falls than by living in San Francisco or Washington D.C.

It's not just coastal cities, though. There are spendy pockets throughout the U.S. from Flagstaff, Arizona to Hot Springs, Arkansas. And some coastal cities — Boston, Houston, Seattle, Tampa — are relatively inexpensive. (In Boston and Seattle, though, that's because wages are high, not because things are cheap.)

In the middle of our road trip, Kim and I decided to stay the winter in Savannah, Georgia. During our six months in Savannah, we spent much less than we would have for the same lifestyle here in Portland. According to the CNN cost-of-living calculator, Portland is 44% more expensive than in Savannah. (And housing costs nearly three times as much here as it does in Georgia!)

[Cost of Living calculator]

In larger cities, there are often cost-of-living differences between neighborhoods. When deciding where to live in Savannah, for instance, we had a choice:

  • We could rent a small apartment in the downtown historic district for $1750 per month. The place would have been a lot of fun because it was surrounded by shops and restaurants, and it was close to anything we might want to do.
  • We could opt instead for a modest-sized condo on the outskirts of town at $1325 per month. This location was next to nothing. We could walk to the grocery store, but we'd have to drive into the city if we wanted to indulge ourselves.

After considering financial and lifestyle factors, we chose to rent the condo in the middle of the marshlands. On the surface, this decision saved us $425 per month. In reality, it saved us much more than that.

If we had lived downtown, we would have had to pay to park the Mini Cooper ($95/month). We would have been constantly tempted to eat out or go for drinks. It would have been too easy for window shopping to become actual shopping. Instead, we enjoyed one Date Night each week. We spent the rest of our time working and exercising.

I believe that opting for the less glamorous location saved us a minimum of $5000 over our six month stay — and the real savings are probably far greater.

Pinching Pennies in Portland

This same concept — certain neighborhoods costing less than others — was a driving factor in our decision last year to sell our condo and move to “the country”. We loved where we lived, but the costs were crazy.

  • First, there were the maintenance costs for a place that we ostensibly owned outright. Even without a mortgage, we were paying nearly $1200 per month for HOA fees, utilities, insurance, and more. (In our new place, we spend half that.)
  • Plus, there was the sneaky cost of lifestyle inflation. Our condo was in a fun neighborhood filled with restaurants and bars. It was all too easy after a long day to simply walk up the street to one of our favorite spots, where we'd drop $50 or $100 on food and drinks. Moving to our new place cut our restaurant spending in half.
  • Lastly, the cost of goods in our new neighborhood is lower than in our old. In Sellwood, our grocery options were limited. And expensive. The nearest markets were both high-end organic-only affairs, the kind of places you might see on an episode of Portlandia. Yes, the quality was outstanding. But since we've moved, we're spending about 25% less on groceries each month.

Moving helped us save big on some cost-of-living items. But it also brought with it a few increases in spending. Because we're more rural now, we drive more often. Kim, especially, is spending more on gas. Our “new” home also has greater maintenance costs than the condo. We've poured a ton of money into this place since moving in. (I guess that's not actually a cost-of-living issue so much as a homeownership issue, though.)

My point is that even within a city, there are cost-of-living differences you can leverage to your advantage — especially if you're willing to live in a rougher part of town.

The Bottom Line

Obviously there's more to picking a place to live than pure price.

When you choose a city (or neighborhood) to call home, you do so because of the climate, the politics, and the people. You want to live close to friends and family. You want a nice school district. You want people who think and act the same way you do. For those reasons (and others), Omaha might not be a good choice for you. (Savannah isn't a good choice for me long-term, but it was fine for a few months.)

Here's the bottom line: Where you choose to live has a greater effect on your long-term financial success than almost any other factor. How much you earn is sometimes more important (not always), in which case cost of living is a close second.

Cost of living can wreak havoc on your pursuit of financial freedom. Or it can help you achieve your goals sooner than you thought possible. The choice is yours.

Other ways to make the most of your housing budget? Consider renting. Live close to where you work so that you can walk, bike, or take the bus. Purchase a house that fits your lifestyle and needs rather than the commonly cited “buy as much home as you can afford”. The latter is self-serving advice from real-estate agents and mortgage brokers. You don't need a big house; you just need someplace comfortable.

More about...Home & Garden

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Susan
Susan
2 years ago

I think the map should have a high cost of living for the Boston area. I have lived here nearly 15 years and I just barely hit the “median” salary. I live in the suburbs where housing is less, but I would say we are nowhere near “relatively inexpensive.” I have lived in TN and MI, so I feel those areas are better suited to this description.

Accidental FIRE
Accidental FIRE
2 years ago

One thing to consider though, it’s very often the case that your same job or profession will earn you much more in the more expensive region or city. So at that point, it becomes kind of relative – you may spend more for everything but you also earn more. I live in the Washington DC area and was surprised to see it bluish on that map. We are known for being one of the most expensive areas in the country, esp for housing. But we also have the best job market and the highest median incomes – the five richest… Read more »

Sarah
Sarah
2 years ago

Yes! Thank you for mentioning this. I live in Los Angeles and have a well-paid job in entertainment. Living in any other city would mean a drastic pay cut, and probably a less fun job.

Josie
Josie
2 years ago

Also live in the DC metro area and am able to save more than when I was living in a rural town. I work in tech and the job market is hot here versus Roanoke VA 🙂 I’d have to save an additional 10% (30% savings vs 20% savings) of my Roanoke income in order to make the same dollar amount of savings monthly.

Shari
Shari
2 years ago

Very true! I am a librarian in South Dakota, and while it is cheap to live here, it has to be because wages are far lower than other places. I could get $20,000-$30,000 more per year for the same job if I moved just a state or two away.

The Poor Swiss
The Poor Swiss
2 years ago

Wow, the differences in price are huge in the United States. In Switzerland we have some differences as well, but mostly big cities compared to around villages. Zurich for instance is the most expensive city in the world. But rural areas around the countries don’t have that much difference. On the other hand, we are so small 😛

freebird
freebird
2 years ago

Depending upon your career path, where you choose to live can also have a strong effect on your earnings trajectory, so I think the best target should not be either earnings alone or living costs alone, it’s the after-tax difference (‘net margin’) that you should aim to maximize. Decades ago after finishing my engineering degree from a Big-10 school, I joined the hordes of similarly equipped new grads from the Midwest who were piling into silicon valley. Even back in those days living costs in the Santa Clara Valley were much higher than the place I grew up, but then… Read more »

CPA1
CPA1
2 years ago

I moved from DC to Raleigh 10 years ago. It was one of the best decisions I ever made. I would advise young folks to live in a large city with lots of job opportunities for a few years and then take that experience and move to a mid-major city. You’ll likely be higher up on the food chain with the big city experience you will get. The smaller city will never be as exciting, but, many of the smaller cities have tons of activities. Raleigh is great because we have so many universities. There are always events and the… Read more »

Eileen
Eileen
2 years ago
Reply to  CPA1

We also live in Raleigh (24 years now). We loved it 24 years ago and might love it more now. We actually moved from a cheaper place (BR, LA) but our earning was better right away. We actually considered moving to Charlotte (even turned down job offers) a year before we settled on Raleigh — it just didn’t feel right. Perhaps it’s because Raleigh feels like Baton Rouge (university, state capital) but with so much more (4 seasons, more progressive, mtns and beaches nearby, etc). We are almost empty nesters (youngest graduates from college this week) and friends our age… Read more »

Wesley
Wesley
2 years ago

I got lucky on the location portion. The southeast does have some rather pricey areas (Mountain Brook, AL is $$$), but by and large, there are plenty of affordable options in nice areas, with good people and low crime. My bigger concern, and something you’ve likely already covered, is more controversial: Divorce. While your locale is likely the biggest factor during your working/saving years, from what I’ve seen in the lives of those around me, divorce is by far the bigger wrecker of financial health. When it happens early in life, it’s recoverable. Later on, it can ruin you if… Read more »

bogart
bogart
2 years ago

Missing from this discussion is the question of whether one wants to live close to family. This can be important (including its impact on bottom line, though certainly not only for that reason) when kids are young or parents are old, but I also found that when I was working in a different part of the country I spent all my (limited) vacation time traveling “home,” often at (expensive to travel) times when I didn’t want to be traveling at all (Thanksgiving). Others may not find themselves as affected by this challenge as I did, but it’s worth factoring into… Read more »

Eileen
Eileen
2 years ago
Reply to  bogart

This is absolutely true and was one of the reasons we moved from the deep south to NC. My in-laws were in PA, my parents had retired to the mtns of NC.

There were other reasons too, but after spending vacations driving 20+ hours to PA, then swinging back thru NC, it was much nicer to move within a day’s drive for each set of grandparents.

Jen G
Jen G
2 years ago

We’re moving from Seattle to Portland this summer. I’m definitely having trouble picking a neighborhood that balances our desire to be frugal, live a Portland lifestyle, and have good schools for my kids. Seattle – it’s all expensive and the differences between school districts aren’t as great – at least on the north end of the city. Because my husband works as a journalist and my salary is average, Seattle doesn’t feel “relatively cheap” for us, but selling our almost-paid for house in this market will be an instant windfall.

anon +40
anon +40
2 years ago

Why is this always a throwaway line in considering where to live for finance bloggers? “you do so because of the climate, the politics, and the people. You want to live close to friends and family. You want a nice school district. You want people who think and act the same way you do” If you’re living according to your true life values & missions, these things are not throwaways, they are essential. I guess some folks may not value family & friends, but then, what’s the point of becoming financially independent if you can’t spend time with those you… Read more »

Ris
Ris
2 years ago
Reply to  anon +40

I thought the same thing! There are places in the US you couldn’t pay me to live, no matter how low the cost of living/housing/etc is.

Brittany Hassell
Brittany Hassell
2 years ago

This is exactly why I have been researching out-of-state investing in the Midwest! I can buy six duplexes in many places for the price of one of our duplexes here in the Portland Metro and they all have WAY better ROI. It’s a no-brainer to me, since I’m just lil ol’ me who wants to do real estate investing and realizes that our lovely area just isn’t for me.

JoeHx
JoeHx
2 years ago

I’m lucky that where I live, southwest Ohio, is both low-cost-of-living combined with several decent-paying jobs. I probably could make more living somewhere such as Silicon Valley, but I have a feeling the cost-of-living would make it not worth it.

rh
rh
2 years ago

We’re selling our house in Portland (Mississippi Ave area) and simply renting a 1 bedroom apartment 5 miles west of downtown. Cuts our commute by 75%, the proceeds from the house will be simply put into a high yield savings acct. which will pay for the apartment rent. We’ll then explore some other smaller towns this year to see where we want to settle down in a cheaper area where housing costs about 1/2 of Portland.

Tara
Tara
2 years ago

I live in an area where homes are inexpensive but property taxes are higher (SE Pennsylvania). I have family in a small town in eastern NC where you can get a decent home for around $100-$150k, and property taxes are much lower. There are less social services in that area than our area (in PA for instance, you can be paid by the state to take care of an aging parent who would qualify for home health care aids) and the public schools aren’t great. But if you are someone who plans ahead financially and takes care of your health,… Read more »

Allison
Allison
2 years ago
Reply to  Tara

If your sister is paying $1,700 for an apartment in Cleveland, she is getting ripped off. She likely lives in one of those new loft-style places in or near downtown. You can get something nice for around $1,000, perhaps a part of a duplex that is in a “real” neighborhood. I pay less than $700 for a one-bedroom in the southern suburbs, but I don’t work downtown and it would be a bit of a commute.

dh
dh
2 years ago

We have a low cost of living here in Albuquerque, New Mexico, with great weather (and all 4 seasons), beautiful scenery, terrific food and shops. The crime is kinda off the hook, tho. Anyone ever seen Breaking Bad? I’ve also lived in Las Vegas, Nevada, another low-cost place with no state income tax and TONS to do all time, whether it’s all the entertainment options or the great hiking out in the foothills or Red Rock Canyon. Plus in Vegas, a person isn’t very far from the beaches and theme parks in Cali. I think Vegas will be my place… Read more »

dh
dh
2 years ago
Reply to  dh

Oh, and as a bonus, Vegas just got an IKEA, so you can furnish your new place for cheap hehe.

Sequentialkady
Sequentialkady
2 years ago
Reply to  dh

Recently visited ABQ for my 20th wedding anniversary. LOVED it. Excellent food. (Husband is a vegan and I can’t handle gluten or corn and we found more food options there than in NYC. Flying Star Cafe — OMG!) Nice people, and according to my friends, it’s not as blisteringly hot there in the summer as it is in Las Vegas. I could see myself living there when I retire. (It’s about as cold as I’d ever want it to be in the winter.) Vegas is more reasonably priced than the tan dot would lead you to believe. I know many… Read more »

dh
dh
2 years ago
Reply to  Sequentialkady

Vegas seems to always be about 10 degrees warmer than we are here. However, Vegas has about the least humidity of any major city in the US, which makes a big difference — not that Abq is humid, mind you, but Vegas is still a much drier heat. And yeah, I didn’t quite understand the tan dot re: Vegas. It’s known for being a cheap place to live. Even Mr. Money Mustache included it in one of his posts on fun places to move to for a lower cost of living.

dh
dh
2 years ago
Reply to  dh
S.G.
S.G.
2 years ago
Reply to  Sequentialkady

Las Vegas is the 7th layer of hell in July. ABQ is only the 3rd.

“But it’s a dry heat” only works as you pass 90. After you hit 100 it’s all miserable.

dh
dh
2 years ago
Reply to  S.G.

Lol I know, I know. I can’t believe I played the “dry heat card.” I feel like it’s almost a kind of social faux pas to say, “But it’s a dry heat.” But it *is* a nice, dry heat in Vegas hahaha!!!!!

Anyway, there’s a super great YouTube channel re: life in Vegas called Jacob’s Life in Vegas:

https://www.youtube.com/watch?v=FOvmlsMQn5M&t=12s

I’d really be curious, S.G., where you would move if you ever decide to leave NM.

S.G.
S.G.
2 years ago
Reply to  dh

It would depend on why we moved. If we moved for jobs it would be wherever the jobs were. I wouldn’t live in CA but maybe FL or TX (both hot AND humid, ugh).

If we were moving to retire somewhere with a good property and low COL like southern midwest. MO maybe?

We talk about it, but the liklihood of us leaving any time soon is low.

As for Vegas, i was just there last week visiting family. I’d only live therw as a snow bird. May to Sept isn’t safe for man nor beast.

dh
dh
2 years ago
Reply to  S.G.

Interesting you mention FL, as that’s where I vacation the most. Orlando has a low cost of living, similar to Abq. I know Orlando is not a beach town, but by living in the center of the state, one drastically lessens the possibility of storm disruption. Besides, Orlando does have fun theme parks, plus Cocoa Beach is only an hour away. And there’s a high-speed train being built right now that will link Orlando to Miami. I’m just not sure I could take the humidity, tho.

S.G.
S.G.
2 years ago
Reply to  dh

Our neighbors moved to Orlando. He was Lockheed and transferred.

I haven’t been to FL yet but I’ve heard horror stories about the massive bugs. Though I have survived the red headed centipedes. I guess I’ll see for myself in about a year as we’re planning a DW trip. Any advice?

dh
dh
2 years ago
Reply to  S.G.

Advice-wise, you want at least 4 days for DW, one day per park. Get the hopper pass so that you can move from park to park if you want. Universal is super fun too, but it may be best to save it for another trip. The crown jewel of Florida is Miami Beach, so that may be worth taking one day to work in. And by the time you get to Orlando, that high-speed train linking to Miami should be up and running. A lot of people don’t realize that Miami Beach is an island city, with its own mayor,… Read more »

dh
dh
2 years ago
Reply to  dh

And as far as bugs go, you aren’t gonna see any lol!! Disney doesn’t have bugs!!! Okay, the spray guys miss a few here and there but nothing to worry about hehe.

Sequentialkady
Sequentialkady
2 years ago
Reply to  S.G.

“But it’s a dry heat” only works as you pass 90. After you hit 100 it’s all miserable.

Vegas locals don’t consider it “triple digit” heat until it hits 110.

Anything up to 105 is fine, but above 107 you can really start to feel each degree of increase.

That said, Nevada Power is not a wimpy power provider. It can be 117 outside, but it will be 78 indoors. (But, brace for impact. Your winter power bill will be about $50. Your summer power bill is going to be about $200.)

S.G.
S.G.
2 years ago
Reply to  Sequentialkady

I know all about Vegas. I grew up in Northern Nevada and a large chunk of my family live in Vegas. And 105 is hot.
I’m not sure what you mean by different meanings of “triple digit” since it literally means a number with 3 digits.

105 is hot, no matter how you slice it. You’ll start to feel that when you breathe. But yeah: when you can look forward to the hundred and teens you dont curse the demons necause you’ll tempt the devil to come out and play.

FoxTesla
FoxTesla
2 years ago

Glad you reminded people about your time in South Dakota! Not only is cost of living lower, but SD is one of the states with no state income tax.

In the spirit of your post, people will be sure to complain “my work is too focused to be able to move”, but more often than not I think the flexibility will exist.

Also, in the category of “it’s a small world”, the RV park you stayed at was my grandparents’ farm of 50ish years – the building by the cabins was a secondhand shop.

Wolfgang
Wolfgang
2 years ago

That’s funny. We had dinner with a realtor friend of a friend the other day (we live in Raleigh as well) and I was making comments how there are absolutely no houses under construction around us that would sell for less than 500K (most are quite a bit higher). The realtor said that it’s almost impossible to find any affordable (as in 150-200K) housing in Raleigh at the moment. We live in a townhouse (a rather nice one) and already had two realtors knock on our door to see if we weren’t interested in selling. Another sign: in our 60… Read more »

lmoot
lmoot
2 years ago

I get that incomes are higher in HCOLAs, but a majority of people living there are not in the type of careers that are paying 10s of thousands more than their comps in LCOLAs. Even if you are “big fry” there may be more opportunity (because of less competition), to get promoted positions that you’d normally have to spend years working up to. I already live in a fairly LCOLA (but in a state that has several HCOL), and even still sometimes I dream of trying it out in a small town in another state. Mostly because I want to… Read more »

S.G.
S.G.
2 years ago
Reply to  lmoot

Yes. When i graduated i wqs offered about 40% more in El Segundo, CA than Albuquerque, NM. But the COL made ABQ a financially better option with a more comfortable lifestyle (commute time, etc)

Rebecca @ BackroadMotorsports
Rebecca @ BackroadMotorsports
2 years ago

COL in Georgia is great in some areas, however the school system vary widely. We chose an area that is a bubble with a higher than average COL, but excellent schools. With an LD child, it was a priority to get in a school system that would serve all of our children’s needs. The trade off of higher housing costs is still cheaper than private LD school tuition. However we do plan to sell the house and move to a cheaper area once the youngest graduates in 5 years. I think its a trade off of your personal choices when… Read more »

Joe
Joe
2 years ago

I’d like to see how moving to a house work out for you guys in the long term. Is it really cheaper in the long term?
I don’t like paying our HOA either so I’m planning to move soon. We’re moving in town, though so we won’t save that much. Maintenance, repair, and remodeling will cost a ton when we move.

Eileen
Eileen
2 years ago
Reply to  J.D. Roth

Will you include (though I suppose it’s another, related topic) reflections on purchasing *this house* as opposed to others…or waiting longer to find “the house”?

I’m curious if you think that costs with the home you bought are higher than others (purchase + repair) or about right (buying a less needy house, but for more)?

WantNotToWantNot
WantNotToWantNot
2 years ago
Reply to  J.D. Roth

At the risk of repeating myself, I’ll put forward the unpopular opinion that one should not consider the house you live in as an investment. It’s an asset. Yes, this real estate asset might occasionally bring a profit. I’ve made tidy bundles twice in selling primary-residence coop apartments in Manhattan. But those were lucky unicorns in my financial history. A house (especially if you love it, and lavish time and money on it) is an asset that comes with a ton of expenses—maintenance, repairs, upgrades and reno-projects. And then there’s the garden! For the past 15 years, we’ve been fixing… Read more »

Jason@WinningPersonalFinance
2 years ago

I work in NYC and live in the suburbs. Even with a two-hour commute to work today, my housing is expensive. The nice thing about living in a high cost of living area is that wages are inflated too. The best case scenario is to earn an NYC salary and spend it in a rural setting.

Kate
Kate
2 years ago

Yes, I agree with you. Since we are in the same state, the higher salary fits the higher costs in some aspects. If one was able to work from home or online, then definitely would be a far better choice to live in a lower cost area!

infmom
infmom
2 years ago

My mother always lived where she felt entitled to live, not where she could actually afford to live. I tried and tried to convince her to move to less expensive housing, but she always had a Real Good Reason for staying put (and struggling to pay the rent). Fiddle de dee, I’ll think about that tomorrow. My brother moved from Louisville (where most things are way cheaper) to San Diego (where the price of everything is astronomical) because he felt he could make more money in California. No matter how many times I suggested that he go get a copy… Read more »

Laura
Laura
2 years ago

People keep trying to convince me to move back to SD but, no, for many reasons. In the (2) larger cities, houses can still be fairly pricey and you have to DRIVE everywhere. I remember having to drive 10+ mi one way, every day to high school, 8 mi to the nearest grocery store, etc. My cousins are driving all over the state for their kids sports and over 100 miles a few times a month for shopping trips in the “big city”. There are other reasons, too. OTOH, I wouldn’t mind leaving Portland for somewhere else less expensive if… Read more »

Bonnie
Bonnie
2 years ago

I’ve never lived anywhere that wasn’t LCOL (grew up in the South and now live in the Midwest [St. Louis]). People should consider STL more than they do. For one, you can get a beautiful home for a fraction of what it would cost elsewhere. The weather isn’t nearly as bad as it used to be (climate change). We haven’t had a real snowfall in a long time at this point. There are four distinct seasons. There is a park that truly rivals Central Park, free museums and fantastic (also free) zoo…lots of universities and a steadily growing tech sector.… Read more »

Bonnie
Bonnie
2 years ago
Reply to  J.D. Roth

The Ozarks are a place I’d like to explore more. I have some family on the Arkansas side, and I’ve been to Eureka Springs and Branson. There’s a biannual publication called OzarksWatch that you might want to check out. Fascinating history and stories! Cincinnati is definitely a lot like St. Louis from what I’ve heard. I can see where it would be hard to leave Portland, which is ideal in so many ways–outside of COL!

Finke
Finke
2 years ago
Reply to  J.D. Roth

Covington would love to have you and Kim, JD! 🙂

Matt Bell
Matt Bell
2 years ago

Great article, JD. We moved from Chicago to Louisville in 2012 in order for me to accept a great job opportunity. Louisville was never on our radar screen, even as a place to visit. But it turns out it’s a great city with lots to do, better weather than Chicago, easier traffic, and a much lower cost of living. For a comparably priced home, our property taxes are less than half what we paid in Chicago. That has a huge impact on cash flow.

Kate
Kate
2 years ago

Well written, and I liked the interactive map. I also think it depends on the type of job/career you or others have in your home on where you end up living. Oftentimes I feel people who are on their way to FIRE work in flexible jobs, at home jobs, or other private jobs that they can change around. My husband and I work in education, and for us to move to a lower cost area would also mean a far lower salary. That’s something that isn’t mentioned when the idea comes up to just “move somewhere cheaper.” I would love… Read more »

GrowtoRetire
GrowtoRetire
2 years ago

The problem with choosing a place cheaper to live is that there’s a reason for the lower price. Or the neighborhood isn’t the ideal safe and stable place. Or is too far away from the center of the city/place that of work. What you save in money buying cheaper, you will spend more in transportation plus time loss in commuting. And time is money.

I prefer to consider a smaller place but near the center of my personal activity (workplace, gym, beach, and so on).

Bob Dennis
Bob Dennis
11 months ago

I spent most of my working life in California, much of that in Southern Cal. I loved it and would like to have stayed there. It fit my life style and values. But my Doctors told me it was time to retire. I now live about 10 miles south of Atlanta. So far, I can still afford to live here. I have Kaiser health insurance. There is not much ice and snow here. I hate the fact that Georgia is so conservative Republican. But I can afford to live here. I’m month away from eighty, but I can still afford… Read more »

Chris
Chris
8 months ago

Your commentary seems spot on but the map at Governing dot com is really skewed towards high tax-and-spend states and should really NOT be trusted. I am from Boston but moved to the less spendy mid-west. I have a good working knowledge of statistics, too (and a degree.) This site’s stats should not be taken at face value; It’s heavily skewed. Instead using an average income, they should have used a median number. Do your own research, governing dot com should not be taken at face value – More likely, it’s Blue State Porn.

Al
Al
6 months ago

I live in Seattle. It is not relatively cheap to live here. Unless you don’t care how safe the neighborhood or the commute is…the cost of living is very difficult here

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