There was a time when people would remain in their town of birth until their dying day. Today, that concept has changed as more adults see moving as an opportunity to enhance their lives. People move for better job opportunities, more affordable living, health, social interests, or closer to friends and family. While relocating can be beneficial, it’s not a decision to make lightly, especially when it comes to your finances.
The process of moving is expensive. More than that, where you move to can have a lasting impact on your finances. If you make an impulsive decision, you could find yourself in a position where you can’t afford the bare necessities, let alone luxuries and other expenditures. Ultimately, if you believe you’re ready to move, you must consider these financial factors first.
Cost Of Living
The cost of living is best defined as the average cost of living in a designated area. It’s an estimation of how much you will pay for things like housing, healthcare, taxes, food, and utilities. The cost of living isn’t the same in every city or state. For instance, someone living in Washington DC will pay 39% more than the national average. So, before deciding where you’d like to relocate to, research the cost of living average for the area and compare it to your income (or projected revenue if you don’t have a job).
The next consideration is how will you make money to keep the lights on, food in the fridge, and your home intact? If you’re moving far away from your current city or state, you’ll need to apply for a job. While it may seem as simple as completing applications, it’s a bit deeper than that.
Does the place you plan on moving to have a solid job market? Are there jobs that match your educational and professional experience? More importantly, what is the average salary, and is it enough to meet or exceed the average cost of living?
If you don’t ask these questions, you could end up moving to a city where you can’t find suitable work. Eventually, you won’t be able to afford what you need.
Here’s a financial consideration that most people overlook – sales tax. When sales tax is applied to products and services, it increases your out-of-pocket expenses. Ultimately, you want to end up in a place where the sales tax is low so that you can keep more money in your pocket.
Although housing is broadly covered in the cost of living average, you must dig deeper when deciding to move. While average rent in a particular area might be $1,500 a month, if you’re unable to find apartments or houses with rental rates that low, it’s impossible to keep up with the costs.
The same is true for people interested in owning a home. If you can’t find a house with an affordable mortgage, you’ll have to spend more each month for shelter. Do yourself a favor and analyze the housing market extensively. Ensure that there are apartments or houses available within your price range before making a move.
Lastly, you need to factor in moving costs. How much is it going to cost you to get from your current to your future residence? You’ll have to pay for a moving truck, movers, and packing supplies, which can quickly add up. Sure, there are ways to save on the cost of a move, but it may not be enough. If you can’t afford moving expenses, chances are you’re not prepared to relocate.
Whether you’re a college grad moving out of your parent’s house or a career professional chasing a job opportunity, relocating can enhance your quality of life. Be that as it may, moving comes at a cost. If you don’t have the financial means to cover everything, you’ll find yourself stranded without the resources you need to survive. Consequently, you end up having to relocate again. On the contrary, if you analyze the financial factors listed above, you can save yourself a lot of time, money, and stress and relocate without a hitch.