I’m getting ready to move across the country again. It’s not under the happiest of circumstances, and it’s not my first choice, but it’s the most practical thing for me to do, mostly because I’ll be moving to a place with a lower cost of living.
When you’re trying to live a frugal lifestyle, one of the best things you can do is pay attention to the cost of living, and attempt to live in a place with a lower cost of living. You’ll find it easier to save money when you consider location, since it’s often easier to make your dollars stretch in a place that doesn’t charge high prices for everything.
Smaller Income Doesn’t Always Mean Lower Disposable Income
One of the reasons that some people are reluctant to move to a place with a lower cost of living is due to the fact that incomes are often smaller as well. However, just because a smaller income is involved it doesn’t mean that your disposable income is lower.
If you’re living in an expensive city, you might have to pay 50% of your income each month on housing, and another 10% on food. That’s 60% of your income right there. If you are making $4,000 per month, that means that you spend $2,400 on housing and food, leaving you $1,600 for other costs.
Now consider living in an area with a lower cost of living. You can actually find housing that only takes 25% of your income and you spend 5% of your income on food. If you are making $2,500 a month in this town, you still end up keeping $1,750 for expenses other than housing and food.
This example isn’t far-fetched. I had a relative who experienced this difference when he moved from an expensive California city to a town in northern Utah. He had an extra $150 every month, and it was easier to save in other ways, too, since everything from entertainment to transportation was cheaper, and his state taxes were lower. In the end, he was able to live more comfortably on less than he did when he had a higher salary.
My decision to move to Idaho isn’t even going to come with a specific drop in income because I work from home. However, I am still experiencing a drop in household income, and I know that my situation will be easier to manage if I can move to an area that is less expensive. I want my dollars to go further, and I want to be able to travel and maintain my lifestyle. Moving to a less expensive place will allow me to achieve these goals.
Not everyone has the luxury of being able to choose when and where to move. However, if you have the chance to decide where you are going to live next, carefully weigh your decision. You might be surprised to discover that cost of living matters so much more than income, and that your frugal lifestyle is easier to maintain when your location isn’t constantly draining your budget with the cost of simple survival.
{ 0 comments… add one now }