How To Move To A Place With Lower Cost of Living

How To Move To A Place With Lower Cost of Living
Summary: Moving where the cost of living is lower can save you money, but there can be hidden expenses you don't expect. You will enjoy lower rent, reduced or low property tax and food prices, and much more. Here's how to plan ahead and make it smooth as possible.

Moving to a place where the cost of living is on the low side can save you more money, but there can sure be hidden costs you don’t plan for. Below is how to plan and ensure you win big when you compare your cost of living.

Most big cities certainly have the maximum of jobs, but they also have expensive rent. Know that, remote work is becoming a norm, moving to a cheaper place has become easier, and can bring in a lot of savings.

A lot of people have relocated from one state to another to benefit from the lower cost of living. This trend is likely to continue across the United States and the world.

That said, moving due to cost of living comparison is not all a sweet adventure. You will want to remember a few things when you decide to move to make sure it increases your financial savings as well as your emotional wellness.

So, for the rest of this guide, we will do our best to assist you in finding ways to reduce your cost of living and get to your financial goals with ease while moving.

How Living Cost Is Calculated

The median cost of living is calculated every year by several organizations, such as the Economic Policy Institute (EPI), the Council for Community and Economic Research (C2ER), and the Federal Reserve Bank of St. Louis. Even though they use a bit different methodologies, they mostly use the same factors to determine the cost of living in a given location, such as:  

  • Housing 
  • Food 
  • Child care
  • Transportation
  • Health care
  • Other necessities
  • Taxes

Organizations determine the cost of living by looking at prices for some sample goods and services, all of which are categorized as necessities for keeping an average lifestyle. These costs are totaled, averaged, and used to form indexes to assist in comparing various locations in the country.

You also can do the same for your specific lifestyle, and consider the amount of your budget that would be taken by certain categories every year. Luckily for you, many of these costs are controllable to a certain extent, even though they will possibly often be a part of your budget. If you want to cut your cost of living, your spending will be so much affected by these life changes.

Using best cost of living calculator makes it easier at a go.

Moving to an Affordable City with Lower Cost of Living

One of the biggest adjustments you can make to reduce your cost of living is to relocate to another place where those costs are just lower. For instance, even though taxes are always compulsory, you could move to a state that doesn’t charge income tax, like Texas, or one that doesn’t charge sales tax, such as Oregon. Yes, there is the cheapest state to live in.

Read our Guide To Find Cheapest States To Live In

Tips to Move to a Place with Lower Cost of Living

1. Plan a Move Controlled by the Cost of Living

If you can move, you might try moving to a location with a cheaper living cost. You can get better insights into what the total cost of living of a city might be, as well as other important factors that need to be considered such as utility, food, and housing costs; the job market, health care, and much more, using sites like Sterling’s Best Places.

Below are what to consider:  

  • Taxes: Tax differences between states (and international borders) can be overlooked easily when moving, but shouldn’t be, because they can significantly affect your bank account.
  • Income tax: Are you aware that there are states that don’t have a state income tax? (Remember that these states don’t relieve you from the federal tax). Seven states in the country don’t charge state tax, and Tennessee joins the team in 2021. Rates for those that charge state income tax vary. There are states like this; have a flat rate, while others have ranges. However, this doesn’t mean that moving to a state that doesn’t charge income tax or one with a flat rate is the best move financially.

Usually, if there is no income tax, there are many other taxes to bridge the gap, which can affect your total. Timing is also a major factor when you are filing your taxes; you may end up with a need to pay in two states for your first year of moving. If you moved to Vermont but are still in your New York-based job, you will possibly still pay income tax in New York. Several factors dictate which state you are responsible for paying taxes, read this breakdown and ensure you talk about it with an accountant if you are still confused.

  • Sales tax: There is no state income tax in the state of Washington, but they pay a sales tax of almost 9% in the highly populated counties. Whereas there is no sales tax in southern Oregon, but they charge state income tax (which varies depending on your income). If you know where you will be moving already, check the tax policies of the area. If you have more than one state or location inside states, it is important to research their taxes in the state city, and county levels to determine what that means for your wallet.
  • Extra taxes: Usually referred to as excise taxes, these are when cities and counties mandate extra taxes for funding certain needs. For instance, extra income tax is required by Portland of its residents to pay for public transport. A lot of cities and counties (like Seattle and King County in Washington) add extra sales tax.

2. Downsize and Downgrade

If you are bound by a job or other commitments, you could try to downsize into a smaller, affordable home in your location, especially if you feel hurt by our current mortgage payment. But remember that even there are costs associated with selling a home. As noted by Beatrice de Jong, a consumer trends expert at Opendoor, in guide to downsizing mistakes by Cheapism, there are other costs to be considered by sellers, such as cleaning, minor repairs, and touch-ups to get a home ready for market.

3. Follow a Tough Budget

This is another step you should consider when making effort to cut the cost of living. This will help monitor your spending habits, monthly income, as well as total financial situation. Aside from that, budgeting also with a guideline for each of your financial goals. It is just so critical for your savings. Though, you can’t just plan a budget once and expect it to perform any wonders in your life.

Rather, if you want to indeed see the advantages of budgeting perform wonders in your finances, you need to make it your everyday habit. Seriously, every day, you will compare your budget with your bank account, and ensure each expense tallies. This will keep you in control of your expenses, and your eyes wide open to areas where you can cut your spending.

4. Slash and Save

Whether your budget and income have been affected by COVID-19 at any moment, there are many ways you can begin to reduce expenses and live with reduced budget-related anxiety. From thoroughly drastic measures like selling your home and moving to steps that can begin to save money into your pockets now, below are steps you can take that could maximize your financial future:

  • Locate cheaper car insurance: If you feel like you are paying too much for your car insurance, then you may be right. So, be bold to shop around for inexpensive car insurance. Consider it this way; if you can cut your car insurance payment by just $10 per month, then you just save an extra $120 per annum. If you want to ensure you are receiving the best possible car insurance rate, we strongly recommend obtaining a quote comparison from Insurify. With Insurify, you can make a comparison of insurance rates, discounts, as well as payment options from several top providers within 1 – 2 minutes. Seriously, this online tool is one of my favorites.
  • Make extra income: These days, there are many ways to make extra income, from renting out a room in your home to taking a part-time job, to selling items on eBay, Craigslist, or Nextdoor with your professional skills, to starting a home-based partial income. As noted by the creator of LifeUpswing, Chris Panteli, to Cheapism, ‘you should surely have at least a side hustle fetching you extra income. This could mean online blogging; doing surveys, or working as a virtual assistant. The point is, having different streams of income better protects you from recession.
  • Get a roommate: Getting a roommate could be a better option for you and it might present you with better savings. For instance, in San Jose, the median rent for a 2-bedroom apartment is $3,567. Dividing that with a roommate is a better deal than paying $3,006 for a 1-bedroom apartment on your own. Sharing a 2-bedroom home could save you $14,670 per annum, and that doesn’t affect the amount you will save when you share household utilities.
  • Cut your energy consumption: While this is a small change to make, it can save you a huge amount. Knowing how to better manage your electricity usage could help save up to $500 per year with no huge sacrifices to make. The U.S. Department of Energy offers several energy-saving tips and strategies you can consider, such as:
  • Buy a programmable thermostat so you don’t heat or cool your house when you are away.
  • Understand peak and non-peak consumption rates from your electricity provider, and run energy-intensive appliances such as your dishwasher in non-peak times.
  • Upgrade to energy-saving appliances. Make sure you check for rebates offered in your state to help reduce the cost.
  • Be sure to seal and insulate your home appropriately so that your heat or cool atmosphere doesn’t escape through leaks and gaps.

How to Find Out if the Cost of Living Matches your Needs

First check your current and/or potential income, employment opportunities, and living needs. Also, you will need to check the housing market of the city, its quality of life as well as the cost of living against the national average. Don’t forget: while your income may cover you comfortably in one city, it may not do the same in another.

While a person making $60,000 per annum can afford a three-bedroom home in Raleigh, NC, they may have to go for a small, walk-use apartment (and many roommates) in New York City. If you believe that you will have more income when you move to New York City and that NYC is the best place to proceed with your career, then living in a smaller apartment short-term may finally be worth it.

Read What Is The Cost of Living In New York

Why you should choose to live in a City with a Cheaper Cost of Living

A lot of people discover that living in a city that has lower-than-average goods, services, and housing has more advantages to their long-term financial targets. After all, if you are spending thousands of dollars on rent each month, you will find it hard to save for the future.

Also, if real estate prices are too high, prepare to cut the size of your home. People residing in expensive cities may have to choose a farther location from the city center where housing is cheaper, which is capable of causing longer commute time to work and more stress.     


There you have it! It is possible to move to a place with lower cost of living with just a little adjustment and planning. When you decide where to move to, moving on budget is the starting point. How do you do that? By hiring the best affordable movers in the USA to handle your move, you will experience smooth move. Check the link to choose one from the experienced and licensed moving companies in the industry.