Yahoo Finance Moving To a Low-Cost-of-Living City Saved Me $1,500 a Month — Should You Move Too?
If you’re stuck in financial quicksand and feel like you can never get ahead no matter how hard you try, your location — not your habits — might be holding you back.
Find Out: How Much Money Do Americans Have in their Bank Accounts in 2024?
More: Use This Checklist To See Whether Your Bank is Costing You a Lot of Money
Moving from an expensive city to an affordable one allowed Riley Annen, a real estate investor who works with a firm called Companies That Buy Houses, to slash her spending dramatically and build the wealth she used to launch her business.
“I relocated from the bustling streets of New York City to the serene embrace of Asheville, North Carolina,” she said. “It was a profound transformation.”
Here’s how she saved money moving to a more affordable city.
Sponsored: Owe the IRS $10K or more? Schedule a FREE consultation to see if you qualify for tax relief.
Reduced Housing Costs Alone Put Lots of Extra Money in the Bank
Overall, the move allowed Annen to recoup one dollar in five from her $7,500 monthly budget.
“In tangible terms, the move translated into a staggering monthly saving of $1,500,” she said. “The key catalyst? Redefining my living space.”
With an average home price of nearly $454,000, Asheville isn’t exactly cheap. But compared to the Big Apple, where the average home costs $734,000 and the average renter pays $3,661 per month for a 606-square-foot one-bedroom, the North Carolina mountain town is a low-cost-of-living paradise.
“Transitioning from a high-rise apartment in New York City to a cozier home in Asheville freed up funds, redirecting a significant 20% of my income toward savings and investments,” said Annen. “Unpacking the numbers, the housing cost contrast between the two cities was monumental.”
Next: 7 Safest and Cheapest Cities To Live in Florida
Expensive Cities Nibble at Your Bank Account With Everything You Buy
In cities where housing is unaffordable, everything else tends to cost more, too. Annen said that lower housing costs accounted for a little more than half the money she saved by moving to Asheville. The other half came from escaping inflated prices for everything from utilities and transportation to health care, food, entertainment, merchandise and services.
According to AreaVibes, the overall cost of living in Asheville is 3% higher than the national average, mostly because of housing, health care and utilities. Groceries, transportation and goods and services are all a little cheaper.
But compared to New York, it’s a bargain.
In the Big Apple, goods and services — all the stuff you buy and have people do for you — are 10% more expensive than the national average. Transportation is 12% higher, utilities are 13% higher and housing is a whopping 134% higher. In all, day-to-day life in New York costs 46% more than in the country as a whole and 43% more than in Asheville.
‘Financial Force Multiplier’: Every Dollar Saved Can Be a Dollar Invested
Annen mentioned that she redirected the 20% she saved on housing and living costs to her savings and investments — and that’s the real power of moving to a low-cost city. When you give less to the landlord, grocery store, gutter cleaning service and local pizza shop, you have more to build a future for yourself.
“The shift not only slashed my monthly expenses but also acted as a financial force multiplier, amplifying my investment capabilities,” said Annen. “What’s intriguing is how each dollar saved unfolded into a cascade of financial opportunities.”
When Annen left behind her unaffordable city, she also ditched the crushing stress of living in a state of check-to-check financial insecurity.
“Beyond the figures, this journey epitomizes a lifestyle alignment with personal and financial aspirations,” she said. “A nuanced approach, like trimming down dining-out expenses in Asheville while exploring local culinary gems, added both spice to life and substance to my savings. The meticulous strategy wasn’t just about numbers. It was about curating a life that echoes with purpose.”
The Cost of Moving vs. the Savings of Relocating
As Annen’s story shows, you can dramatically slash your monthly bills by moving to a more affordable city — but getting there will cost you.
According to U.S. News Real Estate, you should prepare to spend between $2,500 and $5,000 on a full cross-country move — but that’s the high end. If you’re moving regionally, it should be much less.
Selling your house isn’t cheap, either.
According to Rocket Homes, the average seller shells out 10% of the sale price. If your home sells for $300,000, prepare to cough up $30,000 in fees and costs. On the other side of the move, anyone planning to buy must prepare for big expenses associated with their new home purchase — about 2% to 6% of the purchase price, in most cases.
Even if you’re renting, you’re not off the hook, and expenses go far beyond the monthly payment for the lease.
According to Wells Fargo, you should budget for:
Application fees: $25-$50
Security deposit: Usually two months rent
Utilities: Varies
Pet fees: $200-$500 per pet
Parking fees: Varies
Maintenance fees: Varies
Renter’s insurance: $15-$30 per month
Affordable Cities To Consider
Annen’s experience is not necessarily typical — she moved from one of the most notoriously unaffordable cities in the world. But while you might not be escaping from New York, you can also find a much cheaper destination than Asheville — but keep in mind that cost is only one consideration.
You’re not doing yourself any favors by moving to an inexpensive city suffering from high crime rates, population loss, economic stagnation and depreciating home values. The good news is that there are plenty of compromise cities across the country. According to Forbes, these are the five most desirable and livable but low-cost cities in America, and GOBankingRates dug up the numbers to prove it:
Sioux Falls, South Dakota
Average home price: $308,478
Cost of living: 11% below the national average
Springfield, Illinois
Average home price: $143,710
Cost of living: 13% below the national average
Wichita, Kansas
Average home price: $181,958
Cost of living: 10% below the national average
Oklahoma City
Average home price: $224,198
Cost of living: 14% below the national average
Des Moines
Average home price: $189,912
Cost of living: 14% below the national average
Note: All home values are from Zillow and cost-of-living data is from AreaVibes.
More From GOBankingRates
This article originally appeared on GOBankingRates.com: Moving To a Low-Cost-of-Living City Saved Me $1,500 a Month — Should You Move Too?
