Before You Move, Consider Cost of Living…
We live in a highly mobile world. People move regularly for work or personal reasons between state or even International lines.
If you are considering a move this year to a different state within the U.S., it’s important to keep the cost of living in mind. In fact, Lifehack.org cites Washington, D.C., Hawaii, California, and New Jersey have the highest cost of living, while Mississippi, Alabama, Arkansas, and Missouri are the states with the lowest cost of living.
What is Cost of Living?
Cost of living relates to the prices of everyday items in different Geographic locations across the United States. Here are some of the key components of cost of living to consider as you make a move to a new home:
1 – Income Tax
While federal taxes remain at a consistent marginal rate, state income taxes vary from 0 to 13%. For instance there are a number of states they don’t have any income tax like Alaska, Florida, Nevada, South Dakota, Access, Washington State, And Wyoming, while California, Oregon, and Minnesota have the highest. Before you make a move from a low to highly taxed state, consider ways you can make up for the loss of income, like a higher salary or even signing bonus.
2 – Housing
Here’s another area that varies greatly. In some states, affordable housing may seem impossible to find, especially if you have an extensive list of must-have amenities. Whether you are buying or renting, check out websites like Realtor.com to see what’s within your budget.
3 – Healthcare
States vary greatly when it comes to cost and quality of healthcare. You heard that right — physicians, dentists, emergency care, and preventative-care specialists vary across state lines.
4 – Monthly Expenses
Monthly expenses like automotive gas, groceries, as well as utilities like gas, electric, water, and trash vary based on where you live. Even childcare falls into the category of monthly expenses and vary greatly. WalletHub has a good list of the most and least energy efficient states — check it out!
5 – Food, Entertainment, and Gas
Groceries, restaurants, entertainment venues, and gas is another category you should consider prior to the move.
6 – Moving Cost
While moving, it may seem like a no brainer that you’ll incur moving costs like storage, moving trucks, and more, not everyone knows this. You can use an online tool like QuoteRunner to estimate average costs. Here you can plug in your current zip code then your future zip code, and it will give you an estimated cost of moving from place to place.
Before you move, the elements above should weigh in your decision as you compare cost of living from state to state, or even city to city. There are even interactive cost of living calculators available so you don’t have to do the calculations on your own. In fact, Payscale.com offers a cost of living calculator. Simply enter the state you currently live, the state you are moving to, your annual salary, and your job title.
Owning a home is expensive. Stay in budget with these new homeowner tips from finance writer Michelle Schroeder-Gardner and H&R Block.
Learn more about military income taxes and get tax answers at H&R Block.
The startup tax or new business tax is a topic many new business owners shy away from. Our tax pros provide business tax tips so you don't get caught off-guard.
Be proactive and take control of your financial situations this year. H&R Block tax experts are sharing how to save more money in 2017 - learn more here.