Move Where Cost of Living Is Low
When living on a budget, there are circumstances where it might make sense to move to a location that makes living more affordable. Living in Manhattan, for example, can be a struggle for anyone earning under six figures of income each year. It’s possible, of course, but other areas of the country offer better housing options for the same amount of money.
There are trade-offs. New York City is a world-class metropolitan area, offering the best in art, music, food, and finance in this country. To take advantage of these benefits, if they are important to you, you’ll need to pay up to live here. The average home listing price in the TriBeCa neighborhood of the city is $4.2 million, and that’s not even the most expensive neighborhood.
Would you consider moving yourself and perhaps your family to better secure your financial future through lower costs of living?
A dual-income couple without kids and an AGI of $74,443 in Milwaukee can afford a median standard of living, according to the Tax Foundation report. That still puts the couple in the top 20 percent of taxpayers, giving them a tax liability of 8,081, or about 10.9 percent of their AGI (otherwise known as their effective tax rate).
To afford the same standard of living in Orange County, California, the couple would need an AGI of $100,079, putting them in the top 10 percent of taxpayers with a tax liability of $14,506. That represents 14.5 percent of their AGI.
And if they move to New York City, they’d need an AGI of $162,974, putting them in the top 3 percent of taxpayers and giving them a tax bill of $31,139, or 19.1 percent of their AGI.
Is this reason enough to convince people to move away from metropolitan regions like Los Angeles and New York? Perhaps it is for some people. There are benefits to living close to international hubs, including exposure to diverse culture, proximity to the best music, art, and food in the world, and large, close-knit communities and subcommunities. For some people, this is worth the extra expense.
If you want to move to the place where your dollars can make the most of your living, consider these areas:
- Brownsville, Texas
- Pueblo, Colorado
- Fort Hood, Texas
- Fort Smith, Arkansas
- Sherman, Texas
- Springfield, Illinois
- Waco, Texas
- Fayetteville, Arkansas
- Austin, Texas
- Springfield, Missouri