Do you feel like whenever you buy groceries or fill up the gas tank, it’s depleting your wallet? Well, you’re not alone. You face the harsh reality if you live in an expensive city like New York or Seattle. And you can’t really control inflation, interest rates, or tariffs. It’s a tough balancing act when so much is out of our control.
So, how do you rein in your daily living expenses while saving for your future? One idea you might be floating around is moving to a cheaper area. It could be as simple as moving to a new neighborhood. Or you may have set your sights on another city or rural town. If you’re bold, you may have thought about relocating to an entirely new country or continent where the language and culture are completely foreign to you.
On the surface, it could be a great financial move. Yet there could be lots of hidden costs that could creep up and quickly eat away at your savings. Let’s uncover the actual costs of moving to a more affordable area so you can prepare and plan appropriately.
The Reasons For Uprooting Your Life
Why should you pack your belongings and move in the first place? People have all sorts of reasons. Some individuals aspire to a lower cost of living. Or they need to move for school or work. Others just want a different pace of life. Perhaps in your younger years, you wanted to live the big city life with all the hustle and bustle. But now, maybe your mindset has changed, and you prefer a quieter, more peaceful life.
I know of some adventurous adults who have even adapted to van life. That’s where they retrofit a van or trailer into their humble abode. Having a mobile home gives them the freedom to travel wherever and whenever they want. But this type of lifestyle is not for everyone—it’s mainly suited for those who are more free-spirited and have the flexibility to be location-independent.
Using Geoarbitrage To Accelerate Your Wealth
Some people in the FI/RE (Financially Independent/Retire Early) movement use a popular strategy called geoarbitrage. This is where you move to a lower-cost-of-living area and maintain a high income. It works well if you have a cushy remote job or a thriving online business, so you’re not tied to any one location.
By using this strategy, you effectively reduce your daily living costs. As a result, it helps free up money. You can then use this freed-up cash and move it to a golden (a.k.a. retirement) nest egg. To be transparent, this strategy probably isn’t for you if you’re deeply involved in your community or if you struggle with a changing routine or adjusting to a new culture.
Moving Cost Considerations
Let me tell you, moving all your belongings isn’t cheap. I know from first-hand experience. I’ve had to move several times in the past decade, and there were so many costs I wasn’t expecting. According to moving.com, the average cost of a local move is $1,400, whereas the average cost of a long-distance move is $5,450 (assuming a distance of 1,000 miles).
What are the costs that you need to budget for when you’re relocating? First off, you’ll need moving boxes and supplies (like lots of packing tape and labels). Then, if you need to stage the home that you’re selling, you may need a storage locker to store your belongings for the time being.
Then you need to decide whether to rent a moving van and move all the boxes yourself or hire a professional moving company. Truth be told, the former option is more cost-effective than the latter. And what if you have a piano or heavy furniture? Well, be prepared to shell out extra cash for the movers to handle the valuable item with care.
What if you’re in a rush? If you’re moving across the country, it could take up to two weeks for your items to arrive. So, if you need expedited delivery, then that’ll be an extra cost too. Last but not least, if you feel you received exceptional service from the moving company, it’s a nice gesture to tip them.
Employment Opportunities Outlook
The reality is that cheaper cities have concessions. One area in particular is your career growth and income level. Ideally, if you have a remote job, you can move anywhere, and you don’t have to worry about looking for a new job. But for many people, they usually need to find new employment too.
Find out if one industry dominates a town (such as a manufacturing plant or a tourism destination), which is quite common in small rural towns in the United States. You want to ensure their industry is stable. Or else you could be laid off if something were to happen. For example, a government could apply restrictions on foreign travelers visiting a tourist area. As a result, this could negatively affect restaurants, accommodations, and attractions that rely heavily on tourists.
When looking for a job, ask yourself these questions:
- Is there room to advance up the career ladder or growth opportunities?
- Can you get a raise or bonus every year?
- Is this sector or industry growing?
- What kind of benefits does this job offer? Do they have a 401(k) plan or health benefits?
These are things workers may not consider that could have a huge impact on what they can afford. Don’t forget, many smaller towns have lower wages and less employment opportunities. If you’re self-employed, that may not be an issue at all. But if you’re looking for new work, be sure to understand what the job market is like beforehand.
More Affordable Housing
The biggest reason for moving from one place to another is being able to find a home to rent or buy that’s cheaper than your current home. You may recall this happening during the pandemic, when people wanted more space as they were forced to work from home while the kids attended virtual classes. So a lot of families decided to move to the suburbs to have more space.
When we look at the cheapest states to live in, there’s Texas, Missouri, Oklahoma, and Kansas, to name a few. But just because they’re more affordable doesn’t necessarily mean they offer comfortable living. Even though you can save a lot of money or afford a larger home when you move to a lower-cost area, you also need to consider other factors that will affect your lifestyle.
You can check out Bankrate’s Cost of Living calculator to compare daily living costs between two cities.
Modes of Transportation
When people move to rural areas or small towns, they often can find more affordable housing. But that comes with a tradeoff when trying to get around town. You see, when you move to the outskirts, public transportation may be limited. Going to the local bank or neighborhood grocery store isn’t within walking distance.
Even if you can bike to run errands or go to work, not all places have sunny weather year-round or even dedicated bike paths. Then you’re stuck driving the car, and we all know that maintaining a car can be very costly—especially when you factor in gas, parking, oil changes, maintenance, and repairs.
Of course, if you’re moving to an urban city, you’ll probably have lots of transportation options to choose from. You’ll likely be able to walk, bike, take an Uber, or subway to your destination. And you can take the car if your heart desires. So, take the time to imagine what your future lifestyle will be like and how you plan to go about your daily activities.
FAQ
What are the hidden costs of moving to a lower-cost area?
When people think of moving to a more affordable area, the biggest appeal is usually housing. Besides from that, there are other considerations such as transportation, employment opportunities, healthcare costs, and moving costs. Also, for those who have children, they’ll need to factor in education costs and kids’ activities.
How do I know if I can afford to move to a new area?
Try this simple exercise. Take your current household budget and create a new budget for the place you want to move to. That way, you can compare apples to apples and see if the numbers make sense. Reach out to a real estate agent in the area you’re researching to get a better idea of what the realistic costs will be.
Is the geoarbitrage strategy right for me?
If you’re willing to relocate to a cheaper city or country while maintaining a high income, geoarbritage could work in your favor. It can speed up your retirement savings goal. It could be suitable for digital nomads or those who adapt the laptop lifestyle. The challenges include learning an entirely new language or understanding a different culture.
How much should I realistically budget for moving costs?
Moving can easily cost you thousands of dollars. The farther the distance, the more expensive it will be because of fuel and labor. You can save tons of money if you pack your own boxes, move your furniture, and rent a moving truck. Ask your friends to help you on your moving day and reward them with free pizza and drinks afterward. If you can’t DIY it, you can hire a professional moving company to do the heavy lifting. Research and compare several quotes so you know you’re getting a good deal.
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Sources:
- https://www.investopedia.com/the-hottest-cities-for-transplants-and-what-that-means-for-your-cost-of-living-1775758386437-11946747
- https://www.aol.com/articles/why-moving-low-cost-living-155932787.html
- https://www.unitedvanlines.com/moving-tips/blog/cost-of-living-affordability-and-moving-trends
- https://www.unitedvanlines.com/newsroom/2025-national-movers-study
- https://addicted2success.com/lifestyle/finances/this-move-can-help-you-keep-more-of-your-income/
- https://medium.com/at-the-minimum/the-harsh-reality-of-moving-somewhere-cheaper-89c8f04b49a5
- https://www.iwillteachyoutoberich.com/geoarbitrage/
- https://finance.yahoo.com/news/10-most-expensive-cities-achieve-130201380.html
- https://www.fool.com/retirement/relocation/cheapest-states-to-retire/
