we've learned

Big City Vs. Small Town // Which Is Better for Saving for Early Retirement?

If we were superheroes, and our superpower was retiring early, our origin story would read a little something like:

Mark and Tanja were leading ordinary lives as consumers in Los Angeles when they came upon an artifact from a lost civilization, which bestowed upon them the knowledge that they must change their ways, move to Tahoe and save most of their income to earn their superpowers. Their secret identities — Mr. and Ms. ONL — were born. Motivated by a desire to sleep in, to shred pow and to spread a little good in the world, they meticulously tracked their saving, and unleashed their story on the virtual world of the internet within their emoji-masked disguise, fearing they’d be found out too soon. But finally, the day came when they could drop all the secrecy and live openly with their superpowers.

(I’m positive my actual superhero origin story would be more mutant-based, but that doesn’t come with the same aha moment. So it was either aliens or ancient civilization, and since I recently watched some old Legends of the Hidden Temple, I’m picturing Olmec bestowing the secret on us.)

If you choose to put yourself out there in public with your early retirement story, you find yourself repeating this origin story a lot, perhaps minus the supernatural forces and special powers. And when I tell our story on podcasts or to journalists, this moment happens often:

Someone else (SE): So you said you were living in LA when you started saving. Do you not live there now?

Me: No. We moved to Tahoe when we decided to pursue a different kind of life.

SE: OHHHHH. So that’s why you were able to do it. Because you left an expensive city, and moved to a small town, which I as a big city person assume must mean that the cost of living there is zero, but also that there’s somehow no loss of economic opportunities. (Ed. note: This is only a slight exaggeration.) 

Me: Uh, yeah, not really…

In the past when I’ve talked about city vs. small place saving and retiring, I always had to be vague about where we were, and just talk about our “expensive ski town.” But now I’ll share a bit more. Generally, rankings of cost of living only look at large urban areas, so expensive small places like Vail and Aspen in Colorado and Jackson Hole in Wyoming almost never show up on the list. But when small places are included, here’s where we rank:

Above Washington, D.C. Above OC. Above LA, where we moved from, which isn’t even top 10. (Or it wasn’t when this ranking came out, which is obviously a few years ago given that San Francisco isn’t #1. I’m sure other things have shifted, too.)

Don’t feel too bad for us. We can get this view anytime we want.

LakeTahoe-SecretCove

And this one.

tallac-annotated

And this one, too. 

IMG_2826

Paying the premium to live here is a choice we willingly and deliberately make, and we feel super grateful that we can manage it, especially given how many people struggle to make ends meet here. According to Sperling’s best places, which ranks cost of living almost everywhere, we’re currently at a COL index of 172, 72 percent higher than the national average, though our old zip code in LA is around 200, so it’s true that where we live now costs slightly less than where we left, mainly thanks to skyrocketing home prices in the big cities. (Reminding anyone else of 2007? I hope I’m wrong.)

But the point isn’t about the rankings per se. It’s about the fact that the origin story of “left the city for a small town” doesn’t automatically mean that you’re able to save more, even if that’s what lots of people’s knee-jerk reactions will lead them to believe. Just as staying in an expensive city doesn’t mean you can’t save quickly, despite those high housing prices. (And a lot like how people tend to think in terms of “high tax states” and “low tax states,” but we actually come out ahead living in “high-tax” California. Ignore the conventional wisdom and take your own look!)

So let’s take a look at exactly this question: what your choice of where to live will do to help or hurt your journey to early retirement.

Small Town Vs. Big City -- Which is better for saving for early retirement? Our Next Life -- financial independence, early retirement, adventure, happiness
 

City Vs. Small Town — Early Retirement Savings Potential

Cost of living indices are helpful for making choices about where to move, but once you live in a place already, they may or may not reflect your actual life. Current housing prices in particular are weighted heavily in most indices, but if you own your home and bought it prior to the current market frenzy, or if you have a rent-controlled home, then the housing index of a place isn’t relevant to you unless you decide to move. In that case, what really dictates your cost of living is all the rest — food, transportation, utilities, entertainment, along with the all-important earnings potential. The flip-side is that if you do need to find a place to live in the current economy, all the frugal ninja-ing in the world won’t let you save as much as you might be able to with lower housing prices. But let’s break down each factor.

Economic opportunities — I know that there are folks who like to talk about how no one needs to go to college anymore and can instead learn from Code Academy, and that opportunities are everywhere, but the data tell a different story. Bureau of Labor Statistics data show that the vast majority of workers still have traditional jobs, not gig economy jobs, and that there are huge gaps in income and opportunity between those with and without a college. Which is pertinent to this discussion because of the large divides in what education-level jobs are available in each state. States with a high percentage of jobs that don’t require a college degree or even a high school diploma are largely comprised of rural areas, small towns and small cities. (Our neighbor Nevada seems to be the exception, but only because of Las Vegas. Otherwise it’s a heavily rural state.) This divide is worsening, as whole cities gentrify with rising wages and home prices. So for those who can afford to live in a big city, economic analysis of real wages adjusted for cost of living shows that you do, in fact, come out ahead income-wise in the biggest cities.

In our case: The big vs. small debate never boiled down to earnings potential for us. We had the crazy luck of being able to take our jobs with us, something I can’t teach you to replicate. My office closed around me during the Great Recession, and as the last woman standing, I got to keep my job while losing my office. Taking our city salaries with us to a small town absolutely made the choice much easier.

Transportation costs — In the biggest cities, you may not need a car. (Though tell that to anyone living in LA.) Your commute is likely to be shorter than that of someone coming from the suburbs. You may be able to walk or bike to work if you can’t take public transit. But if you do drive, you may face steep parking charges and higher car insurance rates. In a small town, you likely need a car to get around, or maybe just a bike if you’re hardcore. It’s highly dependent on place, but you may or may not be able to walk anywhere. And you generally have fewer options of ways to get around. The people we know with the highest transportation costs tend to be those who live in distant suburbs and commute to an urban core, and folks living in the small towns or in those urban cores may have high or low costs depending on their circumstances and choices.

In our case: We had one car in LA because Mark worked at home the whole time he lived there, and we lived in walkable neighborhoods where we wasn’t stranded at home while I was off working. But walkable isn’t really a thing in the mountains, and so we needed to add a second car when we moved to Tahoe. And yet, despite adding a car, our month-to-month transportation expenses went down, owing largely to lower auto insurance premiums up here. Consider this: we went from a single, economical car and a smallish condo in LA, to a freestanding house twice the size in Tahoe (still earthquake country, by the way, plus wildfire country) with that same economical car plus a newer, bigger car, and our insurance premiums went down. Car insurance in LA is crazy expensive, because you’re more likely to hit a Ferrari than a Ford Focus. That is something we do not miss! 

Free things to do — The truth is: there are free things to do everywhere. You might need to know where to look, but you can always find them. And in cities, because you just generally have more or everything, you tend to have more free stuff. But you might also have more people wanting to get in on that free stuff, making it less fun or even less possible to attend. If you’re fine hobnobbing with crowds and doing your homework, you can often spend very little to entertain yourself in big cities.

In our case: When we lived in LA, Mark played beach volleyball — entirely for free — all the time. Here in Tahoe, he plays rec league volleyball which costs money, and plays a bit of beach volleyball (still free). But we tend to do much more of the free stuff here, just because there’s less to do generally. In LA, and in DC before that, there were plenty of free things to do but also lots of tempting paid things. And we often went for the paid stuff. With fewer options here, the free stuff rises to the top much more often. And that’s not even talking about the vast network of free trails and free waterways that we now have access to, which is what drew us up here in the first place. 

IMG_0552

Everything down there is free to explore

Prices in general — If someone can come up with a unified theory of consumer prices by geography, please let me know and I’ll share it here, because this one completely befuddles me. I’ve often complained about the “mountain tax” that we pay on everything from groceries to gas prices, but I haven’t shared this set of details: We are less than an hour from the richest agricultural region in the country. We are only a few hours more from a high concentration of oil refineries and one of the world’s busiest ports. We sit right on a major rail line and a major cross-country interstate highway. All of those factors should make our prices cheaper, but instead we pay some of the highest prices in the country for gas, groceries and utilities. And after the trucks and trains pass through here, they continue on into Nevada and Utah where — miraculously! — the prices on those items they were transporting drop to far more reasonable prices. Our workers aren’t getting paid more here. The costs of doing business aren’t higher. So the only thing explaining the mountain tax is some odd formulation of supply and demand. And that’s something that sellers can exploit much more in small towns than they can in big cities. In LA, we could get an electrician or plumber any time for less than $100 an hour because there was more price competition. Here, if we can even get one to come out, we’re paying double or triple that, because there’s so much less competition. Plenty of small towns have low prices, of course, but it’s certainly not a given.

In our case: We now don’t spend much more on general products than we did in LA, but that’s only because we keep our house super cold in the winter, and because we do a lot of our grocery shopping on the other side of the mountains in Reno, where everything costs far less. 

Social opportunities — Think of it like this: does it cost money to spend time with your friends? In big cities where homes are smaller, people are far more likely to meet out for drinks or a meal, where there’s a higher cost associated with that encounter. It’s why there are so many restaurants in Tokyo, because no one has space to entertain. In smaller places where you have a little room to spread out, it’s easy to have people over. And you have fewer places to go out, which might make that idea less tempting. As with all of these things, it’s locality-specific, but the trend of going out to socialize versus inviting people in plays out in urban and rural areas around the world.

In our case: We for sure invited people over in LA, but most often seeing people meant dropping legit cash to go out. Here, we can have people over, or make outdoorsy adventures more social. Sure, I could have gone on urban hikes with friends in LA, but when you each have to spent an hour in traffic to do that, it’s a lot less appealing. 

Diversity and culture — This one isn’t directly a cost or savings question, but it’s important to include in a discussion of big vs. small places. Big cities tend to be much more diverse and full of different cultures than small places are. There are exceptions, of course, but the trend is clear.

In our case: Tahoe is super white. It’s our least favorite thing about it, by far. We miss the cultural vibrancy of LA, and we wish this was a trade-off that didn’t come along with mountain living. But from a financial perspective, fewer cultural events means fewer occasions to spend money, which is a big stretch of an upside. 

Temptation to spend — I saved the biggest one for last. It boils down to: do you live in a place that tempts you to spend more money or less money? If you live in San Francisco and are passing cool shops every day on your way to work, you might feel much more tempted than in a small town where the shops are less plentiful and far less cool. If you’re a foodie, surrounding yourself with interesting restaurants will be a bigger temptation than living in a small place where you’re forced to cook many of the foods you want to try. It’s all about what your biggest spending temptations are.

In our case: I spent a lot in LA. Not on a ton of stuff, because I have never been interested in designer products. But on coffee, juice, restaurant food, and wine. Mark spent a bit, too — takeout coffee every day, y’all — but since he was mostly at home, he was out and about less. Still, takeout dinner was a regular event, and a popular weekend activity was walking down to the wine shop. (We still have a lot of that wine, by the way. Our eyes were much bigger than our stomachs.) Here, I’m way less tempted by everything, and it helps that we can’t walk to a single place where we can spend money. If I truly want to buy something, I have to get on my bike and commit to a real ride or get in the car. I think, though, that Mark may be a bit more tempted to spend here, because of all the outdoors opportunities. While we aren’t buying so many little upgrades to our camping setup, we’ve each bought multiple pairs of skis and multiple bikes since living here, with Mark leading that charge. So while we’ve gotten the restaurant spending in check, we each have a different response to the move when it comes to spending temptation. 

Conclusion

At our Manhattan meetup last month, we met a cool couple who had recently moved from Twin Cities, Minnesota (COL index 109), to the Upper East Side (COL index 261), and they reported how thrilled they are that they are spending less and saving more now — IN NEW YORK CITY — than they used to in Minneapolis. They get paid New York salaries, they no longer need cars, there’s tons of free stuff to do and they aren’t finding themselves as tempted as I would be by all the restaurants and cultural events that surround them. Which isn’t to say that the big city is automatically the way to go. Manhattan is a uniquely transit-heavy place, with no other equal in the U.S. The New York Times‘ analysis shows that leaving the city for the suburbs generally ends up costing people more, which may not be true in every big metro area. And you might just be super tempted by all that retail, all the cultural events that cost big bucks (concerts! Broadway! the ballet!) and all that glorious food that’s available until the wee hours. But it is to say that the cost of living index isn’t everything, or even close to everything, and the way you live plays a huge role in your ability to save for early retirement.

Your turn!

Weigh in! Do you live in a big city, a small city, a small town or a rural area? Was your ability to save part of your decision to live there? Do you wish you could switch to a different place to speed your journey? Have you actively taken steps to move to speed your journey? Let’s talk big vs. small in the comments!

Want extra Our Next Life content? Get the e-newsletter!

Onls profile6 closeweb

Subscribe to get our periodic newsletter with tons of top secret, behind-the-scenes info we'll never share here on the blog.

No spam or slimy sales pitches ever. Unsubscribe any time -- no worries! Powered by ConvertKit

30 replies »

  1. Great topic (as usual). I moved from Washington, D.C. (crazy expensive) to Portland, Maine — much smaller and much less expensive. Interestingly, I pay only a little less for rent, but the same money that bought a studio apartment in DC buys a very large two-bedroom apartment in Portland. Since Portland is almost completely walkable, my Uber expenses have dropped to almost nothing, and since there’s a fitness center in my apartment building, I no longer have to pay for a gym membership. Groceries and eating out are my two biggest expenses. I moved here on 31 March and retired on 27 April, so I’m still getting a handle on what my typical monthly spend will be, but those are my initial observations. Looking forward to hearing others’ experiences (and to meeting some of y’all in Denver in October!).

  2. This is so true. We moved to manhattan from the suburbs as a family of 5 and are able to save. Salaries are higher here for many jobs. Public schools are good, tons of free stuff for kids (and adults) and universal pre-K in the city means fewer years of paying for day care. Smaller apartments mean less $ for furniture and less temptation to buy stuff. Public transit is good and I am able to walk to work. It’s not for everyone but works for us

  3. This post was worth it for the Legends of the Hidden Temple reference! I know what I’m doing later today. ;)

    My husband and I used to live in Chicago, and now we live in a smaller, Southern, university-city. When I started interviewing down here and pitched a salary, the HR rep told me how much cheaper it is to live in this area and that I shouldn’t expect “big city salaries.” Cost of living is lower here in terms of gas prices and some groceries, but we spend more on some things, especially gas, because stores, activities, and friends are more spread out, which drives up the transportation costs. I would honestly say it’s a wash in terms of day-to-day expenses, which is what I pointed out to that HR woman.

    Where we spend less money is on eating out and entertainment. The restaurant spending might have evolved naturally as we got better at cooking and more determined to save money by not eating out as much, but the entertainment component is one of the pieces we dislike the most about where we live. We both trained in classical music, and my husband still works as a professional musician. Our area is strikingly devoid of arts and music culture, and the opportunities we do have we consider to be too expensive for the quality of production.

    Eventually, we’d like to move closer to a bigger metropolitan area to have more access to those cultural activities that are important to both of us. However, there’s a chance I might be able to move into remote, higher-paying work in the future, and in that case, we have discussed the possibility of staying put for several years in order to maximize our savings.

  4. I think living in our little mountain town near Vail, CO helped us reach FI. Most importantly, places like this attract like minded people-people who are willing to pay a bit more for life’s necessities to have access to amazing skiing, hiking, biking, camping etc. These also tend to be people who don’t shop as a hobby, aren’t concerned about what others have or drive and are always up for a potluck rather than a dinner out.

    It’s a great place to make a life if you can make a living and we were fortunate to make a good living. Being debt free other than our mortgage when we moved here helped a ton and we bought in to the real estate market before it got too crazy.

    Living here made me happier than Denver and happy me just spends less money.

    • This has basically been our experience, too. We moved from San Francisco to Reno, but we kept basically the same salaries and the same monthly housing costs (the mortgage on our 2/1 house in Reno is roughly equal to the rent on our 2/1 apartment in San Francisco, though of course we’ll own the house eventually). The biggest changes we saw were social costs—in SF, getting together with friends on a weeknight meant spending $100 on dinner out, while in Reno, it means spending $10 on a six pack to bring to someone’s house. We also spend so much less on recreation while doing much more of it, since we’re right at the base of the mountains we used to have to drive 3-4 hours to get to.

  5. We live in a small town (19,000ish people) and feel very fortunate to have both stumbled into pretty niche jobs that also yield us high paying salaries. My company, specifically, is based out of San Francisco, but my hub is located in this small town. Regardless of this, they still pay us a comparable rate to the same city folk. It’s really a lucky break for me. My husband is the only person with his skill set in the area, so he’s also able to dictate his pay to a degree. While i realize this is very fortunate for us and perhaps not replicable, it’s worth mentioning. High pay but lower cost of living (compared to Bay Area prices), has allowed us to pay off our house and also save for retirement. I feel much less pressure to keep up with the Jones’s in a small, working class town because, honestly, people here arent really buying like crazy. Limiting my social media exposure also helps curb this, so we keep spending down. Being a farming community, there are often small free farm events the kids really love. I’m hooked!

  6. When we moved from Southern Oregon to the Boston suburbs, we joked that everything was twice as expensive in Boston, except for a couple of things — which were six-times as expensive! The pay was higher in the Boston area, so they whole thing felt like a wash.

    However, when you compare saving x% of pay in Southern Oregon to saving the same x% in Boston, the dollar value of savings in Boston was nearly 2x the savings in Oregon. The peer pressure to live large what much higher in Boston, but if you resisted that pressure, you could save much more money in the expensive city with the higher average paychecks.

    Here’s what I learned: If you live in an expensive city and save a big portion of your pay, you can retire earlier and anywhere. If you do the same in a low cost/low pay area, you will need to retire in a low cost area.

  7. We live in one of the medium-expensive parts of the greater SF bay area (not SF or Silicon Valley), but not one of the further out less expensive areas. We decided to live here based on career opportunities – savings rate didn’t play a role other than “can we afford to live there comfortably?” I’m super glad we didn’t end up in silicon valley, where the problem is even worse.

    I occasionally browse redfin in Tahoe (and a few colorado mountain towns). The savings on housing is dramatic, even though no one could call Tahoe’s housing cheap! If the timing works out, it would be fine to do the accumulation phase in my expensive housing market, assuming we could cash out at a good time and move somewhere with cheaper housing. But that is betting on real estate timing working. It would be difficult for us to do an accumulation phase in a very cheap place due to our jobs, but there would be options. We aren’t really looking into them though.

    My current goal is to save enough to be able to retire here eventually, but the high cost of housing pushes the goal posts way out.

  8. I’ve always moved to cities for the job opportunities. Post-college, I had job offers in the town I grew up in, but I had a feeling that if I took those jobs, I’d probably be stuck doing them for a long while. There simply were not many opportunities in a small town. I’m very lucky I was able to save up and move away. I’m not against living in a smaller city or town, but I do struggle figuring out what my job would actually be. My industry, and my husband’s, are both pretty NYC-centric. We aren’t programmers or doctors or lawyers who have jobs that aren’t location-specific.

  9. As someone who moved to a small town post college (thanks to the military we didn’t have a choice on location), I found out exactly how hard it is to find a good job if your skill set isn’t in the small section of opportunities in that small town. Cost of living may have been way less, but my income was SIGNIFICANTLY depressed due to location and my specialty. That said, if we could pick up and telecommute from there with our current jobs (we can’t), we would be way ahead. We visited last month for the first time since moving away and we were floored at how cheap everything was – but it sure didn’t feel like it when we were living there.

  10. I feel bad for you because that view comes with 92% chance that you’ll end up like Toonces :-(. I’ve never driven in another place that’s as scary as Truckee. I’d love to see you post some pictures of the roads in the winter.

    As for the plumber thing, I have a friend who is a landlord in the San Fran area. The cost of labor for an electrician or plumber sounds familiar. It’s crazy… but everyone has to make a living.

  11. Your point about small towns being expensive but generally omitted from these lists is spot on, especially outdoor recreation towns. Park City, Jackson, Vail, Steamboat Springs, Big Sky, Whitefish, Truckee etc, are generally expensive and could be no different than a big city (depending on personal spending habits). I think the lesson to be learned here is that people need to choose a place, big city or small town, that would give you the best bang for your buck to obtain/maintain ones FIRE approach. There’s free and expensive activities no matter where you live. Think it through for your own situation and choose wisely.

    I find it helpful to think about it in phases: Phase 1, where can I save the most in working years while still enjoying life and Phase 2, where can I ‘live’ the most in FIRE years. Those very well could be two completely different places and differ from person to person.

  12. Very cool breakdown! We moved from Manhattan to Seattle and it cut our time to retirement in half :) (from 10 years to 5). We wanted to leave Manhattan because of the crazy housing costs: we were paying $2,750 for a 400 sq ft studio 3 years ago – I checked recently and they’re now asking for $3,250. In Seattle we pay $1,650 for a top floor, corner unit 1 bedroom that’s walking distance from work and Pike’s Place. Our main criteria for picking a new city were what it would do for our savings rate (Seattle has Manhattan salaries and almost 1/2 the COL in our experience), walkability (my partner has never even had a driver’s license and after I grew up in Atlanta traffic I vowed to never own a car), natural beauty, and weather (it’s a lot more temperate here instead of freezing NYC winters). So far I’m loving it!

  13. It’s not a straightforward city = expensive, small town = cheap argument, and this lays that out so well!

    The link for the COL index is super fascinating, thank you! I looked up my zip and it’s 169, ouch (my hometown is 90 so at least my parents made a smart choice!). I’m not making the salary I could be given that I live here. But then again I’ve got the rest of the benefits of a big city here (free museums!!!!!!) and my neighborhood is fantastically walkable, so those factors plus frugal living in general help offset the fact that my salary isn’t currently boosted by the HCOL city. I doubt I’d have quite the same perks if I moved to a smaller, less expensive city.

  14. I grew up in Baltimore and ended up outside od DC, so I went from a big city on the cheaper side to one of the most expensive. But I could have never earned the salary I earn in DC back in Baltimore, so the move accelerated my savings tremendously.

    That said, I want to experience small town life – mostly for the access to outdoors (without crippling traffic), and the solitude. I’ve been to your town before and hiked across Northern Cali, it’s gorgeous. With plenty to do in all 4 seasons. I’m dreaming of that kind of life :)

    As for groceries etc being more expensive in Tahoe, could it be that the rent and/or property taxes for the businesses is so high that they just pass it off to you?

  15. Very interesting. I live outside a small town and it is very inexpensive. My nearly 3000 sq ft house with four bedrooms and bathrooms and two acre yard is worth at most about $200k. My commute to work was never more than eight minutes and my pay was much higher than the median pay in any of North America’s most expensive cities. It was duck soup to become financially independent, for one thing eating out frequently isn’t even a thing when you’ve only got a couple of decent restaurants available and you’ve already memorized their menus. I honestly think small “cheap” town living is the easiest way to become wealthy if you can manage to have a high earning career like I did.

  16. We live in a suburb of Chicago. Everyone assumes that the Midwest is very affordable. It’s definitely not Silicon Valley expensive, but I think people would be shocked to know how costly things are. We live here by design. Primarily, it’s to be close to family. They help with our son now, and we help with them as they age (and will do more of this as time progresses). But also because in our professions, our income is directly tied to cost of living. Everyone who suggests my husband and I move to a low COL area in Illinois misses the point with how teacher salaries are created. (I used your comparison COL calculator. You’re 18% more expensive than us!)

  17. I’m in London, UK and I really believe that living in a big city is worth it – while there is no doubt some things are mega expensive, and the city does cater for the oligarchs and billionaires, there is also so much for people of more moderate means as well. So many free museums, galleries and festivals. And you can see world class theatre and opera from the cheap seats for reasonable prices.

  18. It’s been so insightful reading this post and the comments: I never would have guessed that “expensive” cities would come out cheaper for so many FIers! We live in a suburb of Houston. Design and weather make cars pretty necessary in this part of Texas, but fortunately, many of the businesses have moved closer to the suburbs, so workers can take advantage of better housing prices and good public schools without getting completely pummeled by the commute. It’s a good place for saving and incredible in terms of cultural opportunities and diversity, but I’m looking for a more outdoorsy, walkable, temperate locale for early retirement.

  19. Fantastic writing Tanja!

    We live in the DFW area but have moved to the outskirts on the north west end. The property is definitely less expensive and as that is generally the largest item in a person’s budget, it makes sense for us (especially with an expensive property tax burden).

    Part of this decision is based on have 4 young children and not wanting to squeeze into an apartment. Ultimately, we are grateful to be able to live a bit outside of the metroplex as it does allow us to save a bit more.

    But I think the biggest point you make is that you shouldn’t assume that a more remote or “smaller” area is going to be less expensive. Folks need to run their numbers and do the adequate amount of research for an important decision.

  20. While I get the concept of moving to a lower cost of living area to reach FI faster in theory, I don’t really get it in practice. Maybe it’s because we’re on the older end of the FIRE train and will be more FI rather than RE, since he’ll be 60 and I’ll be 51 when we retire. But family and being close enough to take care of aging parents rather than cost of living was the biggest factor in our decision on where to live. And then we worked our FI plans around that. And maybe it’s because the FIRE community is younger than us in general that those factors haven’t come into play yet. I lived on the west coast for 5 years in my early 30’s before a) learning about FIRE and b) before any sort of consideration for family obligations (?) were even part of my decision making process for where to make our permanent home.

    We lived in the NoVA/DC area for about 4 years prior to making the permanent move to Suburban Philadelphia (COL 117). I was able to take my job with me but my husband took a 35% pay cut in the move. I think that if we had bought a house in VA we would have been able to reach FI sooner due to the pay, but we would have been miserable due to the horrendous traffic, and the hubster hated his job there with a burning passion. We’re now in closer proximity to my family and the same distance from his mom, with plans to move her here when she can no longer physically care for herself. Our house is bounded by the Schuylkill River and the Schuylkill River Bike trail on either side, which gives us serious free opportunities for entertainment. And my husband likes his job. So I guess it is taking longer for us to get to FI. But we’re on a more rewarding journey than we’d otherwise have been.

  21. I looooove where I live in Florida! 89.1 COL score, because this is where everyone’s grandparents come to spend the winter on their retirement income, but I’m 15 miles from the beach and weather is great most of the year. I bought my townhouse for 175k, which really helps keep my costs low w/ a mortgage (including insurance and taxes) of <$700/mo.

  22. A thing I love about living in DC is the easy proximity to three different airports, which helps when friends want to visit from all over. I can take the metro to National Airport and arrive in Logan and take the T to my friends’ house or to the ferry and get to Provincetown. Not driving and having that headache is so worth it.

    And being queer, I will probably never feel comfortable in a suburb or small town unless it is explicitly a queer mecca. Too many bad encounters. Paying for freedom and safety is worth it.

  23. We moved from a very, very inexpensive rural area in the Midwest to a very expensive (for us) medium-ish town out west. We pay A LOT to live here, and if we didn’t feel so invested in our community, we’d be tempted to leave for a less pricy location. At this point I just can’t see us doing that. We love our town too much to go!

  24. On Long Island, we lived with my MIL for discounted rent and I commuted to Manhattan for work everyday. I didn’t own a car. It was great financially–but it wasn’t an enjoyable lifestyle or sustainable for the long term. We moved to Colorado Springs 8 years ago (before everything here exploded) and it was a MUCH better quality of life and financial decision. In my field, I was actually much more desirable in Colorado than in New York (where my field was saturated) and so my salary was significantly more. I also had the opportunity of starting my own business in my field, which over the past 6 years has significantly propelled us to FI. We bought our first house on 5 acres, which would have only afforded us a condo on Long Island. Plus we are still just 18 minutes away from the Apple Store and Whole Foods and other signs of civilization. We have the best of both worlds being within easy access to a small city and all of its amenities, but also having quiet, star filled skies at night at home. FI would have been a distant dream for us on Long Island…

  25. we live in buffalo, a small city bouncing back and it helped get us here to financial independence. mrs. had a solid middle class job and i support chemical plant manufacturing and neither of us had more than 13 minute commutes. our house was dirt cheap in ’98 and that really helped. i think if we sold it today we would get at least 4x what we paid, all pure luck. we’re not from here so family doesn’t keep us here and it’s a little provincial still and less charming than for somebody who grew up here. pollution and air quality are things to consider too. how’s the cancer rate in some cities? it seems high here, but we really like our house.

  26. My family and I live in the Washington, DC suburbs. My wife and I moved here from college because of family and job opportunities. The area is great but expensive so the big city vs small town debate goes on in my head often. For now, a solid job and ties within our community keep us in the big city. Some of my family has moved to North Carolina, where the cost of living is lower while some areas still have a big city suburbs feel. Joining them is tempting but it’s not in our short term plans – at least not until we’ve reached FI.

    While not applicable to everyone, when considering the big city vs a small town, I think it’s important to consider family size. We have three children, so that impacts the obvious things like housing, transportation, and food costs. But one COL number that is often overlooked or difficult to track is the cost of the kids’ activities. We pay much more for sports, music lessons, and other activities than my friends and family members who live in other parts of the country pay. Even getting a traditional babysitter when our children were younger was twice as expensive!

  27. Our financial analysis comes out similarly to yours in our small coastal town, pop. ~5000: higher grocery, transportation, and utilities costs even out any cost savings from keeping up with the city Joneses.

    The main reasons for moving to a rural town were strictly non-financial and quality of life related. Priceless, actually!

  28. I live in a small town in Eastern Europe which is actually one of the most expensive locations in my country and in the area because it is some sort of “Tahoe” of this region: mountain area, very popular ski resort in winter and fresh air getaway in summer. I was fortunate enough to work for West European and US companies for my entire career so far (10 years) so I was able to buy and pay off my apartment 3 years ago, just in time before the house prices went high sky in my town.

    If I were to buy an apartment today or pay rent in my small Eastern European town there would be not much difference in terms of cost of living compared to a large German city for example. I am considering here the fact that around here there aren’t many free interesting activities you can do during weekends (other than hikes), restaurant prices have gone up a lot lately so it is more or less as eating out in any big European city, groceries are sometimes more expensive than in big cities and travelling to Europe (not to mention to a different continent) is a lot more expensive than from a big European hub (I travel around 3-5 months each year).

    While I am seriously considering moving to a European bigger city at some point, the fact that I already paid off my house and I do not have to spend money on rent is a big decision factor for staying in our small town. Currently I trying to save around 70-80% of my income and working on a plan for retiring in about 10 years (in my late thirties – early forties).

Comments are where the magic happens! Let's chat!

This site uses Akismet to reduce spam. Learn how your comment data is processed.