8 years ago investing100Jake

Build Wealth By Moving Away

I’ve been thinking about moving away from the big city for years and now we are starting some action. We are currently living in a city with around 3 million population which is the biggest in our country. Our plan is to relocate to a small satellite town about 40km away. Why are we doing this and how useful can such move be for you?

Moving Away
Photo by shareski at Flickr

Financial Benefits Of Moving Away

Probably one of the main reasons to consider moving away are the possible financial benefits by it. Most people would agree that living in small town can be cheaper but the idea is quite vague. Let’s try to break down the benefits:

  • Lower grocery prices. It’s kind of paradoxical because the small towns don’t have the big hypermarkets, but it’s still true – the food and other grocery prices are lower in the small towns (at least here)
  • Lower property prices. No doubt, the cost of the properties is much higher in the big city than in the small towns.
  • Lower transportation costs. In the small town everything is on walking or biking distance from you, therefore you don’t have to spend that much of fuel. Of course this benefit will not be there if you have to travel to the big city for work.
  • Health benefits. Less stress, less air contamination and less time spent in traffic jams improve your overall health. This of course results in less medical costs.
[ad#normal-banner] Making exact calculation of the benefits of moving away is not possible, but before taking such decision you need at least to consider a rough estimation. You can give quite good estimation for the property price, the transportation and food costs you are going to have.

The Costs Of Moving Away

It’s quite possible that the costs of moving away can exceed the benefits for a long time. I know it’s tempting to just go ahead and do it but you need to think very well what is it going to cost you:

  • Job. Your options include working in the small town (probably for a lower salary), running your own business, working from home or traveling to work every day. All the options are absolutely viable especially if you remain close to the big city like in our case. Most of them will add to the costs of moving however (lower salary or higher transportation costs for example) so you need to include them in the equation.
  • Home. Do you own a home right now or do you pay rent? If you own your home you need to actually make sure that you can sell it at a good price before planning the purchase of your new one. In our case that’s not a problem, because we don’t own our current place.
  • The cost of the moving itself. Don’t underestimate them. If you have lived for several years at your current place you probably have a lot of stuff, furniture etc that need to be moved. The longer the distance is, the higher the costs will be.
  • Tax and other expenses related to moving.

Once you have the two sides of the equation you are ready to decide. The result does not need to be positive if you are also emotionally attached to moving or staying. It’s just there to help you decide.

An Exit Strategy

Moving away is a big step and like in all big steps something can go wrong. You may get the calculations wrong, you may just forget or not foresee some major cost, or finally you may just not like your new place. So you need an exit strategy – a way to go back. You need enough money or opportunities to revert the change you have made.

In our case we don’t risk much, because we are not changing our work and business neither we are selling a home. But if you do any of these, think what bridges you can leave just so you are safe. Don’t get obsessed by safety though – often the only way to really grow is to cut everything that is behind you.

Jake