Are you stupid if you live in a high-cost area?

It Doesn't Make Cents

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Are you stupid if you live in a high-cost area?

Moving to a low-cost area could save you money, but will it cost your sanity?

Sarah and Miranda

Dec 03, 2024

Transcript

Geo-arbitrage is the practice of moving from an area with a high cost of living to a place with a lower cost of living. It’s one of the bits of advice some FIRE enthusiasts suggest for those looking to reach financial freedom faster. But does using geo-arbitrage always make sense?

Topics covered in this episode on geo-arbitrage

What is geo-arbitrage?
Is moving really just about the money?
How to understand your lifestyle and how it fits into geo-arbitrage
Reasons to move
Realities of moving to a low-cost-of-living area and some of the challenges
Understanding taxes—it’s not just about income taxes
Living in a high-cost-of-living area can be the right choice to save your sanity

Sources used for this episode on LCOL vs. HCOL area

Our rant episode that includes info from Eric Rosenberg about choosing a HCOL area
Our episode on choosing whether to have kids
Cost of moving information from HireAHelper and Nerd Wallet
Find information on state and local taxes and property taxes from the Tax Foundation and Bankrate
CNN Money’s cost of living calculator that can help you compare salary needs in different areas
Cost of childcare by state according to World Population Review
Home insurance cost by state from Insurance.com

Our financial resource

If you want to learn more about geo-arbitrage and how to make it work, check out this article from Smart Asset.

Discussion about this podcast

It Doesn't Make Cents

Are you REALLY doing money wrong? Good news: you aren’t doomed to a lifetime of financial failure because you aren’t saving to buy a house, buy a TV with a credit card, or have student loan debt. Get away from all the “supposed-tos” and stop beating yourself up over perceived mistakes. Sarah Li-Cain, AFC® and Miranda Marquit, MBA, are ready to debunk prescriptive money rules and inject a little nuance into your financial life.

This season, we’re talking about the common misconception that debt is ALWAYS bad. We’ll dive into ALL THE THINGS. You don’t have to pay that mortgage off early. Go ahead and finance that car. We’ll also tackle the controversial aspects of debt. How much social debt are you carrying around? Are you really immoral if you have your student loan debt forgiven? We promise corny jokes alongside a whole lotta facts. We might even rant a little. Plus, we’ll show you how to use what you’ve learned to get your money to work best for YOU—no matter what some finance bro says.

Let’s talk about how money might not be what you think—and how you can use it to create the life you want.

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