With record-high inflation and cost-of-living increases, many Americans are looking for ways to save money. According to a report from the personal finance website WalletHub, Americans are taking out moving loans and maxing out their credit cards in droves, moving to states with the lowest cost of living to find a better quality of life.
The report analyzed data from each state on 18 factors related to the cost of living, including housing prices, groceries, transportation, and healthcare. Utah was crowned the state with the lowest cost of living overall, followed by Florida and Nevada. Alaska came in last place on the list, with New Hampshire ranking as the state with the highest cost of living.
What factors affect the cost of living?
One of the most critical factors affecting the cost of living is the cost of goods and services.
Alaska and Hawaii are consistently ranked as one of the highest cost-of-living states due to the expense of getting goods shipped to them.
Another major factor that affects the cost of living is the cost of housing. States with a high demand for housing tend to have higher costs, and a housing shortage can also lead to inflated prices. California and New York are two states with a high demand for housing that have also seen some of the highest prices in the country.
To save money while living in a state, it's essential to research what expenses are common and how much they typically cost. For example, many residents in the Northeast see snow removal service as a required expense, while others in warmer climates would never consider the cost of such a service.
Ways to save money on your move
Are you considering a move? Here are four tips to help save money on your relocation:
1. Research the cost of living in your target state. There are dozens of online resources that include data on housing prices, groceries, transportation, and healthcare costs in each state. Knowing ahead of time how much money you'll need to live comfortably will help you plan your budget better.
2. Move during the off-season. Moving during the off-season (such as winter in the Northeast or summer in the South) can be a cheaper option than moving during peak season because many people are already settled in their new homes and don't need to move as much furniture or appliances as they would during the high season.
3. Don't overspend on your move. Although it may be tempting to buy all-new furniture, appliances, and decorations for your new home, resist the urge to overspend. Instead, save money by using what you have in your old home and by packing and moving slowly.
4. See what tax breaks or incentives are available for new residents. Many states are now offering relocation benefits for in-demand workers and digital nomads. If you're moving for a new job, you may also be eligible to deduct your moving expenses from your yearly taxes. Consult an accountant to see if there are perks you qualify for simply by moving to one of these areas.
The bottom line
While some people may move to states with lower living costs to save money, others may move simply for a change of scenery. Regardless of why people are moving, it's essential to be aware of all the expenses associated with a new location before making any decisions.
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Original Source: Credello: Americans Are Moving to These States the Most to Save Money